Coal India Q2 Results: Profit Down 50%, Misses Estimates

Coal India’s consolidated net profit fell 50.2% sequentially in the September quarter to Rs 4,354 crore, compared with Rs 8,743 crore in the previous quarter, missing Bloomberg’s estimate of Rs 5,692 crore, according to its notification to the exchanges on Wednesday.

Revenue dropped 15.8% quarter-on-quarter to Rs 30,187 crore from Rs 35,842 crore, broadly in line with Bloomberg’s forecast of Rs 30,394 crore.

• Revenue down 15.8% to Rs 30,187 crore versus Rs 35,842 crore (Bloomberg Estimate: Rs 30,394 crore).

• Ebitda down 46.4% to Rs 6,716 crore versus Rs 12,521 crore (Bloomberg Estimate: Rs 8,409 crore).

• Margin at 22.2% versus 34.9% (Bloomberg Estimate: 27.7%).

• Net profit down 50.2% to Rs 4,354 crore versus Rs 8,743 crore (Bloomberg Estimate: Rs 5,692 crore).

The decline was led by lower operating income and higher inventory build-up. After posting the second quarter results, Coal India stock fell as much as 2.49% during the day to Rs 381.6 apiece on the NSE.

It was trading 2.04% lower at Rs 383.4 apiece, compared to an 0.43% advance in the benchmark Nifty 50 as of 2:09 a.m.

It has declined 14.14% in the last 12 months and delcined 0.25% on a year-to-date basis. The total traded volume so far in the day stood at 5.1 times its 30-day average. The relative strength index was at 38.80.

Sixteen out of the 25 analysts tracking the company have a 'buy' rating on the stock, five recommend a 'hold' and four suggest a 'sell', according to Bloomberg data. The 12-month analysts' consensus target price on the stock is Rs 407.2, implying an upside of 6.1%.

Most analysts were expecting lower volumes and subdued earnings on the back of weak power demand and elevated inventory levels. The slowdown in thermal generation has weighed on offtake, while global coal price softness has kept e-auction premiums under pressure.