Mining stock jumps 7% after securing clearance for commencing operations in coal mine

Synopsis: Gujarat Mineral Development Corporation Ltd has released a press note informing that it has taken a major step towards starting operations at its Baitrani West Coal Mine in Odisha.

The shares of this mining company is majorly engaged in power generation and lignite mining whose minerals are used across various industries such as textiles, chemicals, ceramics, bricks and  captive power, jumped upto 7 percent in a day’s trading session upon securing clearances towards operationalising coal mine. 

With the market capitalization of Rs. 16,655 Crores, the shares of GMDC has reached an intra day high of Rs. 529.90 per equity share rising nearly 7.2 percent from the previous day close of Rs. 494.10 per share.

What is the NEWS:

GMDC has issued a press note announcing that it has received two major approvals, Stage-I Forest Clearance (FC) and Environmental Clearance (EC)  from the Ministry of Environment, Forest and Climate Change (MoEF&CC) for commencing operations at the Baitarni-West Coal Mine in Odisha. The company has also appointed a mining partner to undertake the operational responsibilities of this 15 MTPA opencast coal mine.

GMDC’s Managing Director, Roopwant Singh, stated that advancing the project to this stage in just 2.5 years reflects the corporation’s efficiency, adding that the focus remains on creating long-term value, supporting regional development, and ensuring sustainable mining practices.

Company Overview and Financial Highlights

GMDC is one of India’s leading mining companies, operating five lignite mines across Gujarat and serving as one of the country’s largest merchant sellers of lignite. In addition to lignite, the company also produces bauxite, calcined bauxite, fluorspar and manganese ore, and is engaged in power generation. The lignite supplied by the company is widely used across several industries, including textiles, chemicals, ceramics, bricks and captive power plants.

GMDC achieved 8 million tonnes of lignite production in FY25 and expects a 10–15% increase in volumes in FY26. The company has also outlined a long-term capital expenditure plan of Rs. 13,000 crore up to 2030, with an annual spending target of Rs. 1,500–2,000 crore.

Year on Year analysis:  GMDC’s revenue has decreased from Rs. 593 Crores to Rs. 528 Crores., down 10.7  percent, its operating profit  has decreased from Rs. 140 Crores to Rs. 69 crores, down ~50 percent and its net profit has increased from Rs. 128 Crores to Rs. 466 Crores, up 264 percent. 

Quarter on Quarter  analysis:  GMDC’s revenue has decreased on a quarter on quarter basis  from Rs. 733 Crores to Rs. 528 Crores., down 28 percent, its operating income has decreased from Rs. 169 Crores to Rs. 69 Crores, down 59 percent and its net profit has increased from Rs. 164 Crores to Rs. 466 Crores, up 184 percent. 

Written by Vachan Kadli   

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