The Centre has launched an offer for sale (OFS) of up to 2 per cent of its stake in public sector mining major Coal India Limited (CIL), with the sale window open from 27 May to 29 May 2025. The floor price has been fixed at ₹412 per equity share, representing a 10 per cent discount to Tuesday's closing price of ₹455.90 on the National Stock Exchange (NSE).

Offer Structure and Size

The government has set a base offer size of 6.16 crore equity shares, constituting 1 per cent of Coal India's total paid-up equity capital. An oversubscription option allows the government to offload an additional 6.16 crore shares, taking the total potential divestment to 12.32 crore shares — equivalent to 2 per cent of total equity. The transaction will be executed through a dedicated OFS window on both the BSE and the NSE, in compliance with Securities and Exchange Board of India (SEBI) guidelines.

Who Can Participate and When

Non-retail investors will be able to bid on 27 May. Retail investors, eligible employees, and non-retail investors carrying forward unallotted bids can participate on 29 May. The markets will remain closed on 28 May on account of the Eid holiday, creating a one-day gap in the bidding schedule. Additionally, up to 25,000 equity shares may be reserved for eligible Coal India employees, subject to approval from the competent authority. Employee bids are capped at shares worth up to ₹5 lakh per applicant.

Coal India's Recent Financial Performance

The divestment comes on the back of a strong quarterly showing by the company. Coal India reported a net profit of ₹10,908 crore for the January–March quarter of 2025-26, a 12 per cent rise over the corresponding quarter of the previous financial year. Revenue from operations climbed 6 per cent to ₹46,490 crore during the same period. The company's board also declared a final dividend of ₹5.25 per share for 2025-26, signalling confidence in its cash generation capacity.

Context and What This Means for Investors

This OFS is part of the Centre's ongoing disinvestment programme, which uses stake sales in profitable public sector undertakings to generate non-tax revenue. Coal India, the world's largest coal producer by output, has remained a consistent dividend-paying entity, making it a recurring target for government stake monetisation. The 10 per cent floor price discount is designed to attract institutional participation and ensure the offer is fully subscribed. Notably, the timing — ahead of the financial year's first quarter close — aligns with the government's typical pattern of front-loading disinvestment receipts. Investors will watch whether the oversubscription option is exercised, which would indicate strong demand at the floor price.