Covid-19 impact: Demand, pricing pressures to weigh on Coal India

After hitting all-time lows last month, shares of Coal India (CIL) have recovered by about 10 per cent. While a part of these gains were led by stock valuations hitting a trough, some relief for CIL was also expected with the resumption of business and industrial activity, leading to some uptick in coal demand from thermal power generators and other end-user industries.

However, the benefits are likely to be limited, and the persisting challenges will likely limit significant upside. This is also a reason why the 10 per cent gain in CIL’s share price since March lows is lower than the 23 per cent rise in Sensex during this period.