Coal India Approves Stake Sale In MCL And SECL

Coal India Limited has approved a proposal for reducing its stake in two of its largest subsidiaries, Mahanadi Coalfields Limited (MCL) and South Eastern Coalfields Limited (SECL).

The board has approved in principle the selling of up to a 25% stake in each company through a variety of market mechanisms, including the issuance of new shares via initial public offerings (IPOs).

The plan is still subject to the approval of the regulators and will depend on the market situation at the time of the transaction.

The decision comes after the company had decided in December 2025 to consider listing both the subsidiaries.

Today, 24 March, at 9:40 AM, the Coal India Limited shares were trading at ₹444.75 at the National Stock Exchange (NSE).

What Is The Structure Of The Divestment?

The structure of the stake sale differs between the two companies.

Coal India at Mahanadi Coalfields intends to divest a maximum of 25% of its shares via an offer for sale (OFS). The transaction may be carried out in phases, allowing flexibility based on investor response and market environment.

For SECL, the divestment plan includes an offer for sale of up to 25% equity by Coal India, along with a fresh issue of shares by SECL of up to 10% of its post-issue paid-up equity share capital.

The second issue might result in a further inflow of capital, which the company can use to support operations.

Both issues will likely be done in the Indian market and could be carried out in more than one tranche.

What Is The Next Step In The Process?

Currently, the draft is with the Ministry of Coal, after which it is expected to be forwarded to the Department of Investment and Public Asset Management for further examination.

The companies can only go ahead with the draft filings and other formalities of a public issue when these approvals are received.

In a separate decision, the board has also approved the closure of MJSJ Coal Limited, a step-down subsidiary under Mahanadi Coalfields, in line with regulatory requirements.

Also Read - SEBI Plans Simpler FPI Rules And Intermediary Changes

What Investors Can Expect Next?

The next step will be the regulatory review as well as the submission of the draft proposal documents.

These submissions will provide further insights into the financial status, production volume, and potential valuation of both subsidiaries.

The exact timing of the shares selling to the public will mainly depend on the overall market scenario, particularly the developments in the energy sector.

Moving forward, investors might have a chance to purchase shares in two of Coal India's main operating divisions directly, instead of relying solely on the parent company.

Sources:

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