Coal India - One-Off Quarter; Improved Outlook On E-auction Realisations Drives Upgrade: Prabhudas Lilladher

A front loader moves coal in Jharkhand, India. (Photographer: Prashanth Vishwanathan/Bloomberg)

Coal India - One-Off Quarter; Improved Outlook On E-auction Realisations Drives Upgrade: Prabhudas Lilladher

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Prabhudas Lilladher Report

Coal India Ltd. reported Q1 FY22 earnings below our estimates.

Adjusted Ebitda grew 64% YoY to Rs 46.6 billion against our estimate of Rs 72.3 billion.

The miss was largely due to one-time provision of Rs 6 billion in employee cost and low operating leverage.

Our optimism on Coal India is based on:

  1. sharp rise in E-auctions realisations (up ~20% over Q1 average in June and July) expected in coming months,

  2. higher operating leverage due to bottomed-out inventory levels and

  3. improving balance sheet with reduction in receivables.

Admittedly, stock has been trading at attractive valuations for a long time, in line with global peers.

Click on the attachment to read the full report:

Prabhudas Lilladher Coal India Q1FY22 Result Update.pdf

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