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    Coal India falls over 4% as Maharatna plans to make all its 8 subsidiaries public

    Coal India falls over 4% as Maharatna plans to make all its 8 subsidiaries public

    Coal India falls over 4% as Maharatna plans to make all its 8 subsidiaries public
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    By CNBCTV18.com  IST (Updated)

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    CIL is the world's largest coal producer, accounting for 80 percent of domestic coal production in FY22. Although CIL’s shares have not performed well in the market, it may still garner investors' interest because of rising coal prices.

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    Buy / Sell Coal India share

    Coal India Ltd (CIL), the government’s ‘Maharatna’ company, is planning to make all its eight subsidiaries public as increasing power demand after the pandemic has pushed up the cost of fossil fuels.
    Earlier this month, the coal ministry issued a draft Cabinet note to sell 25 percent of state-run Coal India’s consulting unit, Central Mine Planning & Design Institute, and Bharat Coking Coal to the public.
    The other subsidiaries that may go public are Central Coalfields, Eastern Coalfields, Mahanadi Coalfields, Northern Coalfields, South Eastern Coalfields and Western Coalfields.
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    Shares of Coal India touched an intraday low of Rs 176.8, a drop of 4.69 percent on the BSE on Friday. The stock today closed at Rs 183.20 a drop of 1.2 percent from the previous closing price on BSE. Even as the stock has been losing for the last two days, it may still garner investor interest because of rising coal prices.
    Fossil fuel prices have been on the rise as the world has been facing a global fuel shortage due to an increase in power demand after the pandemic and supply disruptions due to the sanctions on Russia for invading Ukraine.
    Axis Securities has a ‘buy’ call on the shares of Coal India, with a target price of Rs 225 for a 12-month investment period.
    According to Axis, Coal India’s EBITDA (earnings before interest, taxes, depreciation, and amortisation) margin has been healthy and stable over the last decade. This has been on account of abundant coal resources, conducive geological conditions, the company’s improving productivity in terms of output, higher outsourcing, and Capex on open cast mines and evacuation expenditure.
    ICICI Direct also has a ‘buy’ call on the share of Coal India, with a target price of Rs 225.
    CIL accounted for 80 percent of domestic coal production in FY22. It plays a crucial role in meeting India's energy needs since 51 percent (as of May 2022) of the country's power is generated by coal-fired plants. Formed in 1975, CIL has a market cap of Rs 1,12,654.67 crore.
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