Introduction
Coal India Ltd (CIL), the state-run coal mining giant, saw its shares jump over 3.5% on Tuesday, May 20, following the announcement of plans to list two of its subsidiaries. The development, coupled with a steady Q4 FY25 performance and dividend declaration, has reignited investor interest in the stock.
Why Coal India Stock Is Buzzing
Coal India shares surged to ₹416.15 apiece on the NSE, marking a gain of 3.34% compared to the previous close. The rally was primarily triggered by news of the company’s plan to file Draft Red Herring Prospectuses (DRHPs) for the public listing of two of its subsidiaries—Bharat Coking Coal Ltd (BCCL) and Central Mine Planning and Design Institute (CMPDI).
This move is seen as a strategic step to unlock value and improve operational focus, boosting market sentiment around Coal India’s broader business roadmap.
Details on BCCL and CMPDI Listing
Coal India Director of Business Development, Debasish Nanda, confirmed at the CII Mining and Construction Equipment Summit that the DRHP filings for the two subsidiaries are in the pipeline and will be submitted soon to the Securities and Exchange Board of India (SEBI).
“We are going to file DRHP soon. We are working on that,” Nanda told reporters, adding that the Book Running Lead Manager (BRLM) for the IPO process has already been appointed.
While the coal ministry had previously signaled intent to list BCCL and CMPDI, the official announcement and initiation of the listing process have now brought the plan into motion. The actual timing of the listing, however, will be based on prevailing market conditions.
Coal India currently operates seven coal-producing subsidiaries and one technical and consultancy services company—CMPDI. The company is responsible for producing more than 80% of India’s coal.
Strategic Expansion into Critical Minerals
Nanda also shed light on the company’s strategic focus beyond coal. Coal India is actively exploring critical mineral projects, both domestically and internationally.
“With regard to critical mineral projects overseas, we are looking at South America, Australia, and Africa,” said Nanda, though he refrained from naming specific companies or regions.
This diversification aligns with India’s broader push towards self-reliance in energy and resource security, especially in key areas like lithium, cobalt, and rare earth elements—all essential for electronics and electric vehicles.
Q4 FY25 Financial Performance
Coal India reported a 12% year-on-year increase in consolidated net profit at ₹9,604.02 crore for the quarter ended March 2025, up from ₹8,572.14 crore in Q4 FY24. However, revenue from operations dipped marginally by 1% to ₹37,824.54 crore versus ₹38,213.48 crore in the corresponding quarter last year.
The company’s EBITDA rose 4% YoY to ₹11,790.15 crore, compared to ₹11,387.59 crore in Q4 FY24. Meanwhile, EBITDA margins improved to 31.2%, up from 29.8% YoY, reflecting better operational efficiency.
Dividend Declaration
Coal India’s board has recommended a final dividend of ₹5.15 per share (face value ₹10) for the financial year 2024-25. This adds to the company’s overall investor-friendly image, reinforcing its commitment to delivering shareholder returns amid consistent performance.
FY25 Coal Production and FY26 Targets
Despite a robust financial performance, Coal India missed its FY25 coal production target by a margin. The company produced 781.1 million tonnes (mt) of coal, which is 7% short of its annual target.
However, the company remains optimistic about FY26, setting ambitious targets:
- Production goal: 875 million tonnes
- Offtake target: 900 million tonnes
These targets align with the government’s focus on reducing coal imports and boosting domestic energy security.
Conclusion
The announcement of IPO plans for BCCL and CMPDI, coupled with a strong Q4 profit surge and forward-looking production targets, has made Coal India one of the standout PSU stocks of the week. With strategic expansions into critical minerals and consistent dividend payouts, the company is well-positioned to remain a major force in India’s evolving energy landscape.
Investors and analysts alike will be keenly watching the upcoming DRHP filings and subsequent market response as Coal India navigates this next phase of growth.
