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Coal India, the world’s largest coal mining company, reported a 16% year-on-year decline in consolidated net profit to ₹7,165 crore for the December quarter, missing analyst estimates of ₹7,200 crore. The state-owned miner’s performance was hampered by weaker sales, higher operating costs, and poor price realizations.
Financial Performance Deteriorates
Revenue from operations fell 4.7% to ₹30,818 crore compared to ₹32,359 crore in the same quarter last year, though it showed a 14.5% sequential improvement from the September quarter. Operating expenses rose to ₹28,132 crore from ₹27,280 crore, primarily due to executive pay scale upgrades across the Coal India Group following a January 7, 2026 order by the High Court of Jabalpur.
EBITDA declined significantly to ₹10,285 crore from ₹13,753 crore in the year-ago quarter, with margins compressing 800 basis points to 29.44%. Despite the annual decline, the company showed sequential recovery with net profit improving 68% from ₹4,264 crore in the September quarter.
Production and Sales Metrics Decline
Coal India’s operational performance reflected broader challenges, with production dropping 1% to 200.05 million tonnes compared to 202.02 million tonnes in the previous year’s quarter. Coal offtake fell more sharply by 3% year-on-year to 188.66 million tonnes from 194.53 million tonnes.
For the nine-month period ending December, coal production declined 3% to 529 million tonnes, falling short of the company’s target of 605.38 million tonnes. Price realizations also weakened, with average e-auction sales at ₹2,434.56 per tonne compared to ₹2,684.79 per tonne previously, while overall average coal prices dropped ₹29 to ₹1,638 per tonne.
Subsidiary Performance Mixed
Among Coal India’s eight subsidiaries, four reported profit increases. Mahanadi Coalfields Limited emerged as a standout performer with a 23% year-on-year jump in net profit to ₹3,143 crore, demonstrating resilience despite the parent company’s overall challenges.
Shareholder Returns Continue
Despite the profit decline, the Maharatna company announced a third interim dividend of ₹5.50 per share for financial year 2025-26. The company set February 18 as the record date for dividend eligibility, with payments scheduled on or before March 13. This dividend declaration maintains the company’s commitment to returning cash to shareholders even amid operational headwinds.
Sources: South China Morning Post, Economic Times, Mint
