Why Axis Securities Is Bullish on Coal India’s Dividend Yield and Production Growth?
About Coal India and Brokerage Update
Axis Securities has maintained a Buy rating on Coal India with a target of ₹550, citing high dividend yield, steady volume growth, and margin stability. The PSU major continues to deliver consistent earnings and superior cash flows despite global coal volatility.
The report underscores that Coal India’s strong fundamentals, coupled with a predictable policy framework, make it one of the most reliable income plays within India’s PSU universe.
Coal India’s production and offtake remain robust as industrial demand for power continues to expand. The company’s logistical efficiency, particularly in rail evacuation and mechanized loading, has reduced turnaround time and lowered cost per tonne.
Financial & Operational Performance
| Metric | Q2 FY26 | YoY Change |
|---|---|---|
| Revenue | ₹36,790 Cr | +8.4% |
| EBITDA | ₹10,120 Cr | +6.8% |
| EBITDA Margin | 27.5% | Stable |
The margin stability shows Coal India’s strong pricing discipline and improved cost control. Investors seeking PSU yield exposure may align strategies with F&O Strategy and Nifty Futures Directional View.
The company continues to hold one of the strongest balance sheets in the PSU space with near-zero net debt and consistent free cash flow generation supporting regular dividends.
SWOT Analysis
Strengths
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Weaknesses
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Coal India’s operational scale is unmatched, but diversification into clean coal and renewables will be crucial for its next growth phase.
Opportunities
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Threats
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Despite policy overhangs, strong dividend support and demand resilience make Coal India a core defensive holding.
Investor Takeaway
Coal India’s ability to sustain production growth, improve logistics, and maintain high dividend yield cements its PSU leadership. The counter remains a safe, long-term compounding story aligned with India’s energy security objectives.
Explore more PSU and energy insights at Indian-Share-Tips.com, which is a SEBI Registered Advisory Services.
Related Queries on Coal India Outlook
- Will Coal India Maintain 8% Dividend Yield in FY26?
- Can Mechanization Boost Coal Logistics Margins?
- Is Coal India a Defensive Bet During Market Volatility?
SEBI Disclaimer: The information provided in this post is for informational purposes only and should not be construed as investment advice. Readers must perform their own due diligence and consult a registered investment advisor before making any investment decisions.
