Coal India Ltd (CIL), the producer of over 80% of India's coal, reported a year-on-year rise of 12.6% in coal production to 51.4 million tonnes (MT) in September 2023. The company supplied 294.8 MT to the power sector, surpassing the projected demand by 1.8 MT, amid record electricity demand.
From April to September, CIL's total supplies climbed to 360.7 MT, marking a 40% growth in the non-power sector. The company is aiming to meet a future supply target of 610 MT, which would surpass its previous record of 586.6 MT set in the fiscal year 2023.
In line with InvestingPro Data, CIL's market cap stands at Rs 1.79 trillion, with a P/E ratio of 6.79 and adjusted P/E ratio for LTM2023.Q2 at 6.49. The company has shown promising revenue growth of 52.95% for LTM2023.Q2, although it has experienced a quarterly decline of 20.45%.
Moreover, according to InvestingPro Tips, CIL yields a high return on invested capital and has been consistently increasing its earnings per share. The company also holds more cash than debt on its balance sheet, which is a strong indicator of financial stability. These factors, along with its impressive gross profit margins and the fact that it's a prominent player in the Oil, Gas & Consumable Fuels industry, make it an interesting investment consideration.
Despite these developments, Citi has maintained a neutral stance on Coal India's share price on the National Stock Exchange (NSE), with a target price of Rs 260. As of September, the coal stock at CIL's pitheads was recorded at 41.6 MT.
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