Q2FY23 Preview: Coal India: Revenue seen at Rs301,319 million, PAT at Rs41,229 million

7 Nov 2022 , 09:45 AM

Result date: 7^th November, 2022
Recommendation: Buy
Target price: Rs290
(Source: IIFL Research)

Robust demand and better prices amid global shortage of coal and surge in demand of power could aid revenue growth for Coal India in the September 2022 quarter. The company’s Q2FY23 coal dispatch stood strong at 154MT (up 5% over the year-ago quarter), taking the H1FY23 coal dispatch to 332MT, an increase of 8% over the year-ago quarter. With this, Coal India achieved ~43% of its coal production target of 700MT for the full year.

Coal India’s EBITDA could increase significantly, in sync with the jump in revenues relative to the year-ago quarter. Favorable coal mix (higher e-auction premium) is another factor aiding EBITDA margin during the quarter.

The company’s Profit After Tax (PAT) could jump ~142% over the year-ago quarter, further aided by stable fixed costs.

Important management insights to watch out for:

• Outlook on international coal prices
• Pickup in e-auction volumes

Rs. Million	September 2022 estimates	QoQ change	YoY change
Revenue	301,319	(14.00)%	29.25%
EBITDA	99,657	(18.55)%	153.00%
Profit After Tax	41,229	(19.20)%	142.25%

Source: Brokerage Reports