Why Coal India shares fell 2% despite strong Q2 revenue growth
Brokerage reactions were mixed; JM Financial maintained an ADD rating on the stock
Coal India shares experienced a 2% decline on Friday despite a robust second quarter revenue growth. The stock opened at ₹398 and peaked at ₹398.05 but swiftly declined to ₹380.40 as investors grappled with a decrease in operating profit. By mid-morning, over 1.06 crore shares had been traded with a majority of buy orders - 58%.
The stock's current trading price is below its 52-week high of ₹491.25 reached in April, having dropped by nearly 9.5% in the past month. Analyst responses were divided. JM Financial kept an ADD rating with a reduced target of ₹438 from ₹458, citing that EBITDA per tonne was ₹399, missing estimates by 28%, primarily due to aggressive inventory liquidation.
Motilal Oswal maintained a BUY rating with a revised target of ₹450, adjusting the FY27 EBITDA estimate downward by 5% to consider increased costs for explosives, fuel, and contractual expenses, but kept FY28 estimates as is. Elara Securities was the most optimistic, retaining a BUY rating with a target of ₹522, acknowledging the quarter was in line with estimates while noting that coal offtake surged 12% year-on-year to 186.34 million tonnes.
Coal India's Q2FY27 revenue was ₹44,170 crore, a 21% increase year-on-year. Adjusted EBITDA rose by 28% year-on-year to ₹7,400 crore, but dipped significantly quarter-on-quarter. PAT was ₹6,500 crore, a 52% increase year-on-year. The board also approved a second interim dividend of ₹10.25 per share for the TY 2026-27 fiscal year, bringing total dividends in the first half to ₹15.75 per share.
Written by urgent.news from Hindu BusinessLine's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
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