Coal India Shares Fall Despite Marginal Q1 Profit Growth

Coal India Limited reported a consolidated net profit of approximately ₹8,852 crore for the first quarter of FY27, a marginal increase from ₹8,797 crore the previous year. Despite an 8% rise in revenue from operations to ₹46,255 crore, the company experienced an 18% sequential profit decline from the fourth quarter of FY26 and a narrowing EBITDA margin of 26.1%, down from 29.3%.

Rising operational costs pressured the bottom line, with expenses for mining essentials like industrial diesel and explosives increasing 27% year-on-year to ₹3,260 crore due to the West Asia conflict. Coal production fell to 169.63 million tonnes from 183.32 million tonnes in the prior year, though coal offtake rose to 197.86 million tonnes. The company declared an interim dividend of ₹5.50 per equity share.

Market reaction was negative, with shares falling between 2% and 3% on Tuesday. Brokerage responses were mixed: Jefferies maintained a Buy rating with a ₹500 target citing power demand recovery, while Nuvama maintained a Reduce rating. Other firms including Citi, JPMorgan, and Morgan Stanley pointed to weak operating performance and anticipated cost headwinds from upcoming wage revisions.