Government of India to sell 2% stake in Coal India at ₹412 per share
The offer for sale, valued at roughly ₹5,100 crore, will take place on May 27 and May 29. The floor price is set at ₹412 per share.
What's new
- The government is offloading up to 123.3 million shares, representing 2% of Coal India's equity.
- The sale occurs over two days, May 27 and May 29, with a floor price of ₹412 per share.
- Non-retail investors bid on day one; retail investors and employees participate on day two.
Why this matters
This divestment shows the government's intent to monetize its holdings in state-run majors. The sale increases the free float and liquidity for minority shareholders.
What we're watching
- The level of institutional interest on the first day of bidding.
- Whether the government signals further divestment plans after this tranche.
- The final subscription levels from retail investors on the second day.
The full read
The Government of India is moving to monetize its stake in Coal India, launching an offer for sale of up to 2% of the company's equity. The sale, which covers 123.3 million shares, is priced at a floor of ₹412 per share. At this price, the transaction is valued at approximately ₹5,100 crore, or roughly 1.8% of the company's total market capitalization. The process is split across two days: non-retail investors bid on May 27, while retail investors and employees participate on May 29. There is no retail discount on offer. This divestment is a clear signal of the government's intent to reduce its holding. For minority shareholders, the sale provides a boost to free float and liquidity. The next test is the level of demand from institutional bidders on the opening day.
Questions answered
- How much equity is the government selling?
- The government is offering up to 123.3 million shares, which equals 2% of Coal India's paid-up equity.
- What is the floor price for the offer?
- The floor price for the sale is set at ₹412 per share.
- Are there any discounts for retail investors?
- No. The offer excludes a retail discount.
- How are the bidding days structured?
- Non-retail investors bid on May 27, while retail investors and eligible employees may bid on May 29.
- Is there a limit for employee participation?
- Yes. A total of 25,000 shares are set aside for employees, with an individual investment cap of ₹500,000.