Coal India shares fell 2.10% to ₹384.85 on Friday morning, a day after the state-run miner reported September quarter results. According to The Hindu BusinessLine, the stock opened higher at ₹398 and touched an intraday high of ₹398.05, but quickly reversed to a low of ₹380.40 as investors digested the operating profit miss. Over 1.06 crore shares had changed hands by mid-morning, with 58% of buy orders against 42% sell orders. The stock is trading well below its 52-week high of ₹491.25 hit in April and has shed nearly 9.5% over the past month.
Coal India reported Q2FY27 revenue of ₹44,170 crore, up 21% year-on-year, though adjusted EBITDA rose 28% year-on-year to ₹7,400 crore while falling sharply quarter-on-quarter. As per The Hindu BusinessLine, PAT came in at ₹6,500 crore, up 52% year-on-year. The company faced a significant EBITDA miss with adjusted EBITDA of around ₹73.9 billion, approximately 37% below estimates, largely because the company aggressively liquidated inventory. Despite the earnings miss, brokerage reactions were mixed with JM Financial maintaining an ADD rating and revised target of ₹438 (down from ₹458), while Motilal Oswal reiterated a BUY with revised target of ₹450.
The board approved a second interim dividend of ₹10.25 per share for TY 2026-27, taking total dividends in the first half to ₹15.75 per share with record date set for November 4, 2026. According to The Hindu BusinessLine, rising international coal prices could support higher e-auction premiums and realisations, while declining coal inventories at power plants and strong thermal power demand provide additional support for earnings growth. Coal offtake jumped 12% year-on-year to 186.34 million tonnes, supporting the positive outlook despite cost pressures from explosives, fuel, and contractual expenses.
JM Financial maintained an ADD rating with revised target of ₹438, flagging that EBITDA per tonne came in at ₹399, missing estimates by 28% largely because of aggressive inventory liquidation. Motilal Oswal reiterated a BUY with revised target of ₹450, cutting FY27 EBITDA estimate by 5% to account for higher production costs but leaving FY28 estimates unchanged. Elara Securities was the most bullish, maintaining BUY with ₹522 target, calling the quarter broadly in line with estimates. All brokerages see support from improving coal demand and pricing, though their differing views reflect concerns around costs and the sustainability of earnings growth.
Despite the earnings miss, Morgan Stanley maintained its 'Overweight' rating on Coal India with a target price of ₹480 per share. As reported by NDTV Profit, the brokerage described the quarterly performance as disappointing but believes the company is entering an earnings upgrade cycle. Morgan Stanley highlighted that Coal India's fundamentals remain favourable, supported by thermal power demand growth of around 8% year-on-year over the trailing 12 months. Coal inventories at thermal power plants have declined to around six days, their lowest level in five years, with elevated global coal prices potentially driving higher e-auction premiums and realisations.
Jefferies maintained its 'Buy' rating on Coal India but reduced its target price to ₹460 from ₹500. According to NDTV Profit, the brokerage highlighted a 29% year-on-year increase in Q2 cash EBITDA and a 53% jump in profit after tax, supported by 12% growth in dispatch volumes. Jefferies expects a 7% earnings per share compound annual growth rate over FY26-FY29, with a dividend yield of around 7% supporting its positive investment outlook. The brokerage expects sustained demand recovery, supported by low power-plant coal stocks and rising international prices.
