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Gujarat Mineral Development Corporation Ltd
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Good afternoon, ladies and gentlemen. I'm Rutuja, moderator for this conference. Welcome to the conference call of Gujarat Mineral Development Corporation Limited, arranged by Concept Investor Relations to discuss its fourth quarter and fiscal year ended March 31, 2021.
We have with us today Shri Roopwant Singh IAS Managing Director; Shri L. Kulshrestha, Chief General Manager and Chief Financial Officer; Shri H.K. Joshi, Senior General Manager, Technical; Shri Swagat Ray, General Manager, Project Planning & Development; Smt. A.K. Iyer, General Manager, Accounts; Shri Joel Evans, Company Secretary; and Shri Rajat Dash, General Manager, Marketing and Sales. [Operator Instructions] Please note, this conference is recorded. I would now like to hand over the floor to Shri Roopwant Singh, Chairman and Managing Director. Thank you, and over to you, sir.
I would request [indiscernible] to begin opening remarks.
A very good afternoon, friends. On behalf of the Gujarat Mineral Development Corporation Ltd, I extend a very warm welcome to all the participants to this earnings call to discuss our quarter four and fiscal '22 results. We are happy to announce that GMDC has delivered its best ever annual results over the last 5 years and is the second best in the company's entire life so far.
I'm sure all of you have gained the information from the results that we have put in our public domain. I would like to reiterate some of the key financials. The company has put forward remarkable performance in this quarter 4 with the reported profit after tax of INR 176 crore and has crossed the revenue of INR 1,097 crore. We have experienced yet another dynamic quarter.
We are happy to answer all the queries from our investor community. Our top management are sitting here to answer and -- to answer all clarifications, questions and queries that you might have. We keep the floor open for your queries. Thank you.
[Operator Instructions] The first question is from the line of Amit Dixit from Edelweiss.
Congratulations for a spectacular set of numbers. I have 3 questions. The first 1 is on the distribution. So if I look at the receivables for FY '22, they have gone up sharply compared to FY '21. So I just wanted to understand the reason why they have gone up. Is there a particular customer, I mean, where the receivables are stuck or something like that?
The second question is on the bauxite stockpile that we have in [indiscernible]. So did we sell some part of it in Q4? And what are the plans for selling it, I mean, both in FY'23, and what would be the approximate realization for the sale?
The third question is essentially on the organization front. As we see on the website, there are a number of positions that we have tied for, including the geologic for base metals and all. So just wanted to understand the interest in base metals. Is there any possibility here that you are to guide for this to be. These are the 3 questions.
Thank you, Amit. I will be -- I'll be requesting my team members to take these questions one-by-one. We will begin with the last one first, regarding the advertisement for geologists for base metals. I would request our General Manager for Geology and will add resources to kindly take this question.
[indiscernible] in fact, base metal deposits is situated in Banaskantha district of Gujarat and the northern part of the Gujarat. And GMDC is holding a mining lease over an area of 184 hectare. And we are having the best base metal deposit of the world having 1.5% copper.
And we are planning to start the geological study of this area, followed by geophysical mapping and drilling. So for that purpose, we have planned to hire senior geologist for that post.
For the next question on the development of -- on what we have been doing with our bauxite resources I would request our General Manager, Marketing and Sales [indiscernible].
Good evening, Amit. This is R.K. Dash. I suppose you're asking the question is about bauxite and prospects on bauxite mining and sale in future days to come. Yes, of course, there was certain deadlock. And however, we are able to sell our green-grade bauxite that is called plant-grade bauxite, and we are unable to supply as per demand.
But yes, there are certain slackness in this NPG-grade bauxite. But we have started the process of intensely -- actually, we are aggressively engaged to sell these inventories, which are lying at their various stacks since long. And for that, on pan-Indian advertisement regarding the tender notice has been published. It is midway, and we are getting responses.
