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Stock Report
Power Mech Projects Ltd JV bags huge Mine Development and Operation contract from SAIL
Posted On : 2023-07-31 21:54:04( TIMEZONE : IST )
Power Mech Projects Limited (PMPL) bagged a Mine Development and Operation Project (MDO) for an estimated value of Rs.30,438 Crores from Steel Authority of India Limited (SAIL).
This project is being awarded to a consortium of Power Mech Projects Limited - PC Patel Infra Private Limited for Development and Operation of Tasra Opencast Project, located at Jharia Coal fields in Dhanbad District, Jharkhand.
The duration of the contract is 28 years (including 2 years of development period).
The scope of the MDO contract mainly comprises of mine infrastructure development including extraction of coking coal, crushing, transportation, setting up of washery and supply of steel grade coking coal to SAIL.
The MDO contract will primarily comprise of mine infrastructure development, removal of overburden and extraction of coking coal, crushing, transportation, setting up of coal washery of 3.5 MTPA capacity, supply of steel grade coking coal to SAIL, carrying our R&R activities and other activities incidental to mining as per the project document at Tasra, located in Jharia Coal fields in Dharibad District, Jharkhand.
The project has total coal extraction reserves of 96.78 MT with an annual capacity of 4 MTPA and over burden removal during the project period is 535.29 MBCM.
The contract would be executed through a Special Purpose Vehicle (SPV), to be incorporatedfor the said purpose with Power Mech Projects Limited holding 74% stake and PC Patel Infra Private Limited holding 26% stake.
Commenting on the project award, Mr. Sajja Kishore 8abu, Chairman and Managing Director said, "This project will further strengthen our robust order book and enable the Company to diversify its order book which is in line with its strategy to have an optimum mix between power and non-power segments. This mine has all statutory approvals in place and it is a ready to mine project. Therevenue booking can be started from FY24 onwards. Thisproject can add peak turnover of around Rs. 1,200 crores plus escalation annually. With the revenue coming in from both the MODO Projects along with the existing operation & maintenance (O&M) business,we expect to witness sustainable growth both in top and bottom lines in the future for a longer period.
India is majorly dependent on costly import for meeting its coking coal requirement and Tasra is another important step for SAILand our nation to meet the growing demand of coking coal. KBP and Tasra MDO's together will generate 9 MTPA when the peak capacities of the respective mines are achieved and the coking coal extracted through these mines will definitely be an inexpensive alternative to the coking coal which the Country is currently importing and will save forex outflow.
This project is a strategic step in forward integration in the Company's activities, utilizing the technical know-how along with project implementation capability. PC Patel's technical expertise along with PMPL's core capabilities in the field of fPC contracts, plant installation, civil & structural works, material handling, infrastructure construction and project management coupled with operation & maintenance expertise comes in handy. PMPLhas already established substantial in - house capability in executing large capacity material handling contracts and this experience will greatly help in the overall development of the project.
Foreseeing the growth, expansion and diversification, management has started identifying relevant talent and drawing them from reputed organizations. The Company has equipped itself in meeting the demands in executing mega and complex projects smoothly, keeping quality, safety and timeline."
Shares of Power Mech Projects Limited was last trading in BSE at Rs. 4609.95 as compared to the previous close of Rs. 4218.55. The total number of shares traded during the day was 17415 in over 3765 trades.
The stock hit an intraday high of Rs. 5062.25 and intraday low of 4570.60. The net turnover during the day was Rs. 82638774.00.
