New Delhi: The government aims to collect up to ₹5,000 crore by selling its shares in state-run Coal India Ltd (CIL), in a bid to meet the disinvestment and asset monetisation target of ₹80,000 crore for the current financial year (FY27).
In a post on X (formerly Twitter), Department of Investment and Public Asset Management (DIPAM) secretary Arunish Chawla said that the government will divest a 1% equity stake, with a green shoe option to sell an additional 1% if investor demand is higher than expected.
The floor price for the offer for sale (OFS), where existing shareholders or promoters divest stakes without issuing new shares, has been set at ₹412 per share, Chawla said.
At the notified floor price, the government is expected to mobilise over ₹2,500 crore through the base 1% stake sale, while the proceeds could cross ₹5,000 crore if the additional green shoe option is fully exercised.
“With strong operational and financial performance, consistent returns and attractive dividends, CIL continues to offer a compelling long-term investment opportunity,” he said.
The OFS opens for non-retail investors on 27 May and for retail investors on 29 May, Chawla said in his post.
The OFS is part of the government’s broader disinvestment and public shareholding strategy aimed at improving market liquidity and raising non-tax revenue through stake sales in listed public sector enterprises.
According to data available on the DIPAM website, the government currently holds 3.89 billion shares in Coal India, representing a 63.13% stake in the company. Based on the previous day’s closing price of ₹458.25 per share, the government’s holding is valued at around ₹1.78 trillion, while Coal India’s total market capitalisation stands at about ₹2.82 trillion.
The CIL share sale assumes significance as the government has accelerated efforts to raise non-tax revenue through stake sales and asset monetisation amid rising expenditure commitments and infrastructure spending plans.
The Centre has increasingly relied on minority stake sales in listed public sector enterprises to meet disinvestment targets after several large strategic sale proposals faced delays.
Coal India remains a key revenue-generating PSU for the government through dividends and taxes. The company accounts for over 80% of domestic coal production and continues to play a critical role in ensuring fuel supply to thermal power plants, which still contribute the bulk of India’s electricity generation.
The Coal India OFS comes days after the government launched an OFS in Central Bank of India, which was subscribed 2.35 times on the first day after opening for institutional investors on 22 May. The government is using the OFS route more actively this year to garner higher receipts while also improving public shareholding in state-run companies.
The strong response to the Central Bank of India OFS came at a time when the government has set an ambitious disinvestment and asset monetisation target of ₹80,000 crore for FY27. The government garnered ₹16,885.56 crore from disinvestment in FY26, compared with ₹10,163.02 crore in the previous fiscal year, DIPAM data showed. Besides disinvestment receipts, ₹28,420.49 crore was raised through asset monetisation in FY26. There were no such asset monetisation receipts before FY26.
Major transactions, including those of IDBI Bank and Life Insurance Corporation of India (LIC), are expected to support revenue mobilisation during the year.
Currently, the government holds 89.27% stake in Central Bank of India and, following the exercise of the green shoe option in the ongoing OFS, its holding is expected to decline further.
Mint reported on 13 May that the ministry of railways is planning to dilute 5-10% stakes in six listed railway public sector undertakings and another 2-3% in another listed company through offer-for-sale transactions in FY27.
