A front loader moves coal at the Tori Siding on the Tori-Shivpur rail line in Chandwa, Jharkhand. (Photographer: Prashanth Vishwanathan/Bloomberg)

Government Sells 3.18% In Coal India, To Get Rs 5,300 Crore

The government on Thursday sold 3.18 percent stake in Coal India Ltd., in the first big ticket disinvestment of current fiscal, which will fetch Rs 5,300 crore to the exchequer.

Retail investors lapped up 6.19 crore shares or 1.56 times the shares reserved for them. As much as 3.96 crore shares were reserved for retail investors, who can individually bid for shares worth up to Rs 2 lakh.

Institutional buyers had on Wednesday bid for 15.84 crore shares or 1.06 times the equity earmarked for them. Taking together the bids from institutional and retail investors in the two day offer for sale, the government has sold 3.18 percent stake in Coal India.

The government had planned to sell over 18.62 crore shares or 3 per cent in Coal India at a floor price of Rs 266 apiece.

On top of the 3 per cent stake sale, the government also had an option to retain an over-subscription (greenshoe option) of another 6 percent stake in CIL’s offer for sale.

The government has exercised greenshoe option to the extent of 0.18 percent in case of Coal India, an official said. Shares of Coal India closed at Rs 261.10, down 1.90 percent over previous close.

The government held 78.32 percent stake in Coal India at the end of September.

The government has already raised over Rs 10,028 crore through PSU stake sale, including by way of follow on offer of Bharat-22 ETF, and initial public offering of four public sector units—RITES, IRCON, Mishra Dhatu Nigam Ltd and Garden Reach Shipbuilders.

The stake sale in Coal India would help the government move forward towards the Rs 80,000 crore disinvestment target in current fiscal. The government had last sold 10 percent stake in CIL through an OFS in Jan. 2015. It had then mopped up about Rs 23,000 crore.