At the same time, we are trying to analyze what are the issues that why this bauxite -- what are the issues by which we can attract the end users or customers. There are few engagements in that regard as well. So we have engaged BCG, and they are also setting out the plant to actually increase the bauxite -- the sale of bauxite in a big way.
So these are the deliverables which are already -- in some cases, we are already in progress, and in some cases, that is in card. Thank you.
And for the question on base metal, I will request Ms. Anupma Iyer, General Manager Accounts.
This is Anupma Iyer. Our receivable has gone up because of our build for our renewable energy. We had some issues with due -- the matter is up to judge, but now that matter has been resolved, and we have received these payments in the month of April.
At the end of the March, the bills were pending from the side of [indiscernible] now we have received. So now it is clear from [indiscernible] part. So as in had that much, we have shown the higher receivables. But in end of month of April, the same has been cleared. Due has been cleared.
Just very quick follow-up actually. On the receivable side, how much is receivable spending? How much did you receive? That is the first thing. Then on the base metal thing, which seems to be exciting. You said 1.5% copper is there. Is there some other base metals such as zinc over there? And if you can throw some light on the possible business plan for extracting them, a very high-level plan will do.
Receivable, you're asking about the receivables, or you're asking about the base metals?
No, no, both actually. Receivable what was due and...
Receivable being this pending on the due itself. That we have received.
No, how much was it, the amount?
It was around INR 80 crore.
INR 80 crore. Okay. That's helpful. Now for base metal, I mean, what on base metals do you have...
[indiscernible] combination of lead, copper and zinc and total metal containing is around 10%. Copper 1.5%. Lead is around 3.5%, and rest is zinc. And we are planning to extrude that area in detail through magnetic survey and followed by drilling and geochemical mapping.
So soon, we will highlight some techno-feasibility study and results of that, and then they will follow up that thing. Thank you.
The next question is from the line of Bajrang Bafna from Sunidhi Securities.
Congratulations for a good set of numbers for the entire GMDC team. So my first question pertains to the overall -- the demand environment in the Gujarat region. So if you could just tell us, we are -- obviously, we are seeing the volume is more or less in line with our expectation of 2.5 million tonnes during the quarter. But going into this and the next quarter, how is the demand environment and the pricing that we are seeing because, after so many fortnights, we were constantly taking price hikes. And in the last fortnight, I think we halted and we didn't take any price hike. So in terms of -- and the international prices, are they still running high and going unabatedly on the higher side? So if you could just tell us both the demand environment and the pricing scenario that we are anticipating in the near future? So that's my first question.
And my second question pertains to the development on the other projects. Yes, we got a fair idea of base metal project. But the other projects like the lowest bar and the rare earth metals. So if any update that the management wants to share will be really helpful for us to understand the future prospects on those comps.
Thank you, Bajrang. For the first question, demand and outlook currently and in the future for lignite, I would request General Manager, Technical, Shri H.P. Joshi to give you a perspective on that.
This is H.K. Joshi. The demand in fossil fuel in Gujarat is almost 25 to 28. We are producing 8.5. So there is a huge gap. So there is no worry of sales that, in the demand environment, we are very much comfortable in Gujarat.
Secondly, the pricing scenarios, the pricing of generic [indiscernible] and 50 is related to imported coal difference landed price at the customers' [indiscernible] Is it enough?
Yes. So what was the average price during the last quarter for the lignite mining, the weighted average price?
Mr. Bajrang, time-to-time we used to publish all these updates in our website. What I can recall is that the [indiscernible] price based on various components. But roughly, I can say that it will be around INR 4,000 to INR 4,200.
Okay. Okay. Great. Great. And the update on the other projects, sir?
Bajrang, for updates on project, I would request [indiscernible] to give you a perspective, and he shall also be replying to our position, current position on the RE question.
Bajrang, we are having a very good property as well as a abundant plan at current planning for fluorspar mineral. Recently, we have quoted an RFP from PMC of the plant. We are going to start this plant probably in this fiscal year, and let us see how good we can do there.
