Buy Coal India on declines: VK Sharma, HDFC Securities

VK Sharma, Head of Business, Private Broking & Wealth Management, HDFC Securities in a chat with ET Now gives his views on CIL stock.

ET Now: What are your thoughts on Coal India?

VK Sharma: Coal India is a good bet at this point of time. The Fuel Supply Agreement(FSA) has been signed. FSA has 1% penalty on CIL, if it does not live up to its agreement of supplying the desired quantity of coal to power producers. That penalty could be hefty if it is revised & is a cause of worry.

Going forward, if the penalty is revised, at the intervention of PMO, then Coal India will take a hit. But, right now unless that is revised, Coal India is a stock that can be bought at dips.