Hold Coal India, says Sanjay Vaid

Hold Coal India, says Sanjay Vaid, Sr Vice President and Co-Head of Equities, SBI Cap.

Vaid told CNBC-TV18, "Coal India is a good pick. The revenues of the stock for first quarter have gone up by 27%, EBITDA margins almost 55% and PAT was up 63%, so clearly showing huge amount of traction not only on the revenue front but also on the PAT front. But there have been certain negative news in the environment for the last week, 10 days - one on the wages, the other on the stoppage especially in Jharkhand for the subsidiary - 22 mines have been shut. Till they get environment clearances, they will not be reopened."
He further added, "Given this environment I think the stock has corrected a little and gone down but in case you are a long term investor - the kind of growth which we are expecting especially going forward and the kind of availability of rakes which the company is saying because they need almost 187 rakes per day and they are saying that for the next year the Railways are telling them they might get almost 200 rakes per day then the off take obviously will increase and that would come down and improve the profitability of the company going forward. Given that scenario I think the investor should hold on to Coal India stock."