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Informist, Thursday, Jul. 31, 2025

 

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--Coal India Apr-Jun consol net profit INR 87.43 bln
--Analysts saw Coal India Apr-Jun consol net profit at INR 85.55 bln
--Coal India Apr-Jun consol PAT INR 87.43 bln vs INR 109.59 bln year ago
--Coal India Apr-Jun consol revenue INR 358.42 bln vs INR 375.04 bln year ago
--Coal India to pay INR 5.50 per share interim dividend
--Coal India interim dividend record date is Aug 6
--Coal India Apr-Jun consol EBITDA INR 131.65 bln vs INR 154.78 bln year ago
--Coal India Apr-Jun sales volume in e-auction 21.31 mln tn vs 23.18 mln tn
--Coal India Q1 sales avg realisation per tn INR 1,673 vs INR 1,671 yr ago
 

 

By Avishek Rakshit

 

KOLKATA - Coal India Ltd. reported an on-year drop of over 20% in its consolidated net profit for the June quarter to INR 87.4 billion, because of a 4% year-on-year decline in sales volumes and moderating realisations from e-auctions. The Maharatna company's net profit beat analysts' expectation of a profit after tax of INR 85.6 billion.

 

The drop in its Apr-Jun total sales volumes to 191 million tonnes dragged the company's consolidated revenue down by 4.4% to INR 358.4 billion. Falling income from e-auctions added to the woes. However, Coal India's revenue was ahead of Street's expectation of INR 349.4 billion.

 

Despite a 3?cline in quarterly production to 183.3 million tonnes, Coal India was not able to cut its costs, impacting profit. The company's total expenses rose 2.2% on year to INR 258.9 billion and offset the gains that Coal India had made from a decline in its tax expense and the profit contribution from its joint ventures.

 

Since the end of the summer season last financial year, Coal India has been facing muted demand on account of surplus coal in the country. Companies owning captive coal mines such as NTPC Ltd., Tata Steel Ltd., and others have been stepping up their own production leading to lower dependence on Coal India. At the same time, due to poor demand from cement, steel and power sectors, the company liberalised its sales policy to increase sales volume. It also focussed on improvement in grades of coal to increase net sales realisation per tonne from these sectors.

 

Although Coal India's sales realisation per tonne from long-term supply contracts, or fuel supply agreements, improved by 1.7% on year to INR 1,549.6 a tonne, total sales volume under such contracts declined by 3.9% on year to 165.37 million tonnes. Fuel supply agreements are the key top line driver of Coal India. They accounted for 87% of the company's total sales volumes in the June quarter.

 

The world's largest coal miner's sales from e-auctions, which contribute substantially towards its profit, also took a hit. Sales volumes of coal sold under the hammer dipped by 8.1% on year to 21.3 million tonnes and prices fell by 3.3% on year to INR 2,331.5 per tonne.

 

Although the company was able to sell more washed coal - priced at a premium - its sales realisations per tonne declined, hence reducing the company's revenue by INR 2.6 billion. Overall, Coal India's average sales realisation per tonne went up by INR 2 on year to INR 1,673.

 

As a result of declining sales and profits and an increase in costs, Coal India's consolidated earnings before interest, tax, depreciation, and amortisation declined nearly 15% on year to INR 131.7 billion.

 

The net profit from its most profitable subsidiary, Northern Coalfields Ltd., remained flat at a little over INR 27 billion. Profit from its largest subsidiary Mahanadi Coalfields Ltd. fell 27% on year to INR 24.5 billion. The second-largest subsidiary, South East Coalfields Ltd, however, reported a 5% on-year increase in net profit at over INR 14 billion.

 

The net profit of Bharat Coking Coal Ltd., which has filed a draft red herring prospectus for listing on the country's bourses, reported a sharp 65?ll in net profit for the June quarter at INR 1.8 billion. Its mining services subsidiary, Central Mine Planning and Design Institute Ltd., which is also headed towards a public listing, reported a sharp 21% on-year drop in net profit to INR 760 million.

 

Due to lower production in the reporting quarter, Coal India was able to partially clear its opening stock of pithead coal inventory to 98.9 million tonnes as on Jun. 30, from 107.2 million tonnes during the start of 2025-26 (Apr-Mar). However, the pithead stock is still higher by 24% compared with the closing coal stock as on Jun. 30, 2024. Increased pithead stock limits the company's ability to scale up production.

 

Faced with muted demand, which is projected to continue in the long-term as India transitions towards clean energy, Coal India is increasingly relying on its diversification projects. It signed an initial agreement with Hindustan Copper Ltd. to collaborate in copper and critical minerals sectors. The finer details of this agreement are yet to be finalised. Coal India also became the preferred bidder for the Oranga Revatipur Graphite and Vanadium Block of Chhattisgarh auctioned for mining lease. The company is also focussing on increasing its solar and thermal energy projects.

 

Coal India declared an interim dividend of INR 5.50 per share for 2025-26 (Apr-Mar), with the record date set at Aug. 6. On Thursday, shares of the company closed at INR 376.35 on the National Stock Exchange, down 1% from the previous close.  End

 

Edited by Nishant Maher

 

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