Key highlights from Coal India Ltd (COALINDIA) Q3 FY24 Earnings Concall
- Nine-Month Financial/Operational Performance
- Revenue from operations at INR 1,04,914 crores, up 5%.
- Highest ever net sales, up 4%.
- Highest ever PBT at INR 31,937 crores, up 5%.
- Highest ever PAT at INR 23,849 crores.
- Highest ever coal production at 531.90 million tonnes.
- Capex at INR 5,702 crores.
- On track to achieve target of INR 16,500 crores in FY 2023-24.
- Coal Production Target
- Likely to achieve 770-780 million tonnes in FY24.
- 5 subsidiaries ahead of targets, but SECL may have 8-9 million tonne shortfall.
- Targeting 10%+ growth for next year at 838 million tonnes.
- E-auction coal volumes were 13% of total in January 2023, increased to 17% by mid-February.
- Expect to hit 15% target for second half of FY24.
- Could reach 20% by March 2024 as production ramps up.
- Coal India aiming for 1 billion tonne production level.
- Demand expected to grow with 80,000 MW new power plants by 2030.
- CIL Financial Outlook
- Strong profit and dividend payouts to continue.
- Well placed to sustain momentum despite market uncertainties.
- Business Expansion Plans
- Well prepared through advanced procurement and capacity building.
- Investing in latest technologies for efficient, sustainable operations.
- Confident of mitigating risks and uncertainties.
- Participating in upcoming auction for 3 exploration blocks in India.
- Also exploring opportunities in Australia currently.
- Capex Targets
- INR 17,500 crores targeted for FY24 and FY25 that includes land acquisition, railway lines, and coal gasification projects.
- Coal mine expansion funded through internal accruals.
- Renewable energy and diversification may require some debt financing.
- Strike Impact
- Marginal impact from one-day strike by some unions.
- 80-95% production achieved during strike.
- Strike related to national-level issues, not primarily Coal India.
- Coal Price Outlook
- Expected to stabilize at current levels for next year or so.
- Dependent on future events like hosting of Olympics, etc.
- Internal estimates suggest stable trend in coal prices.
- Import Substitution
- Around 50 million tonnes of coking coal imports likely to continue.
- Some coastal power plants designed for imported coal may continue imports.
- Target of 175-200 million tonnes of imported coal substitutable with domestic supply.
- High-grade coal from Coal India mines offered to non-regulated sectors like cement.
- Washery Expansion
- Madhuband washery commissioned recently, capacity 5000 TPD.
- Two more washeries in BCCL under construction.
- Plans to increase washed coking coal production from 1.5 MT to 6-7 MT by FY27.
- 10 MT Lakhanpur non-coking coal washery commissioned.
- Target of 8 MT washed coking coal by FY30.
- Coal Price Revision
- No proposal currently to revise coal prices under Fuel Supply Agreements.
- Last revision was an 8% increase for G1 to G10 grades in 2018.
- Outlook
- Expected to increase to around INR 18,000-18,500 crores in FY26.
- Capex likely to rise sharply initially during project start, then stabilize.
- Optimistic about maintaining double-digit production and dispatch growth in FY24.
- Efforts to make up for any shortfall from other subsidiaries.