Your next question is regarding [ RA. ] Recently, our Board of Directors has been authorized to make a strategy document on behalf of [indiscernible] of Gujarat in RA. We are ready to board a very good international consultant, who is a well known name. And within couple of months or 3 months, will brief you in detail. Enough, Bafna, sir?
Okay. Okay. And sir, any update on the fluorspar project also? Any development on that side?
That was my first answer. We have good mines there. [indiscernible] fluorspar mineral, and we are having an abundant plant. For each, we have begin an RFP on net and for PMC of this plant -- and very soon, we'll onboard an EPC player for starting of this plant again.
Okay. Can we expect this in FY '23, the commercial production?
I can answer as soon as the PMC will onboard it.
[Operator Instructions] The next question is from the line of Vaibhav Badjatya from Honesty and Integrity Investment.
So I will ask 2 questions. First is in the -- so in Q4, actually, we have achieved EBIT or EBITDA per tonne of around INR 1,600 per tonne as per the data given in the presentation and the financial result. And do you have an estimate of 10 mt sales in FY '23? So that itself kind of give us around INR 1,600 crores kind of number in terms of the debt.
And I'm sure the Q4 numbers in terms of realization will not have the full impact of price hike taken during the quarter. So that will play out going forward. And then there will be further possibility of prices as you have already increased the prices in [indiscernible]. So in that context, I just wanted to ask that in the TV interview, you earlier said that we have about INR 1,213 crore of power and INR 1,300 crore EBITDA is kind of an ambitious target for us.
So just wanted to understand why it is ambitious and why it is not realistic. And are there any kind of extra cost that is expected to come up, or any kind of surprise that is there on the cost side, which can stop us from achieving this kind of results.
So I would request, again, as General Manager, Marketing and Sales to give you a perspective on per tonne realization. And I request Mr. H.K. Joshi to give a perspective on the addition trending for the current financial year.
As I understand your question is regarding the expectation that the realization in next financial year will be to the tune of INR 1,600 crores to INR 1,300 crores. That's your question?
Yes. So basically, given that the achievement that you have done in Q4, which is EBITDA per tonne basis, we have achieved INR 1,600 per tonne EBITDA. I'm not talking about the gross sales. I'm talking about the profit [indiscernible] which is the EBITDA. So if I take INR 1,600 per tonne of EBITDA, and you have a target of 10 mt of sales in FY '23, so that translates to INR 1,500 crores of EBITDA in FY '23 from lignite operation itself. And one of the CNBC interview, I think it has been mentioned that INR 1,200 crores to INR 1,300 crore would be an ambitious target. So I just wanted to match both the things that why it is an ambitious target and why it is -- why it cannot be achieved easily because of targeting the size on the cost front, which is leading you to believe that we cannot do INR 1,600 crores of EBITDA.
Actually, as part of that into, I was in sideline. So I see that there is a mistake in interpretation. And that was the -- somebody asked and [indiscernible] was answering that question. So while answering to that question, it was mentioned that some of the analyst quoted that GMV potentially will be this much. And responding to that, there was the answer from our end is, yes, that will be our objective of that we cherish too. So in no case, either the original demand from our side. So we are targeting it, but we are working in a very, very variable environment.
So -- so in that, whereas we're targeting it so that we can disclose that, it will be the ultimate target we may go beyond. And so we will try to go beyond as well. So in that case, actually, that was our -- that I already answered to the question. So the context was very clear. But the next question, actually, I'm passing on the mic to Mr. H.K. Joshi.
Yes. So I think that actually answered my first question. The next question was -- next question is on the current depreciation, which is there in terms of cost per KL for lignite and for imported coal for any customer in Surat. If you can just highlight what is the differential currently, that would be helpful.
Vaibhav, again, these are all internal calculations. So we are not -- and again, it is actually a complex help license because our mines are located at various geographies and locations. So I can say that still, we are at a discount -- so we are quite competitive in comparison to the imported coal landed at this Surat demand center. So that's what I can answer as of now.
