Volume issues to falling global prices, many concerns for Coal India stock

Muted volumes, declining coal prices and e-auction realisations, competition from private miners and stake sale overhang to weaken sentiment

The Coal India Ltd (CIL) stock, underperforming leading indices, is down by over 24 per cent since its June highs. Concerns over volume growth, declining international coal prices, lower e-auction realisations and coal block auctions for merchant mining (private sector) have hit investor sentiment and are responsible for the stock’s weak performance.

Even a strong boost from the recent reduction in corporation tax rate has failed to provide an impetus to the stock, as the company’s revised profit estimates still do not show significant earnings growth for the FY19-21 period. The Street also fears that in order to compensate for