Major Contract Award
KNR Constructions Receives ₹3,361.11 Crore Coal Mining Contract from South Eastern Coalfields
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KNR Constructions Limited has received a Letter of Acceptance (LoA) from South Eastern Coalfields Limited (SECL) for coal mining works at the Kusmunda Open Cast Project in Chhattisgarh. The contract, awarded to the KNR-SIMI Joint Venture, carries a value of ₹3,361.11 crore (excluding GST) and has an execution period of 2,920 days, significantly strengthening the company’s mining order book.
PRICE-SENSITIVE TRIGGER
Event: Receipt of Letter of Acceptance (LoA) for coal mining contract.
Type: Major Contract Award
Impact: Positive
Immediate Effect: The award adds a large long-term mining contract to KNR Constructions’ order backlog and expands its presence in the coal mining services segment through the KNR-SIMI Joint Venture.
Key Metrics:
- Contract Value: ₹3,361.11 crore (excluding GST)
- Project Duration: 2,920 days
- Joint Venture Structure: KNR Constructions (51%), Sushee Infra & Mining (49%)
- Coal Quantity Covered: 142.89 million tonnes
- Minimum Daily Coal Production (TPD): 48,934 tonnes
- Total Overburden Quantity: 258.15 million cubic meters
- Minimum Overburden Production (QPD): 88,410 cubic meters
Highlight:
- The ₹3,361.11 crore mining contract represents a large long-duration infrastructure and mining services order, providing revenue visibility for nearly eight years.
What Happened ?
KNR Constructions informed stock exchanges that the KNR-SIMI Joint Venture received a Letter of Acceptance from South Eastern Coalfields Limited for execution of coal mining works at the Kusmunda Open Cast Project in Chhattisgarh. The contract covers excavation, transportation, coal extraction, loading, and associated mining activities on an item-rate basis for a period of 2,920 days.
The project includes overburden removal, coal excavation, loading through pay loaders, transportation through tippers, and surface mining operations across multiple coal seams within the Kusmunda mining area.
Key Details
Kusmunda Coal Mining Contract:
- Contract awarded by South Eastern Coalfields Limited (SECL).
- Executed through KNR-SIMI Joint Venture with KNR holding a 51% stake.
- Total contract value stands at ₹3,361.11 crore excluding GST.
- Project location is Kusmunda Open Cast Project, Chhattisgarh.
- Contract tenure is 2,920 days.
- Job 1(A) covers excavation and transportation of soft soil and excavated material.
- Job 1(B) covers excavation of hard strata, overburden removal, drilling, loading and transportation activities.
- Total overburden quantity under the project is approximately 258.15 million cubic meters.
- Surface miner operations include excavation and cutting of coal and coal measure strata.
- Coal extraction contract covers approximately 142.89 million tonnes.
- Coal loading and transportation activities include movement from mine faces to designated stockyards, sidings and conveyor receiving points.
- Minimum daily coal production requirement is 48,934 tonnes.
Note:
- The project strengthens KNR Constructions’ mining portfolio and provides long-term operational visibility due to its extended execution period and large production volumes.
Risk Analysis
Summary:
- While the contract materially strengthens the order book, execution remains dependent on mining productivity, regulatory compliance, operational efficiency and commodity-linked mining activity levels.
Key Risks:
- Long-duration projects carry execution and cost-management risks.
- Mining operations remain subject to environmental and regulatory requirements.
- Achievement of minimum production obligations is critical.
- Delays in site operations or logistics may affect execution schedules.
- Joint venture execution requires coordination between partners.
Worst Case Scenario:
- Operational disruptions, regulatory delays, production shortfalls or cost overruns could impact project profitability and execution timelines.
Risk Level: Medium
Company Commentary
- KNR Constructions confirmed receipt of the Letter of Acceptance from South Eastern Coalfields Limited.
- The contract has been awarded to KNR-SIMI Joint Venture.
- Mining activities will be carried out at the Kusmunda Open Cast Project in Chhattisgarh.
- The contract will be executed on an item-rate basis for a period of 2,920 days.
- The company also informed that the trading window for designated persons will remain closed from June 8, 2026 to June 9, 2026 under its Insider Trading Code.
Official Exchange Filing: KNR Constructions Limited