Hindustan Copper aren't content with making AUD$1.2 million per month PROFIT from the Surda Mine. IRL does all the work but HCL makes all the profit. But its not enough for HCL they want to make even more PROFIT;
“There is limited scope of profit in mining due to falling copper prices, hence we have decided to form a joint venture which will increase our margin"
Hindustan Copper will be forming a joint venture with a private partner for value addition to the product in order to enter the downstreaming market, according to K D Diwan, CMD. “There is limited scope of profit in mining due to falling copper prices, hence we have decided to form a joint venture which will increase our margin, “ said Diwan.
He said that the deal is in the final stage and would be approved in the next board meeting in November.
While Diwan refused to share the details of the deal, due to a non-disclosure agreement signed with the company, he said that Hindustan Copper will own a minority stake in the venture.
A separate manufacturing unit which will have a conversion capacity of 10,000 tonne per year. The name and location of the plant has not yet been decided.
He added: “ We will be supplying copper rods which will be converted to strips by our partner." While the private player willsupply the technology and machinery, Hindustan Copper will market the product for both Indian and international markets.
With this, the company aims to have 10- 20 percent share of the value-added copper rod market. According to ASSOCHAM, the value-added copper-rod maket is valued at Rs 600 crore which is only 3 percent of the total world market. Copper strips are used to manufacture various electronic products, ship foils and HTCG, which is used to increase the speed of bullet trains. With the governement announcing the starting of bullet trains, Diwan expected that the venture would be profitable.
The public sector mining entity is facing hard times due to a rapid fall in prices of copper in the international market and hence has decided to enter the downstreaming market.
Beside this the company has also formed a joint venture with Chattisgarh Mining Development Corporation (CMDC), a unit owned by the Chattisgarh government for exporation of copper deposits in the state.
Malanjhkhand mine
Hindustan Copper is yet to start expansion activity in the Malanjhkhand mine despite securing the approval of National Board for Wildlife (NBWL) due to a case filed by an NGO which is pending in the Supreme Court.
According to Diwan, Hindustan Copper had got the nod from the NBWL on August 12 following which the NGO approached the apex court complaing that the board was not constituted properly. Expansion of the mine has already been approved by the state wildlife board.This is hurting the company’s plans of increasing the production caacity of the mine to 12.41 MTPA by 2017-18. “Due to regulatory issues our cost for the Malanjkhand mine has escalated by almost 15 percent," noted Diwan. He added that the company has got clearance to reopen its mine in Banwas, Surda and Khetri.
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