Coal India Q2 net profit up 19% at Rs 30.8 billion, narrowly misses estimates

MUMBAI: Coal India's net profit in the latest quarter grew by 18% to Rs 3078 crore and its total income grew by 12% to Rs 166654 crore in the latest September quarter. Despite tough conditions, the company has been able to give such strong growth.

Then company's stock has remained around Rs 350 crore, due to disappointing results in the last two quarters. However, the worst seems to be behind for Coal India. Considering the company's last five-year performance and monopoly in the domestic coal business, the company is a good value pick. The company is trading at a price to book value of 5 as against peak price to book value of 8.

Coal Indiais world's largest coalproducer with reserves of more 250 billion tonnes. The company's sale has doubled in the last five years and its net profit has become more than two and half times. Despite providing coalto the Indianutilities at a significantly lower price as compared to imported coal, the company still enjoys an operating margin of 25%.