The next question is from the line of Subham Agarwal from Aequitas Investment.
Sir, firstly, I would like to congratulate the entire team of GMDC for a superb set of results. Sir, my first question would be a datapoint. So I wanted what is the total external sale of lignite this quarter and last quarter?
And secondly, on the pricing part, sorry, secondly, on the demand part, as you -- as all of us know that the demand of coal is very strong, I would like to know if there is a possibility of surpassing that target of 10 million tonnes for FY '23?
Thank you. Actually, I would request Mr. H.K. Joshi to take [indiscernible] lignite and [indiscernible].
The demand of lignite is as I stated earlier. Demand of fluorspar and [indiscernible] is very much high. And as we have planned to increase our production is 10% to 15% for a number. So we are setting this target accordingly. However, every goal has to be set. And let us see after 1, 2, 3 quarters what is the net target. At present, I merely can say, it will be increased by 10% to 15%.
Okay. Okay. And what was the total external sale of lignite this quarter and last quarter.
Mr. Ray is answering [indiscernible].
In the Q4, the external sale of lignite was around 2.5 million tonnes. And in Q3, it was around 2.2 million tonnes.
So our production and external sales, both are same. We must be using some part in our power plant, right?
Yes. We don't maintain any stock. Our production figure is very much similar to that update price, sell.
Okay. And so where are we procuring the coal for our power plant then?
It is an indigenous production which do the supplies for the power plant.
Let me answer in every -- actually, during quarter 3, it was 2.2 million metric tons altogether, including the [indiscernible] and I would have supplied to an independent power plant of [indiscernible]. And again, 2.5 million during quarter 4 is, again, inclusive of the fact that it's supplied to the power plants -- to our own power plants are factored in this figure as well.
Correct. So I just want is that extruded number?
So roughly, we used to supply to them at a rate 1.5 metric ton per month. That is an average.
Okay and lastly, just a confirmation on tax adjustment. So as we have moved to the new regime, from next quarter onwards, our tax will come back to 25%. That's the right assumption [indiscernible]
It will be consumed -- it will be slightly higher to 25% because we have to make some adjustment for the deferred test. But the normal tax which we'll go into deposit as advance tax will be 25% because we have offset for the new uses. Likely, it will be higher because of deferred taxes.
The next question is from [indiscernible]
What's your outlook on lignite prices, sir?
Okay. So I'll take that as the first question on pricing.
Yes. And like is it possible that significant ramp-up given the scenario of demand all time they're hearing about coal shortage in the country so both as a national duty plus as a profitable possibility. Don't you think -- if you can, you can significantly ramp up the production. These are the 2 questions, sir.
I would request Mr. Joshi to take the ramping-up question, which he has already handled, and if you could give a perspective on where we were a couple of years ago and where we are with this now.
So last year, we have produced 6 million. This year, we have produced 8.5 million, and most, probably we'll continue the trend.
Okay. Okay.
And for lignite pricing, how will we be able to sustain it upmarket [indiscernible]. Regarding the lignite pricing, we have linked our lignite pricing with international core pricing, and that is not the sole factor. Apart from that, we used to also factor how much quantity is being delivered at the post sites and what are the demand situation, and there are certain internal calculations as well.
So based on that, we used to devise our pricing mechanism. And so that will be the trend for future days to come. We'll be linking it with foreign core imported coal, and we'll be also adjusting with so many internal factors.
No, sir, the question was not about the process of how you arrive at the price. It was your outlook on the price, if you can comment on that? Like do you expect these kind of prices to sustain.
So look, feel that it is sustaining. We are into this given to the international pricing of the imported coal. Still time, it is sustaining. And we hope that we will sustain because we are having our own sound analysis.
The next question is from the line of Falguni Thacker from Jet Age Securities.
Sir, I just wanted to know this INR 4,000 to INR 4,000 per tonne of realization that you mentioned, is it net to you without royalty and all?
The next question?
