Coal India drops as coal mining opened

Coal India was down 1.43% to Rs 305.80 at 10:46 IST on BSE after the Cabinet Committee on Economic Affairs, yesterday, 20 February 2018 approved opening up of commercial coal mining for private sector.

Meanwhile, the S&P BSE Sensex was up 44.76 points or 0.13% at 33,748.35.

On the BSE, 90,000 shares were traded on the counter so far as against average daily volumes of 3.42 lakh shares in the past one quarter. The stock had hit a high of Rs 312 and a low of Rs 305 so far during the day. The stock had hit a 52-week high of Rs 332.10 on 27 February 2017 and a record low of Rs 234 on 11 August 2017.

The stock had outperformed the market over the past one month till 20 February 2018, gaining 9.07% compared with the Sensex's 5.09% fall. The stock had also outperformed the market over the past one quarter, advancing 11.5% as against the Sensex's 1.03% rise. The scrip had, however, underperformed the market over the past one year, sliding 3.06% as against the Sensex's 17.59% rise.

The large-cap company has equity capital of Rs 6207.41 crore. Face value per share is Rs 10.

The Cabinet Committee on Economic Affairs (CCEA), chaired by Prime Minister Narendra Modi yesterday, 20 February 2018, approved the methodology for auction of coal mines/blocks for sale of coal under the Coal Mines (Special Provisions) Act, 2015 and the Mines and Minerals (Development and Regulation) Act, 1957. The opening up of commercial coal mining for private sector is the most ambitious coal sector reform since the nationalisation of this sector in 1973.

This reform is expected to bring efficiency into the coal sector by moving from an era of monopoly to competition.

On a consolidated basis, Coal India's net profit rose 4.2% to Rs 3004.79 crore on 5.3% growth in net sales to Rs 20708.47 crore in Q3 December 2017 over Q3 December 2016.

Coal India is an organized state owned coal mining corporate and is the single largest coal producer in the world. The government of India held 78.55% stake in the company end December 2017.

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