Coal India's share price gained 3.94% to ₹417.40 during Wednesday's trading session after the state-run miner reported strong growth in coal supplies in August and the first five months of FY27. The latest surge comes as investors respond positively to the company's strong operational performance and supply growth momentum. According to The Economic Times, the operational update, along with a bullish outlook from brokerage firm Nuvama, boosted sentiment around the stock. The company has received significant analyst attention, with 25 analysts covering Coal India, of which 14 have a 'buy' rating, six say 'hold', and five have a 'sell' rating. Notably, Nuvama upgraded the stock to 'hold' from 'reduce' and raised its price target to ₹454 from ₹396, citing recovery potential and expecting Coal India's e-auction volumes to reach around 100 MT annually in FY27E and FY28E.
Coal India's share price is expected to remain in focus following a 5.5% rise in coal supplies to 60.60 million tonnes (MT) in August 2026, compared with 57.40 MT in the year-ago period. According to provisional operational data filed by the company with stock exchanges, Coal India produced 47.52 MT of coal in August, down 5.72% from 50.40 MT produced in August last financial year. The company has successfully liquidated around 55 million tonnes of pithead stocks during the first five months of FY 2026-27, even as it retains approximately 76 MT of inventory to support power generation requirements. The company's total coal supplies in the first five months of 2026-27, through August, stood at 322.90 MT, up from 302.60 MT in the corresponding period of the previous year, marking a 6.7% growth. As per The Economic Times, supplies to the power sector rose 4.5% during the month to 48.46 MT, compared with 46.39 MT in August FY 2025-26, while supplies to the non-regulated sector (NRS) registered growth of 9.6%, rising to 12.12 MT from 11.06 MT last year.
Coal India's e-auction premium performance has emerged as a key growth driver, with e-auction premiums growing 59% from the comparable period and 46% for the April-August 2026 period compared to 35% between April-August 2025. As per CNBC TV18, this strong premium performance reflects improving market conditions and pricing power. UBS highlighted that the decline in production also allowed the liquidation of 55 MT of pithead coal inventories in the first five months of this financial year. The improvement in e-auction premiums is supported by higher global thermal coal prices, with Nuvama expecting Coal India's e-auction volumes to reach around 100 MT annually in FY27E and FY28E. Nuvama has also raised its FY27E and FY28E EBITDA estimates by 13% and 8% respectively, citing the recovery potential and strong operational performance.
Coal India's production in August stood at 47.52 MT, down 5.72% from 50.40 MT produced in August last financial year. Among Coal India's subsidiaries, Eastern Coalfields reported the strongest performance with a 39.5% rise in August production, while Western Coalfields and Central Coalfields recorded growth of 24.7% and 19.5% respectively. However, production declined 24.8% at Northern Coalfields, 10.2% at South Eastern Coalfields and 10% at Mahanadi Coalfields during the month. Coal India's cumulative production during April-August stood at 267.50 MT, down by 4.50% from the corresponding period last year. The company's coal production target for the current fiscal year is 815 MT, and the offtake target for 2026-27 is 850 MT.
Thermal power generation growth and elevated imported coal prices are expected to support domestic demand for Coal India's products. Coal and lignite-based power plants accounted for 69.54% of the electricity supplied in the country during April-June 2026, according to a Ministry of Power reply in the Rajya Sabha. HSBC expects Coal India's e-auction prices to rise further due to coal inventories falling to three-year lows and regional coal prices surging. The brokerage maintains a 'hold' rating with a price target of ₹440, noting that strong power demand and weak hydro generation create strong coal demand. Morgan Stanley is 'equalweight' on Coal India with a price target of ₹420. Beyond near-term volume recovery, Nuvama expects Coal India's coal gasification, power generation and critical minerals businesses to emerge as longer-term growth drivers, with these initiatives starting to deliver meaningful benefits over the next four to five years.
