Coal India slips 3% post Q1; analysts retain bullish view, see 19% upside

Coal India reported a net profit of ₹8,849 crore for the first quarter on a year-on-year basis. Total income grew 8.4 per cent year-on-year to ₹48,295 crore.

Coal India Q1 results review: Coal India Ltd.'s share price came under pressure after it reported its Q1FY27 results post-market hours on Monday. The state-owned miner's profit remained flat, but analysts noted an in-line performance for the April–June quarter. 

 

At 9:45 AM, Coal India's share price was trading 2.87 per cent lower at ₹415 per share on NSE. In comparison, Nifty 50 was up 0.07 per cent at 24,013.60. In intraday trade, the stock declined 3.04 per cent to touch the day's low at ₹414 per share.

 

Coal India Q1 results highlights:

• Coal India Ltd's net profit remained largely flat at ₹8,849 crore in the first quarter of 2026-27 (Q1FY27), compared to a profit of ₹8,787 crore in the same quarter of the previous financial year.
• The company's total income, however, grew 8.4 per cent year-on-year (Y-o-Y) to ₹48,295 crore, compared with ₹44,535 crore in the year-ago quarter. 
• Total expenses rose 12 per cent to ₹36,816 crore during the quarter.
• Employee benefit expenses increased marginally by 0.4 per cent to ₹11,023 crore, while contractual expenses rose 11 per cent to ₹8,658 crore. 
• The cost of materials consumed, including explosives, lubricating oil and heavy earth-moving machinery, jumped 27 per cent to ₹3,260 crore during the quarter.

Brokerages’ view on Coal India post Q1 Results

Jefferies | Buy | Target ₹500

 

The global brokerage noted that Coal India's Ebitda was a miss, below Jefferies' estimates, led by higher-than-expected costs. It added that, cash Ebitda per tonne contracted mainly due to higher material consumption (explosives, oil & lubricant)

 

 

However, profit after tax was up 1 per cent y-o-y, inline with Jefferies' estimates. Power demand has started to recover, and a potential below-normal rainfall due to El-Niño event can boost power demand further as lower rainfall typically raises power demand for agriculture and residential use, the brokerage noted. 

 

"Higher global coal prices a positive, we expect Coal India's earnings trajectory to improve with 6 per cent earnings per share on compound annual growth rate over FY26-29E," Jefferies said.

 

Emkay | Add | Target ₹475

Emkay noted that Coal India reported an "in-line 1QFY27", with Ebitda at ₹143.5 billion,  broadly matched consensus estimates on like-for-like basis, "albeit 14.7 per cent above our estimate". 

 

The brokerage added that earnings remained resilient despite higher raw-material costs and other expenses offsetting revenue growth.

 

Operationally, production declined 7.5 per cent y-o-y to 169.6mt, though offtake grew 3.6 per cent yoy to 198mt, supported by strong dispatches. E-auction premiums remained healthy at 47 per cent despite accounting changes, Emkay said.

 

"Incorporating the 1QFY27 results, we continue to model a 6 per cent offtake volume compound annual growth rate over FY27-29E, broadly in sync with the projected 7 per cent growth in power demand, with incremental support from a likely reduction in Indonesia's coal production target. Accordingly, we maintain 'Add' and target price of ₹475," the brokerage said

 

Motilal Oswal Financial Services | Buy | Target ₹510

MOFSL noted that Coal India’s Q1FY27 revenue stood "largely in line, driven by higher volume offtake".

 

The brokerage, however, highlighted that Coal India’s earnings came under pressure due to cost pressures arising from the geopolitical situation. "We expect some of these cost headwinds to stabilise in the coming quarters. Going forward, we expect Coal India to post a 3-4 per cent volume compound annual growth rate in FY26-28, while a higher share of e-auction volumes and improved premiums should support overall NSR and margins". It added that this is expected to translate into an annual growth of 4 per cent and 9 per cent in revenue and Ebitda over FY26-28. 

 

MOFSL noted that the company’s focus on increasing coal-washer capacity will improve its market share in domestic coking/non-coking coal. Further, management continues to focus on expanding its coal mining operations, which will be funded through internal accruals. 

 

"We retain our estimates and reiterate our 'Buy' rating with a target price of ₹510," the brokerage said.

 

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