Coal India (CIL) has reported a 10% y-o-y decline each in August production and sales volume, now down to their lowest levels in the past three years. Key highlights: (i) Larger subsidiaries MCL (Mahanadi Coalfields Ltd) and SECL (South-Eastern Coalfields Ltd) accounted for the bulk of the decline; (ii) continued low rake availability \u2013 down to 178\/day in August from 205\/day in July\u2014dampened offtake; (iii) production volume was hit by fatalities at MCL and SECL and higher-than-normal rainfall. That said, we expect an uptick in production\/offtake Q3 onwards as: (i) weather-related issues subside; (ii) rake availability improves; and (iii) production normalises at MCL and SECL.
\nHence, we do not believe our FY20e volume growth of 4.6% is at risk, but note that CIL\u2019s target of 8.5% is daunting. That said, a healthy dividend yield and free cash flow are positives. Maintain Buy with a TP of Rs 235 (8.6x FY21e EPS).<\/p>\n","protected":false},"excerpt":{"rendered":"
Coal India (CIL) has reported a 10% y-o-y decline each in August production and sales volume, now down to their lowest levels in the past three years. Key highlights: (i) Larger subsidiaries MCL (Mahanadi Coalfields Ltd) and SECL (South-Eastern Coalfields Ltd) accounted for the bulk of the decline; (ii) continued low rake availability \u2013 down to 178\/day in August from 205\/day in July\u2014dampened offtake; (iii) production volume was hit by fatalities at MCL and SECL and higher-than-normal rainfall. That said, we expect an uptick in production\/offtake Q3 onwards as: (i) weather-related issues subside; (ii) rake availability improves; and (iii) production […]<\/p>\n","protected":false},"author":44,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[198,130,138],"tags":[],"class_list":["post-290877","post","type-post","status-publish","format-standard","hentry","category-coal-the-financial-express","category-newspapers","category-the-financial-express"],"acf":[],"_links":{"self":[{"href":"https:\/\/infralive.com\/web\/wp-json\/wp\/v2\/posts\/290877","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/infralive.com\/web\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/infralive.com\/web\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/infralive.com\/web\/wp-json\/wp\/v2\/users\/44"}],"replies":[{"embeddable":true,"href":"https:\/\/infralive.com\/web\/wp-json\/wp\/v2\/comments?post=290877"}],"version-history":[{"count":0,"href":"https:\/\/infralive.com\/web\/wp-json\/wp\/v2\/posts\/290877\/revisions"}],"wp:attachment":[{"href":"https:\/\/infralive.com\/web\/wp-json\/wp\/v2\/media?parent=290877"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/infralive.com\/web\/wp-json\/wp\/v2\/categories?post=290877"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/infralive.com\/web\/wp-json\/wp\/v2\/tags?post=290877"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}