Coal India: Higher volume offtake may offset lower e-auction realisations

Rise in output key for re-rating of Coal India stock

Coal India’s (CIL’s) modest 2.6 per cent year-on-year (YoY) growth in dispatches in April was a rather sedate start to FY20. 

While April’s performance comes on a relatively high base, on which volumes rose 12.6 per cent a year ago, the Street will closely watch the increase in output over the coming months. 

Better volumes will not only help meet commitment under the fuel supply agreement, but also drive up revenues of the profitable e-auction segment. Although e-auction prices remain higher on a YoY basis, they have just begun to cool off from the peak. 

An increase in the number of days of