Analyst Research Report Snapshot

Title:

Coal India (COAL) - Flash Note - Dated - December 03, 2013

Price:

$23.00

Provider:

Axis Capital Limited

Date:

04 Dec 2013

Pages:

3

Type:

AcrobatPDF

Companies referenced:

COAL.NS

Available for Immediate Download
Summary:

 Coal India’s dispatch volumes in October and November were impacted by cyclone (in October) and disruptions at Mahanadi Coal fields (since end-November). Hence we reduce our FY14 volume growth assumption to 3% (vs. 4% earlier), implying full year volumes of 479 mnt. We also cut our FY15 volume to 501 mnt (vs. 506 mnt earlier; 4.5% growth YoY)  We reduce our EPS estimates for FY14 to Rs 27 (Rs 29 earlier) and for FY15 to Rs 30 (Rs 32 earlier). We have a BUY rating on the stock with DCF-based target price of Rs 300 (Rs 317 earlier), an upside of 11% from CMP of Rs 270. However, the planned offer for sale (OFS) will remain an overhang on the stock Highlights  November dispatch volume declined 1% YoY to 39 mnt, mainly led by disruptions at Mahanadi coalfields since last week of November. A new contractor had taken over coal loading and other activities and was using his own workers, leading to protests by those hired by the previous contractor and disruptions in production and dispatch  Subdued November follows 8% YoY decline in volumes in October due to cyclone and flooding in key coal producing states viz. Odisha, Jharkhand and West Bengal. Led by subdued October and November, Apr-Nov dispatches grew at a subdued 2% YoY to 299 mnt (vs. 5% YoY growth in Apr-Sep period)  Though we expect operations at Mahanadi Coalfields to return to normal levels soon, subdued volumes in Q3 will impact volumes for full year FY14 Regards, Jagdishwar Toppo (Executive Director – Materials) Institutional Equity Research Axis Capital Ltd Tel: +91 22 4325 1103 Nitesh Jain (Sr VP – Materials) Institutional Equity Research Axis Capital Ltd Tel: +91 22 4325 1145 Sujan Sanisetty (Asst VP – Materials) Institutional Equity Research Axis Capital Ltd Tel: +91 22 4325 1122

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