Coal India’s Offtake Rises For Ninth Straight Month, Output Lags FY21 Target

Coal India Ltd.'s shipments rose for the ninth straight month, albeit at a slower pace.

Dispatches of the world's largest miner of the fossil fuel rose 1.3% over the preceding month in January 2021, according to an exchange filing. Year-on-year, however, it fell 5%—the steepest since July 2020.

A 22.5% and 33.2% decline in volumes of subsidiaries Eastern Coalfields Ltd. and Bharat Coking Coal Ltd., respectively, dragged the state-owned miner's overall shipments.

According to Vishal Chandok, analyst at Emkay Global, Coal India's offtake has improved in every month of FY21, aided by better demand and partial replacement of imports with domestic production.

Output Trend

Coal India's production fell over the year earlier for the first time since July 2020.

The miner's output declined 4% year-on-year in January but rose 3.77% over the preceding month, the filing said. That came as output of South Eastern Coalfields Ltd.'s—which contributes to 25% of Coal India's production—dropped close to 3% over the year earlier.

Coal India has produced 462.9 million tonnes of the fuel during April 2020-January 2021, a 2.2% fall from the year-ago period. That's also lagging the company's revised production target for the ongoing fiscal.

Coal India has lowered its production target to 650-660 million tonnes for the fiscal ending March 2021 from 710 million tonnes predicted earlier amid disruptions caused by the Covid-19 pandemic.