Case Study: Coal India, Dividend Yield Investing in a PSU

Coal India has spent most of its listed life as the stock income investors love to screen for: a dominant market share, a strong balance sheet and a dividend yield that routinely beat a bank fixed deposit. It has also spent long stretches going nowhere, as a government owner, wage revisions, offer-for-sale overhangs and the energy transition weighed on the price. This case study takes the business apart: how Coal India earns money from fuel supply agreements and e-auctions, how to test whether a dividend is sustainable using payout ratio, free cash flow and cash on the books, and how the majority shareholder's priorities shape everything from capex to payouts. Then it follows the actual returns across two very different periods and asks what a high yield on a business with a contested long-term future is really worth. Built for investors who hold, or are tempted by, high-yield PSU stocks and want a framework grounded in real numbers from annual reports and screener.in.