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Centrum Broking Report
Coal India Ltd. reported lower than estimate Ebitda excluding over burden removal at Rs 86.3 billion (our estimate: Rs 138.6 billion), down 30% YoY/ 23% QoQ. This is due to higher employee cost provisioning of Rs 58.7 billion (Q3 FY23: Rs 15.5 billion).
With this, Coal India has made full provision of agreed wage hike of 19% which is effective from July 01, 2021. Overall sales was up 17% YoY on account of fuel supply agreement sales volume (up 11% YoY) and realisation (FSA up 5% YoY and e-auction up 86% YoY).
The e-auction price have declined sequentially, though remained up 86% YoY at Rs 4525/tonne. Coal India announced Rs 4/share dividend during the quarter. Total dividend for FY23 stands at Rs 24.25/share giving yield of 10-11%.
We increase our coal volume by 1%/1% and price estimate by 5%/2% for FY24 and FY25 respectively.
We have factored in conservative E-auction price at Rs 3000/tonne for FY24 and Rs 2045/tonne for FY25 (versus FY23: Rs 5000/tonne; Q4 FY23: Rs 4525/tonne), which accounts for possibility of decrease in prices. As a result, our estimated Ebitda by 16% and 2% respectively.
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