GMDC MD Roopwant Singh highlighted that for stable power sources, coal and oil companies will thrive despite the multifold growth of renewable energy sources.
Mining giant Gujarat Mineral Development Corporation Limited's (GMDC) MD Roopwant Singh on Friday said that investors need to change their perspective towards mining and oil stocks and push the growth trajectory of these companies by putting money in their stocks.
"The shares of mining companies have not gone up by more than 1-1.5% in the last 10 years. This trend needs to change. Picture this, coal has not peaked yet. Coal will peak in 2035. Petrol and natural gas will peak by 2040. During this time, they will go better, then peak and then go down. Non-conventional energy and renewable energy will go 2X to 3X. But conventional energy despite many changes will see a rise of 5 to 10%. It is because we need a stable grid for power to sustain all the growth plans. That's why we would request investors to look at old boring, old-school industries. They are reliable to make money," GMDC MD Roopwant Singh said at the BT Bank Summit on Friday.
GMDC is a mining and mineral processing major and is the largest merchant seller of Lignite. It has more than six decades of experience in the mining & minerals sector. GMDC is the leaders in exploring and exploiting lignite, Bauxite, Fluorspar, Manganese, Silica Sand, Limestone, Bentonite and Ball Clay.
It also won the bids for Odisha's Burapahar Block in Sundargarh District, having a Geological Reserve of 548 million Tonnes and the Baitarani (West) Block in Angul District a geological reserve of 1152 million Tonnes.
Speaking on coal's relevance in the current times, Singh added: "Gujarat gets its stable power from coal-fired and lignite-fired plants. Most of these will be reaching the end of life in the next 7 to 8 years. The second lot in 15 to 16 years. This is 8 Gigawatt of state-owned assets, we have private companies contributing to power generation. So, we are now in Odisha. We are planning to produce 5 Gigawatt power to meet the needs under the guidance of the Centre."
In Q3 FY24, GMDC's standalone net profit declined 55.61% to Rs 117.47 crore as on Q3 FY24 as compared to Rs 265.10 crore recorded in Q3 FY23.
Revenue from operations fell 34.03% to Rs 564.27 crore in Q3 FY24 as against Rs 855.41 crore recorded in corresponding quarter last year.
Profit before tax stood at Rs 111.14 crore in Q2 FY24, down 45.51% as compared with Rs 203.95 crore recorded in the corresponding quarter last year.
On the segmental front, revenue from mining was at Rs 534.69 crore (down 34.35% YoY) and revenue from power stood at Rs 57.39 crore (down 27.66% YoY) during the period under review.
On 9-Month basis, the companys consolidated net profit fell 46.16% to Rs 409.47 crore in 9M FY24 as compared with Rs 760.61 crore recorded in 9M FY23. Revenue from operations decreased 32.83% YoY to Rs 1,712.61 crore in 9M FY24.