Strong volume growth, lower costs positive for Coal India's outlook

While operating profit margins are likely to normalise over the next two fiscals, the net profit estimates are being upgraded by analysts on the basis of higher OBR reversals

Coal India’s (CIL’s) revenue for the first quarter of 2024-25 (Q1FY25) came in at Rs 36,500 crore, up 1 per cent year-on-year (Y-o-Y) and down 3 per cent sequentially, which was in line with consensus.

The blended average selling price was Rs 1,687/tonne, down 5 per cent Y-o-Y and down 1 per cent Q-o-Q, which was below estimates.

The adjusted operating profit (excluding overburden removal or OBR costs) stood at Rs 11,500 crore up 3 per cent Y-o-Y and up 17 per cent Q-o-Q, which beat the street. This was due to lower operating expenses.

The adjusted