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Coal India Q2 net seen up 23%, e-auction sales volumes key

Revenue is likely to increase 9.9 percent to Rs 17,230 crore during the quarter compared to Rs 15,678 crore in year-ago period, led by strong volume growth.

Coal India ‘s July-September quarter profit is seen rising 22.7 percent year-on-year to Rs 2,690 crore on strong operational income and lower tax cost, according to average of estimates of analysts polled by CNBC-TV18.

Revenue is likely to increase 9.9 percent to Rs 17,230 crore during the quarter compared to Rs 15,678 crore in year-ago period, led by strong volume growth.

Offtake of coal increased 10.3 percent year-on-year to 121.9 million tonne and production was up 5.7 percent to 108.2 million in quarter ended September 2015.

Blended realisations could be lower due to higher sales to power sector.

Operating profit may surge 39.7 percent year-on-year to Rs 2,890 crore in September quarter and margin may expand 360 basis points to 16.8 percent during the quarter, led by higher sales volumes and e-auction volumes.

Key factor to watch out for would be e-auction of coal. Analysts feel e-auction realisations may hit owing to weaker international coal prices and premiums over FSA (fuel supply agreement) prices are under pressure on account of low end-user demand.

E-auction volumes are expected between 12.5 million tonnes to 16 million tonnes in Q2FY16. It was at 10 million tonnes in Q2FY15 (9 percent of total sales volumes).

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