MOSL: COAL INDIA (Buy)-April 2017-Off-take growth remains strong-E-auction realization impacted
​Coal India: April 2017: Off-take growth remains strong; E-auction realization impacted by weaker mix in March 2017
(COAL IN, Mkt Cap USD26.4b, CMP INR275, TP INR335, 20% Upside, Buy)
Off-take grew by 6.7% YoY in April
- ​Off-take grew 6.7% YoY to 45.3mt in April, driven by demand growth and import substitution, mirroring the trends (+5-6% YoY) of the past few months. We estimate 6.8% YoY growth in off-take in FY18 (after sluggish +1.6% in FY17), led by end to the destocking cycle, acceleration in import substitution and demand growth.
- Off-take growth at CCL, SECL, NCL and WCL subsidiaries was in double-digits. BCCL reported an 11% YoY decline, continuing the trend of the last few months, due to an increase in coal prices. MCL reported a 7% YoY decline due to local issues in ramping up production.
- Coal production declined 4.1% YoY to 38.4mt in April, led by destocking of inventories at mines.
Coal India is engaged in the identification, exploration, and production of coal in India. Co. offers coking coal primarily for use in steel making and metallurgical industries, and for hard coke manufacturing; semi coking coal for use as blend-able coal in steel making, merchant coke manufacturing, and other metallurgical industries; NLW coking coal for use in power utilities and non-core sector consumers; non-coking coal for use as thermal grade coal for power generation, as well as for cement, fertilizer, glass, ceramic, paper, chemical and brick manufacturing, and for other heating applications.
Motilal Oswal Financial Services Ltd. is a reputed name in Financial Services and Online Trading with group companies providing services such as Private Wealth Management, Retail Broking and Distribution, Institutional Broking, Asset Management, Investment Banking, Private Equity, Commodity Broking, Currency Broking, Principal Strategies & Home Finance.
Motilal Oswal Securities is a group company of Motilal Oswal Financial Service Limited which started as a stock trading company and has blossomed into well diversified firm offering a range of financial products and services. Motilal Oswal has built a reputation as the source for best stock trading company and this has taken a wealth of experience, knowledge and expertise, constantly working in tandem, over the years.
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