And secondly, I just wanted to know, other than lignite, the other minerals that you're talking of, by which year should we expect them to contribute significantly to our top line.
For the first one, I would request Ms. Anupma Iyer to give her perspective. We can begin with Mr. Rajat Dash, and she can fill in later. And for the other minerals, I will pass on to Mr. Swagat Ray.
The INR 4,000 to INR 4,200 rupee realization is excluding all the pass-throughs that is royalty, DMS and et cetera, et cetera. So these are all basic prices.
And sir, what was it same time last year, the same number. This is the Q4 average you said, right?
Yes.
So what was it last year?
If I can recall, it was around [indiscernible]. But again, these are based on my memory.
Okay. Sir, nevermind. If you can also -- I mean, in other ways, you can give Q3 number will also do, how much was it in Q3 of FY '20.
During Q3, it will be again INR 3,000 crore to INR 3,200.
INR 3,200?
Approximately.
Anupma, [indiscernible].
On lignite, we have royalty and royalty to charge INR 400 as GST compensate reset. All these are pass-through on actual basis.
They're not included -- they are not part of INR 4,000. They are over and above INR 4,000, right?
Yes, yes. And the INR 4,000 is average price. It depends. Mine-to-mine, it varies.
Yes, I understand, but it is -- all these charges are over and above this price that [indiscernible].
Over and about and this is passed through on actual basis.
And on the mineral, other than lignite, when do we expect a significant contribution from other minerals.
This is Swagat Ray. Yes, I hope you have got your answer. You are satisfied now. And regarding the other minerals, first, I would like to funnel that we have obtained 6 new lignite blocks that will add to our results in the existing operating mines. So we have around 540 million tonnes of lignite [ leaders ] in these 6 blocks. Apart from that, there are certain associated minerals in overburdens in these blocks. So the major is the limestone deposit, which is in the tune of around 2,000 million tonnes. And in one of the blocks, we are also getting silica sand. So hopefully, these blocks will be developed 1 by 1 within a couple of years. And for multimeter, bauxite, already in the previous questions our officers have answered, and I think you have also heard about the.
The next question is from the line of Riken Gopani from Capri Group Global.
I first would like to congratulate the entire team for the performance. My question is regarding the outlook on the fixed and variable cost for the lignite division. If you could outline what are the factors that could influence it? Do you expect them to broadly be steady, or what are the factors that could lead to a material upside or downside on the fixed and variable cost for the mining division in FY '23.
Next question please, Riken?
No, I only have one question.
Thank you. So I would request our Chief Financial Officer [indiscernible].
Yes, on component in case of lignite is variable expenditures and an average fixed expenditure. Regular expenditure includes injection of the stock, mining expenses, royalty, transportation expenses and GST compensated. And in case of this advantage, [indiscernible] plant operating expenses, rent, rate taxes, insurance tailings, stationary impairs and financial targets, [indiscernible] mine [indiscernible] administrative expenditure, legal and professional expenditure. As far as do you want to know mine rights [indiscernible]?
Sorry, sir, my question was basically, just to put it the other way, in Q4, if I put the numbers, then your total cost per tonne is about INR 2,000 per tonne of fixed plus variable cost. How do you see this cost panning out in FY '23. What's the outlook on that?
FY '22 and '23, we expect that fixed expense improved by 8% to 10% and variable cost that will remain same because we engage in proportion of total [indiscernible]. We are expecting 10 million tonnes, and previous year expected 0.5 million tonnes. That's why it will change accordingly.
Our variable cost increase due -- mainly due to increase in prices of diesel because of [indiscernible] cost is diesel only. So if the diesel price has gone up, our variable cost is going to go up. So it depends on the diesel prices, how it moves.
The next question is from the line of [ Rabindra Nath Nayak from Sunidhi Securities ].
I have a question regarding the corporate in your presentation. There is in the corporate segment, the cash profit has gone down from last quarter. It was -- if I calculate it correctly, it was INR 12 crore. It has gone down to INR 6 crores. So why it is so? While the expenses in the corporate segment has gone up, can you take the gains of visions for this?
