Mumbai: Coal India’s subsidiary, Central Mine Planning and Design Institute Ltd (CMPDIL), has taken the first step toward going public. The company has filed its draft red herring prospectus (DRHP) with SEBI, India’s capital markets regulator, to raise funds through an initial public offering (IPO).
The entire IPO will be an offer for sale. This means CMPDIL will not issue any new shares. Instead, the parent company, Coal India, will sell up to 7.14 crore of its shares in the company.
CMPDIL is a government-owned firm that offers consultancy services for mine planning and mineral exploration. According to the draft papers, CMPDIL is the largest coal and mineral consultancy company in India.
Two financial firms—SBI Capital Markets and IDBI Capital Markets and Securities—are managing the IPO process. They are the book-running lead managers for the issue.
The government has been planning to list both CMPDIL and another Coal India unit, Bharat Coking Coal Ltd (BCCL), for some time. A recent statement from Coal India confirmed that work on listing both companies is currently underway.
While CMPDIL has already filed its draft papers, BCCL’s papers have not yet been submitted. Coal India is expected to file the DRHP for BCCL soon.
Debasish Nanda, Coal India’s Director of Business Development, spoke about the listing plans during the CII Mining and Construction Equipment Summit held on May 19. He said the company is working on the draft papers for BCCL and will file them shortly.
The coal ministry had earlier stated that the listing of CMPDIL and BCCL will happen, but the timing will depend on market conditions.
CMPDIL’s IPO is part of the government’s plan to unlock value from public sector undertakings and to increase transparency and efficiency in state-run firms.
This move also supports the broader aim of disinvestment by the Indian government, allowing investors to take part in important sectors like coal and mining.
(With agency inputs)
