Coal India shares rise 3.5% as subsidiary Bharat Coking Coal plans Rs 1,300 crore IPO

Coal India Ltd shares rose 3.5% to Rs 400 in Tuesday trading, following reports that its wholly owned subsidiary, Bharat Coking Coal (BCCL), is likely to enter the primary market within the next two weeks, according to an ETNow report.

The upcoming public issue is expected to be a pure offer for sale, with Coal India planning to divest around 10% of its stake in BCCL. This would involve the sale of approximately 46.57 crore equity shares. No fresh shares will be issued, meaning the entire proceeds from the IPO will go to the parent company rather than BCCL itself.

ETNow reported that the IPO could be sized at around Rs 1,300 crore, implying a pre-listing valuation of roughly Rs 13,000 crore for BCCL. Details such as the price band, lot size, and final issue structure are expected to be announced closer to the launch, in consultation with the book-running lead managers.

ICICI Securities and IDBI Capital Markets & Securities are managing the issue, with KFin Technologies appointed as the registrar. The Securities and Exchange Board of India (Sebi) had cleared BCCL’s draft red herring prospectus in September, clearing the path for its listing.

Bharat Coking Coal is a major producer of coking coal in India, a key raw material for steel production. The company also produces non-coking and washed coal, catering mainly to the steel and power sectors.

Coal India’s stock is now approaching its 52-week high of Rs 417.25, indicating the stock is trending near its yearly peak. The company’s market capitalisation stands at Rs 2,44,598 crore
In terms of valuation, Coal India trades at a price-to-earnings (PE) ratio of 7.63 and a price-to-book (PB) ratio of 2.38, suggesting it is relatively attractively priced.

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From a technical standpoint, the 14-day Relative Strength Index (RSI) sits at 57.1, in the neutral zone, while the stock is trading above all eight key simple moving averages (SMAs), signalling a sustained bullish trend.

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