Anand Rathi's research report on Coal India
The largest pure-play coal producer globally, Coal India offers healthy volume assurance, catering to mounting coal demand from the power sector. Its focus on increasing FSA and e-auction volumes would be catalysts for a strong performance. The company has taken many costsaving measures, along with evacuation and infrastructure-improvement projects, expected to drive greater productivity.
Outlook
Hence, with its focus on volume ramp-up and cost savings, we factor in 8.5%/13% sales volume/EBITDA CAGRs over FY24-26. The company has a prudent dividend policy and ahead a ~50% payout is expected. We, thus, initiate coverage on it with a Buy and a Rs.520 TP, 5.5x FY26e EV/ EBITDA.
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