Coal India Ltd. share price target

Coal India (CIL) reported a strong quarter (EBITDA Rs 49.3bn, 9.7% YoY, 96% QoQ), driven by offtake growth (137.9 mT, 10.7% YoY) and moderation in employee costs (Rs 73.5 bn, -1.8% YoY, 2.3% QoQ).

Coal India (CIL) reported in line consolidated net sales of Rs195.9bn, up by 7.0% yoy in 3QFY16 in line with our expectation, due to higher coal off-take at 9.4% yoy. However, reported PAT, which was up by 13.9% yoy to Rs37.1bn came above our expectation due to better-than-expected operating margins. CIL has corrected recently by 30% as the GoI intends to disinvest 10% stake & a fall in e-auction coal prices which we believe is already discounted at the current valuations. We believe that the positive initiatives taken by the Ministry to address fuel issues are expected to bring faster developments on policy front....

Coal India (CIL) reported a weak quarter (EBITDA Rs 25.2bn, -4.1% YoY, -50.6% QoQ) as e-auction prices declined sharply (Rs 1,788/t, -28.4% YoY, -18.1% QoQ) following a drop in demand in the power and non-power sectors.

For 2QFY2016, Coal India (CIL) reported a strong 8% yoy increase in revenue to Rs16,958cr, in line with our estimate of Rs16,833cr. Off-take volumes were marginally ahead of our expectations at 121.8MT (our estimate was of 119.1MT). Off-take was higher in the FSA segment with e-auction and washeries volumes in line with expectations. FSA realizations were in line with expectations at Rs1,294/T. However, e-auction realizations came in much lower than expected at Rs1,788. Blended realization/tonne came in lower than our expectation at Rs1,392 (1.5% lower than our estimate of Rs1,414), led by the sharply lower e-auction realisation. Blended realisation declined 2% yoy, while off-take increased 10.2% yoy, resulting in an 8.2% increase in net sales. The EBITDA, at Rs3,008cr, came in 3.2% lower than our estimate, resulting in a 140bp improvement in EBITDA margin to 17.2%, marginally lower than our estimate of 17.9%. Net profit at Rs2,544cr was slightly ahead of our estimate of Rs2,445cr. Outlook and valuation We reduce our consolidated FY2016 and FY2017 EPS estimates by 12% and 9%, respectively, in view of the lower than expected realizations and increased operating expenses. We expect CILs production to increase by 7.1% to 530MT in FY2016 (538MT earlier) and 572MT...

8 Coal India's earnings (Rs 25.4bn; +15% yoy) were lower than our (Rs32bn) and consensus(Rs30bn)estimatesonweakrealisationsandhigheroperatingcosts. 8 Eauction realisation (Rs 1793/tonne) declined sharply by 28% yoy due to lower...

Coal India (CIL) reported in line consolidated net sales of Rs174.8bn, up by 8.2% yoy in 2QFY16, due to higher coal off-take (10.4% yoy). However, reported PAT, which was up by 16.0% yoy came in at Rs25.4bn, below our expectation of Rs27.5bn due to lower-than-expected operating margins. CIL has corrected recently by 25% as 1) the GoI intends to disinvest 10% stake and, 2) fall in e-auction coal prices is near term overhang on the stock. Earlier in the similar divestment event, stock did recover sharply post 10% stake sale in January, 2015. We believe that the positive initiatives taken by the Ministry to...

total offtake for the quarter increased 3.7%, leading to a 3.9% jump in revenues EBITDA margin increased 45bp yoy to 26% as higher staff costs and contractual expenses were offset by revenue growth and lower material and provisioning expenses. EBITDA stood at Rs 5,399crs....

PAT hit by operating cost; Strong fundamentals intact Coal India (CIL) reported Rs195bn consolidated net sales in 1QFY16, in line with our expectation (Rs192bn) as compared to Rs183bn in 1QFY15, due to higher coal off-take (8.2%) yoy. However, reported PAT was down by 6.7% yoy to Rs37.6bn below our expectation of Rs44.0bn due to lower operating margins, lower other income & higher provision for tax. We like Coal India due to its strong balance sheet, huge reserves & strong fundamentals. We believe that the positive initiatives from Ministry to address fuel issues are expected to bring in faster developments...

6 coal blocks will be auctioned to non-regulated sector participants in Round III of the process that kick-started in February 2015. We expect the bidding aggression seen in the initial 2 rounds to moderate, given the hope of an improved domestic fuel supply situation as Coal India?s off-take accelerates.