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Coal India rallies 4% on decent quarter; brokerage retains 'Buy' on stock

At 11:43 AM, the shares of Coal India were trading 3.41 per cent higher at Rs 468.70 per share on the BSE. In comparison, the S&P BSE fell 0.66 per cent to 74,117 levels

Coal India

Wages of non-executive workers, which account for 94% of Coal India’s workforce, are revised every five years.

SI Reporter New Delhi

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Shares of Coal India shot up by 4.1 per cent at Rs 472 a piece on the BSE in Friday’s intraday trade. This came after the company delivered a decent growth in its fourth quarter results for financial year 2023-24 (Q4FY24)

The national miner Coal India reported a 17.8 per cent jump in its year-on-year (Y-o-Y) profit at Rs 37,369 crore for the financial year 2023-24 (FY24). The revenue from operations rose minimally by 3 per cent to Rs 1.38 trillion during FY24, while the net income was up by a similar quantum to Rs 1.5 trillion.

The company’s board recommended a final dividend of Rs 5 per share for the financial year ended March 2024. This was in addition to the interim dividend of Rs 20.50 per share CIL had already paid earlier in the fiscal. Thus, the total dividend for the fiscal climbs to Rs 25.50 per share which is 255 per cent of the face value of a single share, the company said. 

“The company’s Ebitda, buoyed by positive operating performance, rose to Rs 51,793 crore, registering 8.5 per cent growth against Rs 47,723 crore of the previous fiscal year. During FY 2023-24, the state-owned coal mining behemoth contributed Rs 60,140 crore to the government exchequer, both central and the states where it operates,” CIL said in a statement.

Brokerage firm, Nomura Institutional Equities in a result update said that during Q4FY24, Coal India reported lower-than-expected Ebitda of Rs 9,843 crore, down 18 per cent quarter on quarter and missing the brokerage’s estimate. 

This fall in Ebitda was attributed to lower e-auction price and higher operating expenses, partly offset by higher volume. Analysts at Nomura further noted that higher working capital led net cash to fall to Rs 272 billion. 

“Employee cost to normalise in FY25. We expect CIL to post 5 per cent volume CAGR on improving power demand in FY24–26E. We cut FY25E Ebitda by 2 per cent factoring in higher employee cost. We reduce target price to Rs 537 from Rs 561. Retain ‘BUY’,” analysts wrote in a report. 

At 11:43 AM, the shares of Coal India were trading 3.41 per cent higher at Rs 468.70 per share on the BSE. In comparison, the S&P BSE fell 0.66 per cent to 74,117 levels. The stock of the company is currently trading at a price to earnings multiple of 18.53 times, shows data. 

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First Published: May 03 2024 | 11:55 AM IST

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