Special Correspondent
Invites expressions of interest
Centre approves financial recast package
Five cos. show interest in partnering HCL
KOLKATA: The public sector Hindustan Copper Ltd. (HCL) is planning to get into gold mining. Company Chairman-cum-Managing Director, S. C. Gupta, told The Hindu that this was being seen as an opportunity even as HCL looks at mining increased quantities of copper from its existing mines and from greenfield ventures. HCL is India’s only integrated copper mining company with mining leases and facilities in Rajasthan, Madhya Pradesh, Maharashtra and Jharkhand. Its products include copper ore, concentrate, cathodes and wire rods.
He said the initiative on gold mining which could get rolling only between 2010 and 2015 had been discussed with the parent ministry and overseas companies may be roped in as joint venture partners.
He said at present gold was mined at the Hutti Gold mines in Karnataka and the huge demand was met mainly through imports. He said at least three sets of approvals were necessary before gold mining could be started. This included a prospecting licence and a mining lease which were given by State governments.
Mr. Gupta said GSI has established gold deposits in Rajasthan, where HCL has a presence.
The company which has a very small public holding (about 0.5 per cent) has recently received a boost by way of the Centre approving its financial recast package. Mr. Gupta said this would help clean up the balance-sheet and also strengthen HCL’s borrowing capacity, besides boosting its ability to scout for joint venture partners.
It has lined up some greenfield ventures and mine development programmes for which it invited expressions of interest.
Three Australian companies and one company each from the U.K. and Sweden have shown interest.
Mr. Gupta said the financial recast proposal includes reduction in the face value of the share from Rs. 10 to Rs. 5 and adjustment of the resultant Rs. 382.21 crore capital reduction against the Rs. 400 crore accumulated losses. HCL entered the profit-zone three years ago after an eight-year long loss-making phase which eroded its capital base considerably.
The recast proposal also envisages increasing the retirement age to 60 and creating a new post of director, mining.
As per the recast package, HCL will be required to improve capacity utilisation in its plants and also reduce operational cost. Its ore production stood at 3.27 lakh tonnes in 2006-07. The turnover was Rs. 1,799.60 crore with a net profit of Rs. 331.80 crore.