Rabindra, the second question, please?
Second question regarding what is the status of our discussion with the juvenile for the tariff side? Because if the ignite prices has gone up to around INR 3,700, and it is not reflecting in the tariff. We are still selling the power at around 2.90 percent per unit. They are not calculating it correctly.
So it is not reflecting because your variable cost is hardly around INR 50 crores, INR 48 crores in this plant. And the lignite price is not getting reflected. So what is the discussion? How we are going ahead with this plan? And if at all any third party who takes up the plant, whether it be lignite whatever business he will be using, it will be transferred at a market price, and the tariff will be higher, and the beneficiaries will not get the right price or cost for the power for them will be higher. So it is that reason why the power plot, is it one of the reasons that we are not able to sell or take any decision on selling the power plant? Or what is the discussion on the sales side or the divestment of the power plant. Can you please update on that?
The decision to dispose of the power plant has been withdrawn. The negotiation with UBN on a number of aspects, I would request General Manager Power, Mr. Janardan Dave to take this question, please. After that, [indiscernible].
As far as thermal power is concerned, we have taken 2 action for the short term and long term. For the short term, we have corrected our major equipment defects like boilers and turbines and a sector auxiliary, and we found the improvement in [indiscernible]. From the last year, it was 90% pillar. This year, we achieved 34%. So our short-term action showed the results. As a part of long term, we have onboard the strategic partner, [indiscernible] the technical study of the plant financial assessment of the plant. And now we are on the review of this report. So we have finalized -- we will soon finalize the action to improve these context.
Okay. Is there any chance that the variable cost will get some uptick because of the prices of lignite has gone up, or we will be selling at a lower rate compared to the market rate lignite to the power plant.
The relief you see from merit order of the LDC. We are in the third position at present PPA. Even we increase our variable, we will remain -- as per our analysis, we will remain up to the test. So after the sale, there is no issue for the betting down or technical minimum. So we have no any issue related to the technical minimum with the SLBC or discount. There is no variable.
No, I'm just asking the lignite price -- because your tariff is INR 4.9 because for 1 unit of power you require 1 kilo of lignite. So that is not reflecting in new prices. So that is what I'm asking, whether we will increase the gap prices for transport price for the power plant.
See, it is parallelly as all regular parallelly, the coal price also increased. So the variable cost of the whole to power plant will increase.
My I request you to please rejoin the queue.
About the corporate segment performance...
In the last quarter, we have awarded very high-value consultant on obviously so we have booked a expenditure in the context admin. Due to that, the profit has gone down later.
The next question is from the Mahindra Manela Mutual Fund.
Yes. Sir, congrats on a good set of numbers. Just one clarity on this trade receivables, which was INR 1,452 crore last year has gone to INR 2,049 crore this year-end. So that's a INR 600 crore increase. So of this INR 600 crore increase, I think one of your management person had told some you have received back in April. So how much was that quantity you had received back? And where are these receivables currently? Why it has increased by INR 600 crores. Any particular [indiscernible] renewables. So how much portion is that renewable if you can quantify, that would be appreciated.
I can take them together and then redeploy. Is that the only question?
Yes.
Okay. I will request CFO, Mr. Kulshrestha, to advise on that.
Actually, sir, last year, INR 145 crores. And this year, trade receivables are INR 204 crore. and Anupma Iyer had already given the answer that we have recorded around INR 80 crores from [indiscernible] most of the amounts have to be recurred from [indiscernible].
How much from compared to last...
It is only INR 60 crores not INR 600 crores.
Okay. But when...
Not in crores.
I will repeat at INR 145 crores last year, INR 204 crores.
And in your -- as a follow-up in your cash flows also, like, if I look at adjustment for trade and other receivables, if you look at the cash flow, so there is -- last year, it was INR 127 crore increase. And this year, it is INR 913 crore increase in trade and other receivables if you open your cash flow statement consolidated.
