Coal India - FY24 Operating Performance Surpasses Our Estimates: ICICI Securities

ICICI Securities Report

Coal India Ltd.’s FY24 operating performance was better than our expectation. Key points:

1. Sales, production volumes were up 8.4% YoY, 10% YoY – both slightly ahead of our estimates;

2. supply to power sector exceeded demand by 8.5 million tonne;

3. supply to non-regulated sector was up 25% YoY at 135 mt;

4. better grade conformity and rake availability compared to FY23; and

5. pit-head inventory at end-March 2024 stood at 90 mt (43 days of sales).

Going ahead, management has indicated production, sales volume target of 838 mt each, implying production and sales growth of 8.3% YoY and 11.2% YoY, respectively.

In comparison, our estimates stand at 820 mt and 811 mt for production and sales volume, respectively. We maintain Add on Coal India with an unchanged target price of Rs 500 on 8.5 times FY26E earnings per share.

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