The board of Coal India Limited (CIL) has taken a significant step towards unlocking value in its subsidiaries, granting in-principle approval for the public listing of two more of its wholly-owned arms. This decision, made via a circular resolution on Tuesday, paves the way for the initial public offerings (IPOs) of Mahanadi Coalfields Limited (MCL) and South Eastern Coalfields Limited (SECL).
Board Nod for Dual Listings
The Coal India board formally approved the listing proposal for SECL, a move that will now be communicated to the Ministry of Coal. The ministry will subsequently forward it to the Department of Investment and Public Asset Management (DIPAM) for final clearance. In a parallel communication to the stock exchanges, CIL also confirmed the board's approval for the MCL IPO.
This development comes on the heels of the impending IPO of another subsidiary, Bharat Coking Coal Limited (BCCL). The market reacted positively to the news, with CIL's stock price surging 3.5% on Tuesday, touching the Rs 400 mark on the bourses.
Financial Powerhouses: MCL and SECL in Focus
The two subsidiaries earmarked for listing are major contributors to India's coal production. Mahanadi Coalfields (MCL) stands as one of CIL's leading production units. In the 2024-25 fiscal year, it achieved a record dispatch of 210 million tonnes against a production of 225 million tonnes. Financially, MCL is robust, posting a revenue of Rs 36,606 crore and a profit after tax (PAT) of Rs 10,823 crore. Its net worth is reported at Rs 18,278 crore. It is primarily an open-cast mining operation.
South Eastern Coalfields (SECL), on the other hand, produced 167 million tonnes of coal in the same period, with a significant underground mining contribution of over 11 million tonnes. The company reported a total revenue of Rs 35,871 crore and a PAT of Rs 4,648 crore, with a net worth of Rs 16,870 crore.
The Broader Divestment Roadmap
The approval for MCL and SECL listings is part of a larger strategic plan by the Maharatna company. During the CIL Annual General Meeting in August, the chairman had indicated plans to kick off roadshows for the IPOs of Bharat Coking Coal (BCCL) and the Central Mine Planning and Design Institute (CMPDI).
Both CMPDI and BCCL had already filed their draft red herring prospectuses (DRHPs) with the Securities and Exchange Board of India (Sebi) in May and June, respectively. These proposed IPOs are structured as offers for sale (OFS) by Coal India, with no fresh issue of shares. The company plans to sell up to 7.1 crore shares in CMPDI and up to 46.5 crore equity shares in BCCL. Market sources suggest that the BCCL IPO is likely to be the first to hit the market, followed by the newly approved listings of MCL and SECL.
This series of public offerings represents a major push by the government to monetize assets and increase public participation in these profitable, strategically important coal-producing companies.
