Target: ₹530

CMP: ₹455.90

Q4-FY24 revenue stood at ₹37,400 crore (-2 per cent y-o-y/+4 per cent q-o-q), in line with our estimates of ₹37,600 crore. Blended ASP was ₹1,699/t (-9 per cent y-o-y/-2 per cent q-o-q), largely in line with our estimate.

APAT stood at ₹8,700 crore (+26 per cent y-o-y/-14 per cent q-o-q) vs. our est. of ₹6,800 crore. The beat was due to a change in OBR accounting. The company in Feb’24 approved the change in accounting policy on stripping activity, which the group was consistently following in the case of opencast mining with a rated capacity of 1 mtpa or more. In Q4, the company provided for the impact of this change and restated previous financials.

Coal India has declared a final dividend of ₹5 a share, taking the total dividend for FY24 to ₹25.5 a share.

To meet the increasing coal requirements of the power sector, it has made a long-term commitment via FSA agreements and BLCs. It targets to achieve a production of 838 mt in FY25, with dispatches under e-auction at about 15 per cent of total volumes.

With a robust volume outlook, healthy e-auction premiums, and lower costs, the outlook for Coal India remains positive. We maintain our revenue/EBITDA estimates for FY25/FY26. The stock is trading at 4.4x FY26E EV/EBTIDA. We reiterate our Buy rating with a revised TP of ₹530.