Recently, the networth of the country's largest coking coal producer Bharat Coking Coal (BCCL) turned
positive after several years following the fund infusion by Coal India (CIL).
BCCL's net worth is learnt to have been exhausted by accumulated losses of about Rs 5,600 crore till March 2012.
The company's networth had turned negative for the first time in 1994-95 after a string of losses since inception. The company came under the purview of Board for Industrial and Financial Reconstruction owing to its weak financial position. It had been posting losses since its inception in 1972. It was referred to the BIFR in 2001.
CIL infused Rs 2,539 crore into the company against the non-convertible, redeemable, cumulative preference shares issued to it. The infusion is said to be a mere book entry that allowed BCCL to balance out a due of Rs 2,539 crore to the state-run coal miner. Following this capital infusion, the company's networth is expected to be about Rs 400 crore.
BCCL has to repay the preference share capital at the expiry of seven years from the date of issue and allotment. However, CIL would have the option to redeem them at any time after the expiry of five years from the date of issue and allotment of the shares.