Actually, INR 700 crores is related which we have invested in GSFS. If you exclude that amount, then it will report it, sir.
GSFA.
GSFS. Gujarat State Financial Services, sir.
Okay. We have invested INR 700 crore. But how can that come in the trade and other receivable? I didn't get?
We have classified it as investing activity, but as for discussion with [indiscernible] doing it in operating and loading. As for next year, we can discuss it and transfer into the investing activity. But mainly [indiscernible] INR 700 crores investment with GSFS, which has increased.
Sorry to interrupt. May I request Mr. [ Ranjit ] to please rejoin the queue, sir. We have participants waiting for their turn. The next question is from the line of Mohammed Patel from Care Portfolio Managers.
My first question is that you were going to give more details on your association with BCG in this quarter. So can you please throw some light on that? Second question is what is the potential for nonlignite business going ahead and if you could summarize it?
So any other questions, please? Or is this only one?
Two questions. First is the association with BCG. Second is the potential for nonlignite business going ahead.
Potential of nonlignite business.
Yes.
So 2 very large questions. I would request the first 1 to be taken by Mr. Swagat Ray and to be filled up later by Mr. H.K. Joshi, who's the mentor of the strategic transformation.
Hello. As far as the engagement of BCG strategic transformation is concerned, I would like to inform you that BCG's activity is 2 months older activity -- and in the initial stage, they are collecting or gathering the information. They are trying to understand the basic [indiscernible] system of the GMDC. And hopefully, in the next week, we will have some concrete deliverables from their end as far as this Part 1 is concerned. So Part 1 is basically about understanding of our systems and a different way of working methodology and other opportunities that we can explore. So in the next one week, we will be able to understand their views and their deliverables, and that's we will proceed further. Is that good enough?
And I think Mr. Joshi to [indiscernible] as the mentor of the [indiscernible].
The CGI Has been voted by GMDC for strategic transformation. Part -- the first part, 2 months of the first part as in completed, and they have met some reports. These are confidential reports, but they are good enough for the company. And after one week, we are going to give us a presentation of all the scenario and very next meeting we will be able to explain to you what type of transfer of funds we are going to take for the [indiscernible].
And for the nonlignite business also Mr. Joshi, you can...
The nonlignite business for the region of our company and our for entry, we are defining our lignite mining and lignite business. But then associated minerals, we are having a local portfolio like silica sand, short stock, multimetal, limestone, and we are making strategy for all terminals with the help of BCG and that suggests we can stay only at 50% of the business in coming years will be from non-lignite. Is it enough, sir?
A major part in non-lignite business.
Pardon?
Which will be the major part in the non-lignite business, which metal will be the major part?
We are having precious metals, multimetal project. We are having limestones. So we are having a good portfolio of nonlignators.
[Operator Instructions] [indiscernible] from Centrum Capital.
Two questions. One is, when you're talking about the expansion that is from 3.5% to middle of next year, from which mine we can give this kind of volume. I think this is from the existing mine [indiscernible] and from which mine we can say. Secondly, we have been lots of mines earlier also nice the tenant. But we haven't seen anything coming out from there. So when can we expect some output from any of the new mines and this year? That's my first question.
And second question is on alumina price. Is it possible to share what could be the exit Q4 lignite [indiscernible] price versus fourth quarter average?
Okay. So I would request General Manager Geology and Land Associates to take a call on which mines will lead the production chart from the existing portfolio? And what is the outlook on the upcoming titles project. For pricing, could you please repeat the question? [indiscernible]
As far as concern to resource of the lignite, we have a very good reserve in Bhavnagar, so we will concentrate on Bhavnagar in coming days. Along with that, we are also planning to increase our portion from our [ sanitation ] mine. And as far as concern to new lignite block, Lakhpat is in the promising stage, which will be followed by [ Waria ] where we have a use reserve around 300 million to 400 million tonnes, and that will be targeted.
