Shares in Coal India fell more than 25 to a record low on Monday after posting its first quarterly profit decline in five quarters, saying lower sales realisations and higher wage and diesel costs were to blame.
The state-owned miner said on Saturday net profit for its fiscal first quarter fell to Rs. 3731 crore. Analysts, on average, had forecast net profit of Rs. 4240 crore, Coal India shares were down 2.4%,after earlier hitting a record low at Rs. 248.25 its lowest price since listing on November 2010, on the Bombay Stock Exchange (BSE). The stock of the world’s largest coal miner has underperformed the market by falling 6.25% in past one week after the company missed its production and off take targets both for June and the first quarter of the current fiscal.The company said it produced 32.5 MT of coal in June, missing the month’s target of 35 MT.The board of Coal India Ltd. (CIL), approved a revision in coal prices which involved reduction in prices of certain grades and increase in others.According to Mr. Narsing Rao,the chairman of CIL,Coal India wouldn’t be entering any more changes to its re-drafted Fuel Supply Agreements.He said the company has also asked the government to expedite the law for land acquisition and rehabilitation so that acquiring land for projects could be easier and clear.For the fourth quarter, CIL reported a consolidated net profit of Rs.5,413.9 crore. Consolidated net sales also went up from Rs.19,904 crore to Rs.19,418 crore in the year-ago period.Lets see whether this will give a positive imapact on the share price of the company or not..
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