How India's most expensive limestone block in Chhattisgarh was auctioned

Dalmia Cement emerges the preferred bidder

After nearly 24 hours of record bidding, with 600 bids coming in, the country’s most expensive limestone block in Chhattisgarh finally went to Dalmia (Bharat) Cement.
 

The Kesla-II limestone block in Raipur district of Chhattisgarh with an estimated reserve of 215 million tonnes was put for auction. The reserve price of the block, spread across 357 hectares of area, was fixed at 5 per cent of IBM prices while the floor price was 21 per cent of IBM prices.
 

Four prominent cement makers, including Dalmia (Bharat) Cement, Adani, UltraTech and Mangalam Cement submitted the bids. Adani reportedly did not participate in the bidding that left three in the fray even as bidding started on Monday at 11 am.

While the bidding price kept on escalating, UltraTech also opted out from the race. Dalmia (Bharat) Cement and Mangalam Cement were in no mood to give up. In all, 600 bids were submitted during the nearly 24 hours bidding that ended on Tuesday morning with the highest bid received at 96.15 per cent of IBM prices. It was 20 times more than the reserve price.
 

A senior company executive associated with the bidding told Business Standard that Mangalam Cement was desperate to get the block as the adjoining Kesla-1 was bagged by Century Cement. The company officials could not be contacted.

The highest bid received translates into estimated cumulative revenue of Rs 11,894 crore to the Chhattisgarh government over the lease period. The figure is more than Rs 8,215.8 crore raised by the auction of Ghoraburhani-Sagashi iron ore block in Odisha, the highest revenue earner till date.
 

Chhattisgarh has broken the national record of obtaining the highest bid for any limestone block that was previously held by Rajasthan at 67.94 per cent of IBM prices for its limestone block of Nagaur District.
 

“Choice of the blocks, fixation of the tender parameters and consultation with industry participants demonstrated the business acumen and foresight of the Mining Directorate officials played a major role in the success of the auction,” Mining Secretary Subodh Kumar Singh said.
 

Notably, Chhattisgarh had also earned the distinction of conducting the first ever successful non-coal mineral auction in India in February, 2016 with the auction of Karhi Chandi limestone block.