State-controlled coal mining company Coal India will announce its second quarter (July-September) earnings today. According to a CNBC-TV18 poll, analysts expect profit after tax of the company to jump 12.4 percent year-on-year to Rs 3,459 crore and net sales to grow 9 percent Y-o-Y to Rs 15,819 crore during the quarter.
Topline will be driven by higher volumes as off take volume climbed 7.3 percent on a yearly basis (down 5.4 percent sequentially) to 109.1 million tonne.
Earnings before interest, tax, depreciation and amortisation (EBITDA) may rise 22 percent Y-o-Y to Rs 3,494 crore due to better realisations and volumes. However, higher employee and stores and spares cost will restrict gains at the EBITDA per tonne level, analysts said.
Operating profit margin may expand 250 basis points to 22.1 percent in three-month period ended September 2013 from 19.6 percent in a year ago period.
Key issues to watch out for are: 1) Volume, realisation trend and guidance for FY14/15; 2) E-auction and annual contracted quantity (ACQ) mix guidance for FY14/15; 3) Clarity on OFS/buyback and special dividend; and 4) Rake availability.
Analysts feel the company may miss its FY14 sales target of 492 million. Till now, it has done 54 percent of its total sales.
October was a big miss for the company, primarily due to heavy rains especially in Eastern India and cyclone Phailin. It reported production at 235.5 million tonne during April-October period of 2013 as against target of 247.5 million tonne while offtake stood at 259.9 million tonne during the same period as against target of 268.8 million tonne.
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