Coal India (COAL IN) – Q2FY27 Result Update – Strong volume growth drives earnings – ACCUMULATE
Published on 30 Oct 2026
Coal India reported EBITDA (ex-OBR) of INR 73.9bn, up 29% YoY and 6% above our estimates. Ex-OBR EBITDA margin improved 100bps YoY to 16.7%, with EBITDA/tonne at INR 399, supported by higher volumes and improved FSA realizations. Offtake grew 12.9% YoY, driven by 11.9% growth in FSA volumes and a sharp 50.6% increase in e-auction volumes. E-auction volumes contributed 12% of total offtake vs 9% YoY. Excluding levies, segment-wise realizations were mixed. FSA realization improved 3.8% YoY to INR 1,510/tonne, while e-auction realization remained broadly flat YoY at INR 2,283/tonne, albeit declining 1.5% QoQ. Realization from washed coal and other categories surged 94.7% YoY to INR 3,614/tonne, though on a lower volume base. The company declared its second interim dividend of INR 10.25/share, taking the total H1FY27 dividend to INR 15.8/share, implying a payout ratio of 63%. We estimate FY27 DPS at INR 30.6. COAL currently trades at 4x Sept'28E EV/EBITDA. While EBITDA growth was modest at 4% in H1FY27, we expect it to accelerate to 17% in H2FY27. We retain ACCUMULATE with a target price of INR 465, valuing the stock at 5x 1HFY29E EV/EBITDA (vs. its 10-year average of 5.5x).
