Buy Coal India, target Rs 380: Citigroup
If CIL uses Rs 78 billion in cash, buyback could increase to 6.4 per cent of outstanding shares, said the Citigroup report. The global investment bank believes that CIL would announce buyback for 5 per cent of shares at premium to CMP.
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| Updated: Citigroup maintains a buy on Coal India with a 12-month target price of Rs 380. At current market price, CIL can buy back 2.5 per cent based on amount to be received from subsidiaries.
If CIL uses Rs 78 billion in cash, buyback could increase to 6.4 per cent of outstanding shares, said the Citigroup report. The global investment bank believes that CIL would announce buyback for 5 per cent of shares at premium to CMP.
The brokerage firm also sees higher volume with UDAY, forward e-auctions, and rationalization of high-grade prices. "Price hike, ongoing linkage auctions alleviate concerns on EBITDA due to wage revisions," said the report.
If CIL uses Rs 78 billion in cash, buyback could increase to 6.4 per cent of outstanding shares, said the Citigroup report. The global investment bank believes that CIL would announce buyback for 5 per cent of shares at premium to CMP.
The brokerage firm also sees higher volume with UDAY, forward e-auctions, and rationalization of high-grade prices. "Price hike, ongoing linkage auctions alleviate concerns on EBITDA due to wage revisions," said the report.
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