Coal India gains 2% on shifting into new pricing policy

Coal India is trading higher by 2% at Rs 307 after the company entered into a new pricing policy, effective today.

The board of directors of the world’s largest coal producer at its meeting held on December 30, 2011, has approved switching over of non-coking coal pricing from useful heat value (UHV) based grading system to gross caloric value (GCV) based classification w.e.f. January 01, 2012.

The company shifts to international pricing, 30-60% higher than what the state-run firm’s average price used to be, by benchmarking coal on the basis of GCV. India was the only country, among major producers, not following the GCV system.
 
“It is difficult to assess the exact impact as it will be based on the caloric value," the state-run company said in a filing to the stock exchanges.
 
“There will surely be a positive impact. As far as prices are concerned, the result would be different on different subsidiaries; some will get more and some will get less" reports suggests quoting N C Jha, chairman and managing director of the company.
 
The stock opened at Rs 303 and hit a high of Rs 308 on the National Stock Exchange. A combined 1.1 million shares have changed hands on the counter so far on both the exchanges.