The proposed issue comprises an offer for sale of up to 66.18 crore shares by Coal India and is estimated to raise around ₹9,500 crore.
Highlights:
- Mahanadi Coalfields has filed its Red Herring Prospectus.
- The prospectus is dated November 13.
- Coal India plans to sell up to 66.18 crore equity shares.
- The proposed sale represents a 10% stake in the subsidiary.
- The issue is estimated to fetch around ₹9,500 crore.
- The IPO remains subject to approvals and market conditions.
Kolkata, November 14: Mahanadi Coalfields Ltd (MCL), a wholly owned subsidiary of Coal India Ltd, has filed the Red Herring Prospectus for its proposed initial public offering, advancing the parent company’s plan to unlock value through subsidiary listings.
The prospectus, dated November 13, was filed with the Registrar of Companies, the Securities and Exchange Board of India, the BSE and the NSE, Coal India said in a regulatory filing on Saturday.
The proposed IPO comprises an offer for sale of up to 66.18 crore equity shares by Coal India, representing a 10% stake in Mahanadi Coalfields. The issue is estimated to fetch around ₹9,500 crore, although the final proceeds will depend on the offer’s pricing and completion.
Coal India to sell existing shares
Under the proposed structure, Coal India will sell part of its existing shareholding in MCL to public investors. As the issue comprises an offer for sale, the proceeds will go to the selling shareholder, Coal India, rather than to Mahanadi Coalfields as fresh capital.
If the full proposed 10% stake sale is completed, Coal India would retain a 90% holding in the subsidiary, preserving its controlling ownership after the public issue.
The filing marks a step towards the proposed listing. However, the public issue remains subject to applicable approvals, market conditions and other relevant considerations, according to the regulatory disclosure.
Subsidiary value-unlocking plan
The proposed IPO forms part of Coal India’s efforts to unlock value in its subsidiaries through stake sales and separate stock exchange listings.
A listing would give public investors an opportunity to own shares directly in Mahanadi Coalfields, while establishing a separate market valuation for the business. Coal India would continue to hold a substantial majority stake under the proposed offer structure.
For prospective investors, the issue price, bidding dates and other offer terms will be key details to watch. These were not specified in the information provided in the announcement.
The estimated ₹9,500-crore issue size should therefore be treated as indicative. The eventual amount raised will depend on the final offer terms, while the timing of the transaction will also depend on the conditions and approvals cited in the filing.
