Coal India will be announcing its Q4FY24 earnings on May 2. According to consensus estimates of 11 brokerages, the PSU firm's revenue for Q4FY24 is expected to increase by 8.7 percent to Rs 38,152 crore as against Rs 35,092 crore in Q4FY23. PAT, on the other hand, is expected to increase by 27 percent to Rs 7,617 crore from Rs 5,533 crore in Q4FY23 but is expected to decline on a QoQ basis. EBITDA for the reporting period is also expected to increase by around 45 percent YoY to Rs 10, 132 crore as against Rs 6,898 crore in Q4FY24, but decline on a QoQ basis by around 11 percent.
Axis Securities analysts expect the higher total sales off-take along with e-auction volumes to offset the drop from lower e-auction premiums, leading to higher revenue QoQ. Additionally, they expect adjusted EBITDA (excluding OBR) to increase by 26 percent YoY, driven by higher overall coal off-take. However, they expect adjusted EBITDA to decrease by 6.5 percent QoQ, due to slightly higher input costs in Q4FY24.
In the March 5 report, Nuvama analysts said that while the stock price had recently corrected amid fears of e-auction prices cooling off, they infer that a rise in e-auction volume compensated for the fall in e-auction prices and as a result, profit from e-auction volume remained firm in the last four months, which is positive.
ICICI Securities analysts expect the QoQ performance to be impacted by lower e-auction premiums. But added there is likely to be an upside to their estimates as performance incentive in Q4FY24 might be higher than their estimate of Rs 7,000 crore. "Expect manpower cost to remain stable," the brokerage added.
Additionally, they believe that e-auction prices have bottomed out at a 39 percent premium in February 2024. "Coal India is on course to meet our volume estimate of 752mt in FY2024 and can grow better-than-expected 5 percent YoY growth in FY2025E," the report added.
Emkay Global, which initiated coverage on the stock on March 26 with a buy call, stated that Coal India was embarking on a multi-year value-creation journey with volume growth, strong margins, and free cash generation. "We believe the company will succeed with sustained high returns on invested capital along with volume growth until the end of the decade and expect the stock to re-rate on a multi-year view," the report added.
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