Coal India to divest 25% stake in BCCL; company plans subsequent listing

State-owned Coal India Ltd (CIL) announced on Thursday that it is planning to divest 25% stake in its unlisted subsidiary Bharat Coking Coal Ltd (BCCL). The company will also go for the subsequent listing of the subsidiary on stock exchanges after obtaining further clearances, as per PTI reported.

CIL said in a regulatory filing that a meeting of the board of directors to this effect was conducted on March 10, 2022, said PTI.

"As advised by MoC (Ministry of Coal), CIL Board in its 438th meeting held on March 10, 2022 had accorded its 'in-principle' approval to divest 25 percent of paid-up share capital of BCCL held by CIL and its subsequent listing on stock exchanges and advised to forward the proposal to Ministry of Coal for obtaining further clearances," the filing said.

According to PTI, the coal company stated that the proposal had only received "in principle" approval from the company's board of directors and that further action would be taken only after receiving further clearance from the government.

"On receipt of further clearance from MoC (Ministry of Coal) the same would be placed to CIL board and the decision of CIL board would be promptly disseminated to stock exchanges," the filing said.

BCCL produced 24.66 million tonnes (MT) in FY21, versus a target of 37.13 MT, and off-take of 23.13 MT, versus a target of 37.13 MT, said PTI.

According to BCCL's annual report, the company's net turnover in FY21 was Rs 6,149.81 crore, compared to Rs 8,967.56 crore the previous year. This significant fall in sales affected the bottom line of the company's finances.

As a result, unlike in previous years, the company was unable to retain profitability and reported a net loss (LBT) of Rs 1,577.06 crore. According to the report, the company's PBT (profit before taxes) in 2019-20 was Rs 991.12 crore, PTI said.

Coal India produces more than 80% of the country's coal.

BCCL was founded in January 1972 with the goal of operating coking coal mines in the Jharia and Raniganj coalfields. On October 16, 1971, it was taken over by the government. It is a Public Sector Undertaking engaged in the mining of coal and allied activities.