When can we expect production to come from in near minimum?
In the range of 1.5 to 2 years? And the pricing question, if you could repeat it.
My pricing question was that what was the weighted average of lignite price at the end of 4 quarters versus fourth quarter average because we have been [indiscernible] in core quarter. So we did the price in the higher than that -- and typically, what kind of discount we offer to plan as compared to imported coal at a...
As far as my understanding is concerned, you are asking about the [indiscernible] lignite price of quarter 4, am I right?
No, sir. Quarter 4, you mentioned it was, I think, INR 4,000 to INR 4,200. I'm saying or you can say as of now, what would be the in what of quarter.
Last month of quarter four. Was in fact still about last part of quarter for that is precisely during the month of March, calendar month March 2022.
The calendar month, April onwards.
April pertains to the financial year 2022/'23, however, will be again in 3 of the mines the prices will be around INR 3,800, and in another mine, it is INR 4,400. And in the next mine, it is INR 5,400. So these are the figures. And again, there are so many segments. This is a broad figure to actually answer your question.
The next question is from the line of [ Chirag H ] from [ BMO ].
So just regarding the rare earth mineral, so I mean, whenever you apply for the mining rights offer, how much confident are you in terms of securing the mining rights, or do you see a risk of these mining rights being allotted to other companies like uranium corporation of India or Coal India like that?
The second question, please?
That's the only question I have.
I would request General Manager [indiscernible] to take the question.
As far as control, we have to wait for certain things, certain amendment in the act, and we can reply properly after 3 to 4 months.
But I mean do you feel that these binding rates could be allotted to the other companies like Uranium Corporation of India or maybe Coal India, like that?
Recently, in the amendment in the atomic mineral, a state government corporation has allowed for the mineral concession of the RE, and are I think we have to look into that.
The next question is from the line of Akshay Kothari from Envision Capital.
I just wanted to know the potential of your joint venture or your investment in Gujarat Credo also. Can you give a light on that? And secondly, my second question was related to that investment in GSFS. So can you give light on that as well?
I would request Mrs. Anupma Iyer to give you a perspective of what GSFS is and what those investments yield, and how is it better and beneficial for the company and any other questions you may have. And I would request Mr. Rajat Dash to give a perspective on the JV with Credo.
Hello. GSFS, Gujarat State Financial Services, is a wholly owned venture of government of Gujarat. And as the government of Gujarat, we are required to invest our surplus plus 1 percent. At present, to sell entire funds, except GSFS and at then, we are getting rate of interest for 5.25% from them for the 1 to 3 years at least.
Okay.
Regarding this one for Credo, GMDC this year entered into a joint venture with Credo. They are producing. They are basically producing geolight from low-grade bauxite, and they are placed close to our mine site versus a -- and they are sourcing bauxite by virtue of the joint venture conditions. They are sourcing bauxite from various mines of [indiscernible] group of mine, with various projects of bauxite mine, and they are into the value addition of this low-grade bauxite, and they are the only on the player in this field to have this value addition of low-grade bauxite. So GMDC is a minority partner in this journey.
Okay. And can you give some light on the uses of geolight, what are the potentials which this can generate?
These geolight are basically detergent grade geolights, and in India, I think that we used to produce these kind of geolights. And there is an encouraging market space in India. So that -- so there is a demand for this geolight. And the application is very -- in the detergent sector, I presume.
Ladies and gentlemen, this was the last question for today. I would now like to hand the conference over to the management for closing comments.
[indiscernible] our Company Secretary [indiscernible]
[indiscernible] everyone. We express our sincere gratitude and thanks to every participant who participated in this conference call. We believe that all your questions and queries have been answered to your satisfaction. And we thank our soft management, our Managing Director for spending their valuable time to join this earnings call. And we also thank our -- all stakeholders with the continued interest in the working and operation and future outlook of the company. Thank you.
Thank you all for being a part of the conference call. For any information or clarification, please e-mail gaurav.g@conceptvr.com.
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