February 16, 2017 / 11:25 IST
Coal India's (CIL) Q3FY17 EBITDA, at INR 38.5bn, was marginally below consensus due to INR 7.1bn wage cost provision, though revenue came in line. However, volume grew 4% YoY (23% QoQ) to 143mt with e-auction proportion rising to the highest-ever level of 17.7% (up 66% YoY) to 25.5mt.
Outlook
With volume uptick (6% YoY growth) apparent in recent months, we believe benefit of operating leverage will result in EPS growth of 26% YoY until FY19E due to better absorption of higher employee cost post wage negotiation. Rolling over to FY19E, we maintain ‘BUY’ at revised target price of INR 360 (INR 350 earlier).
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