India's coal inventory is at its highest in the last 22 months, as per data provided by the Central Electricity Authority of India.
Coal stocks rose around 2.5 times from 9.5 million tonnes to almost 23 million tonnes since Oct. 23 last year whereas the spot power price, that declined over the last two months, is trading at Rs 3,006 per megawatt hour, according to India Energy Exchange.
Coal India Ltd.'s dispatch to power sector increased by 14 percent to 126 million tonnes for the three months ended December on a quarterly basis, as per the company's exchange filings.
Coal will continue to be the key driver for power generation with Coal India accounting for almost 83 percent of the total domestic production, Motilal Oswal said in a report.
The over-stocking of coal when power generation has stayed unchanged paved the way for increase in productivity levels, Vinit Bolinjkar, head of Equity Research at Ventura Securities said.
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