After 3 years, OMDC begins mining at Kolha Roida, Dalki

After being out of business for the last 3-4 years, Kolkata-based iron ore miner Orissa Minerals Development Company (OMDC) has restarted mining operations from two of its mines from Thursday, December 29.

That would mean a substantial revenue and volume boost at a time when India’s steel production is getting crippled due to lack of iron ore supply.

According to company officials, after resuming operations from its Kolha Roida iron ore and Dalki manganese mine from Thursday, next on the agenda is starting the other closed mines — located at Barbil in the Keonjhar district of Orissa — by next fiscal.

Satish Chandra, managing director of the company, refused to comment on the resumption, but experts said the company will be able to ramp up the production next fiscal.

They, however, harbour concerns over the company’s execution skills.

“OMDC has had a poor execution track record in the last several years. The company is now a subsidiary of Rashtriya Ispat Nigam Ltd and that is a upside for it as it can source world-class expertise from the Vizag parent,” said an analyst with a portfolio management company, who did not wish to be named.

RINL is a navaratna steel company and majority shareholder of OMDC.

AP Choudhary, RINL chairman, was given additional responsibility as non-executive chairman of OMDC last May.

OMDC had planned to start production from both mines by April last and based on this, had projected a substantial revenue growth for the current fiscal.

“Considering Kolha Roida started operations by April, the company had projected a revenue of Rs240 crore and gross margins of Rs180 crore. Now we expect the company to have a revenue of at least Rs300 crore and similar margins for the next fiscal,’’ the analyst said.