State-run Coal India Ltd., the world’s biggest miner of the fuel by volume, posted a 4.3 percent decline in fourth quarter profit as costs climbed.
Profit for the three months ended March 31 fell to 42.4 billion rupees ($664 million), or 6.71 rupees a share, from 44.3 billion rupees, or 7.02 rupees, a year earlier the company said Thursday. The median of 24 analyst estimates compiled by Bloomberg had been for a profit of 46.6 billion rupees. Total costs rose 3.9 percent to 160.7 billion rupees.
Sales increased to 207.7 billion rupees from 199.9 billion a year earlier, driven by a rise in volumes. The Kolkata-based company sold 134.7 million tons of coal during the three months, compared with 129.94 million tons a year ago.
“They may want to sell more coal this quarter in auctions, but there may not be enough demand given high levels of fuel inventory at power producers,” said Piyush Jain, an analyst in Mumbai for Morningstar Investment Services. “Unless they go for major price increases, their margins will be dented.”
Coal India’s production during in the three months to March 31 rose 6 percent to 151.9 million tons.
Shares of Coal India rose 0.1 percent 383.35 rupees in Mumbai Thursday. The stock is little changed this year, mirroring the benchmark S&P BSE Sensex.
Coal India, which produces more than 80 percent of India’s coal, plans to double production to 1 billion tons in five years.