CGS International analysts Jacquelin Hamdani and Edward Halim say Indonesian coal miners are likely to face headwinds from softening coal prices and weak demand, as high stockpiles and China’s increasing use of renewables erode pricing power.

They revised net profit forecasts downward by 4%-13% for United Tractors, Indo Tambangraya Megah, and Bukit Asam, citing weaker prices and higher costs. Historically high dividend yields are also expected to decline.

As a result, CGSI downgrades the sector rating to underweight from neutral, reflecting a cautious outlook over the next 6–12 months.