Coal India | Some negative factors not discussed yet

deneb

Well-Known Member
#11
Coal accounts for 30% of all energy in the world behind oil a 35% and the dependence of coal is increasing at a faster rate than oil, mainly because of the growing economies of China and India. In India, Coal accounts for 51% of our energy while Oil is at 30%. And of this 80% of coal comes from coal India.Can you think of any other company in any other field which can come close to the importance of Coal India.I cant.

One negative which hasnt been talked about is the FPO. Which the Govt will surely consider when it has to raise money, considering the fact that Govt. still holds 90% and the huge intrest shown at the time of listing. But when the FPO hits will be the only question, if one is holding it as an investment for many years.

PS: I hold the stock for investment.
 

swati23

Well-Known Member
#14
Be cautious with CIL for swing trading. My analysis- It will come down near or below Rs. 100 in 1 year. Then, will be the right time to invest for long term.
Maybe someone who has a better eye vision than me should point me to where did he mention "in case of scam" or will hit a new low? I request you to be more clear in the future instead of clarifying on being proven wrong. There are people who have investments and don't know much about the stock markets (Even me). Your comments are similar to those on TV channels(Their views: We think there will be more scams, RBI will hike rates so don't buy banking stocks, margins will be affected, etc.) which does nothing but scare people who don't have much knowledge of the stock markets. As I mentioned in my previous post, all companies can fall down in case of crash or such scams in their sector. I'm not trying to defend Coal India....even if you had made the same comment on Infosys saying it will reach RS 1000 I would have defended Infosys as well.

Here is a quote from SG. Its not exactly related to Coal India
If you hear drumbeat of 5300 emanating from the channels.... then there is a good chance that you may not see the level....and while you wait endlessly for that level... to start shopping... you probably will need to wait until next correction...which may happen in April or May 2011.
While you are waiting for your 230 levels it might happen that you just miss the bus as well as make others miss the bus as well with your comments.
 
#15
I started this thread as I've never seen anyone discussing the negative aspects of Coal India. Not on TV, not in newspapers, and not on the forum etc.. So much of positive hype around 1 stock is good to keep it alive. However, investors should also consider the negative factors before taking the plunge. I'm just urging to be rational by equating the positive factors with the negatives, instead of just following the positive news on the stock.

As I said earlier, I don't care if I miss the bus.. It has dozens of scrips which may prove better than Coal India. Market is very humble; I won't buy a scrip which is trading at higher than its IPO price band (for investment).
 

swati23

Well-Known Member
#16
That is not a problem. Most of us over here are not experts to not pay attention to calls given on this forum. It is fine if you don't want to buy it but by saying FIIS will start dumping it, coal scam, Fire and don't what else...you are just scaring away users who want to invest but are not that knowledgeable to make their own decisions. Please don't give out levels like Rs 100 or for that matter 230 if you don't have facts to backup your claims.
 
#18
I remember when my friends bought Reliance Power. Although I was not investing in it, but I told them that every major IPO comes when the market is at a high. So that the organization can churn out more money from the investors. One should look to book profit as quickly as possible after the listing, and try to buy it from the secondary market at lower levels. Market will always give you the chance to buy it. Another example: BHEL was trading near 3000 levels in 2007. People were telling that it can go up to 5000 levels. However, within one year, the stock price came down to 1000 levels. Hence, giving the chance to buy it for long term investors again.
BTW, BHEL is also a PSU. :)
 

swati23

Well-Known Member
#19
My Dear,

Get your facts right before giving historical data just to show that Coal India's price will fall.

BHEL's High in 2007 was 2857.45 - May 29 (NSE DATA)
June 1 - Bonus 1:1
Stock Price Reduced to 1400
November 7 2007 - 2865.00
So, people were right it did reach the target of Rs 5000. Had it not been for the bonus, the price of the stock would have been 2865.00 * 2 = Rs 5670
Those who were waiting for Rs 1000 levels failed to catch a 100% gain.

Regarding your IPO comment, give me some time I'll have to look up the data of the past issues.
 
Last edited:
#20
Still the Bhel's stock price fell from 1400 to 900 something levels. How many would have held on to that loss? Generally people start selling the stock if it falls at that rapid pace, unless one has kept their thoughts away for 10-15 years.
 

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