This Maharatna stock deals in the business of engaged in mining and production of Coal and they also operate Coal washeries is in focus after the company entered into an MoU with IREL (India) for collaboration & development of critical minerals.
Price Action
With a market capitalization of Rs. 2,33,721.47 Crores, the shares of Coal India Limited were up by 1.43 percent touching a day’s high of Rs. 384.20 per share. The stock reiterated from the day’s high and was trading at Rs. 379.25 per share which is 0.13 percent from the previous closing price of Rs. 378.75 apiece. The stock has delivered a negative return of 1 percent over the past year and underperformed the Nifty Index.
What Happened
The movement in stock price was due to the company entering into a Memorandum of Association (MoU) with Indian Rare Earths Limited (IREL), a public sector undertaking under the Department of Atomic Energy (DAE) on 06th January 2024 at IREL Headquarters in Mumbai based on cooperation and collaboration for the development of mining or extraction of refining of mutually agreed assets of critical mineral in general which includes mineral sands or REE by acquiring assets or sourcing raw material domestically or internationally.
About the Company
Coal India Limited (CIL) was established in 1975. It is a government-owned coal mining company and the largest producer of coal in India. Their business model focuses on the extraction and sale of various coal types which includes coking and non-coking coal, primarily serving sectors like steel, power, and cement. CIL operates numerous open-cast and underground mines across India through its eight subsidiaries. They generate revenue from coal sales, consultancy services, and mining operations while contributing significantly to India’s energy security and economic growth. CIL is headquartered in Kolkata and they play a crucial role in the country’s coal supply chain. As of Q2FY25, the company’s production of raw materials was 152.06 million tonnes and the offtake of raw coal was 167.71 million tonnes.
Financials & Ratios
Its Revenue from operations declined by 6.41 percent year on year from Rs. 32,776 Crores in Q2FY24 to Rs. 30,673 Crores in Q2FY25, accompanied by profits of Rs. 8,049 Crores to Rs. 6,275 Crores.
In the return ratios, the return on equity (RoE) in FY24 stood at around 52.06 percent, and the return on capital employed was around 30.47 percent. The debt-to-equity ratio stood around 0.08 as of FY24.
Shareholding Pattern
As of September 2024, the shareholding pattern with the promoter’s stake holding a share of 63.13 percent in Coal India, Foreign Institutional Investors (FII) holding around 9.16 percent, Domestic Institutional Investors (DII) holding around 22.57 percent, and the public holding around 5.13 percent.
Written by Santhosh S
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