Govt to sell 10 per cent stake in Coal India tomorrow

“The President of India, acting through and represented by the ministry of coal, Government of India is the promoter of Coal India has submitted to BSE a copy of Notice of Offer for Sale 31,58,18,220 equity shares with an option to sell an additional up to 31,58,18,220 collectively aggregating to 10 per cent of the total paid up equity share capital of the company,” said the firm in a filing with bourses on Wednesday. The disinvestment would be done through the offer for sale route and up to 20 per cent of the offer size with a maximum purchase of Rs 2 lakh would be reserved for retail investors. They would also be offered a 5 per cent discount on the bid price.

The Centre holds 89.56 per cent stake in the coal PSU. It had earlier divested 10 per cent in 2010 and now needs to meet minimum public float norm of 25 per cent.

“The disinvestment was planned for a long time and is required to meet Sebi’s minimum float norms,” said a senior government official, adding that more stake sales will take place over the next few weeks.

On Wednesday, CIL scrip closed at Rs 384.05 apiece on the BSE, gaining 0.27 per cent from its previous close. The sell-off will also help meet at least half the proceeds from disinvestment, which is targetted at Rs 43, 425 crore in 2014-15 and is crucial to help meet the fiscal deficit targetted at 4.1 per cent of the GDP.

The Centre has just raised Rs 1,725 crore from the 5 per cent sell-off in SAIL this fiscal. The government expects the CIL sell-off along with auction of 2G and 3G airwaves, which could garner Rs 82,395 crore at the base or minimum price, to fetch over Rs 1 lakh crore, according to a PTI report.