The brokerage expects Coal India’s earnings trajectory to improve over the next few years, forecasting a 9% earnings CAGR during FY26-FY28, supported by higher e-auction premiums, rising dispatch volumes and a recovery in power demand.
It has also raised its earnings estimates for FY26-FY28 by 1% to 4%, largely factoring in stronger e-auction realisations. The brokerage expects dispatch volumes to grow at a compound annual growth rate of about 5% over FY26-FY28, with total dispatches projected to increase from around 735 million tonnes in FY26 to about 810 million tonnes by FY28.
According to the report, Coal India could benefit from a rebound in electricity consumption, particularly amid expectations of intense summer conditions and weaker monsoon patterns, which may lead to higher power demand.
The brokerage also highlighted the positive impact of rising international coal prices on domestic e-auction premiums.
The report noted that Coal India continues to maintain a dominant position in the domestic coal market. The company accounts for about 60% of India’s total coal demand and nearly 75% of domestic coal production.
The brokerage said Coal India remains an attractive investment due to its strong balance sheet, net cash position and high dividend payouts.
State-run Coal India is mainly engaged in mining and production of coal and also operates coal washeries. The major consumers of the company are the power and steel sectors. Consumers from other sectors include cement, fertilizers, and brick kilns.
On a consolidated basis, Coal India (CIL)'s net profit declined 15.85% to Rs 7157.45 crore while net sales declined 4.76% to Rs 30818.17 crore in Q3 December 2025 over Q3 December 2024.