Sops for Coal India staff
Around three lakh non-executive employees of Coal India and its subsidiaries are set to benefit from the Centre's move to increase the one-time advance payable to them.
- Published 16.10.17
Calcutta: Around three lakh non-executive employees of Coal India and its subsidiaries are set to benefit from the Centre's move to increase the one-time advance payable to them.
The decision was triggered by better operational performance in the last one-and-a-half months and the conclusion of wage negotiations on October 10, 2017.
The one-time payment adjusted against arrears on pay revision due since July 1, 2016 has been increased to Rs 51,000 instead of Rs 40,000 and is payable by October 17.
The management of Coal India and trade unions have agreed on a memorandum of agreement for National Wage Agreement - X for a period of five years from July 1, 2016 to June 30, 2021 and the total estimated average annual impact of the wage revision is Rs 5,667 crore.
The unions have welcomed the decision of the Centre to increase the size of the one-time payment.
According to a research report by Motilal Oswal, the wage revision will inflate the annual wage bill estimates to Rs 36,400 crore in 2017-18.
"This will impact the EBITDA and profit after tax by 11 per cent in the 2017-18 estimate," said the report. The firm said it has not factored in any increase in prices in its calculations but said the miner may consider a revision in prices following a clarity on wage hike.
Market analysts are upbeat about the upsides in Coal India's performance following the pending wage revision, which has resulted in the miner making provisions, which would eat into its bottomline.
Among the positive trends are a gradual increase in e-auction prices and growth in volumes because of an end to de-stocking and demand acceleration and import substitution.
The coal ministry in a statement has said that following a production growth of 10.1 per cent in September over the corresponding period in the previous year, there has been a 13 per cent rise in output in October so far. The coal dispatch to the power plants has grown 22 per cent till October 12, 2017, already crossing the 21 per cent growth recorded in September.
The increasing trend of production is likely to sustain in the coming days with de-stocking by power plants.