Coal India Q3 Review – Good Volumes, Profit Growth; Rising prices are the need of the hour: ICICI Securities

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Coal India Ltd. recorded good figures for the third quarter of FY22 with a 20% year-on-year increase in revenue to 284 billion rupees, supported by a 10.8% year-on-year increase in levies to 174 million tonnes and a 6.3% year-on-year increase in average realizations to 1,497 rupees/tonne.

Ebitda at 68.2 billion rupees was 32.2% higher year-on-year, while EBITDA/tonne was 393 rupees.

This strong performance came despite strong cost pressures on multiple fronts, which offset increased volumes and realizations, and which we believe are a compelling reason for an impending price hike.

Considering increasing demand for domestic coal due to high thermal power plant load factors and high international coal prices resulting in high volumes and e-auction premiums, we believe Coal India will improve its growth in the fourth quarter of FY22.

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