Coal India Shares Face 13% Downside Risk, Nuvama Warns

• Nuvama maintains 'reduce' rating on Coal India with a price target of ₹384, implying a 13% downside.
• Brokerage cites excess domestic supply, rising competition, and subdued demand impacting volumes and e-auction prices.
• Nuvama projects e-auction premium to remain range-bound (35-40%) and muted earnings growth with EBITDA at 4% CAGR (FY26-28).
• Wage hike pressures for non-executives from July 2026 could further impact profitability.
• Coal India shares are trading 3.2% lower, making them the worst performers on the Nifty 50 index today.

Key Questions Answered

Why does Nuvama predict a 13% downside for Coal India shares?

Nuvama predicts a 13% downside for Coal India shares due to excess domestic supply, rising competition, and subdued demand.

What factors could impact Coal India's e-auction volumes and prices?

Factors impacting Coal India's e-auction volumes and prices include domestic demand, supply levels, logistics, competition, and global coal prices.

How might wage hikes affect Coal India's earnings growth by 2028?

Wage hikes are expected to keep Coal India's earnings growth muted. The company's EBITDA is projected to grow at only a 4% CAGR from FY26-28. A wage revision for non-executives is due from July 2026.