After mopping up ₹4,185 crore through a 3% stake sale in state-run Coal India, the government of India will sell 92.44 lakh shares, or 0.15% equity stake, to eligible employees at ₹226.10 apiece via offer for sale (OFS). The employee OFS will remain open from June 21, 2023 (10:00 AM) to June 23, 2023 (05:30 PM) (both days inclusive), the company said today.

"This is to inform you that in accordance with the approval given by the Alternative Mechanism, basis the recommendations received from the high-level committee of officers, Government of India, on May 31, 2023, the Seller is proposing to offer up to 92,44,092 equity shares (representing 0.15% of the total paid-up equity share capital of the Company) of the face value of ₹10 each to the eligible employees of the Company at a price of ₹226.10 per equity share. The Employee OFS will remain open from June 21, 2023 (10:00 AM) to June 23, 2023 (05:30 PM) (both days inclusive)," the company said via a stock exchange filing.

In an OFS, the promoters sell their shares to raise more funds. The PSU stock closed 0.48% down at ₹227.30 today, down from ₹228.40 touched during the previous day. The company’s market capitalisation has dropped to ₹1.40 lakh crore. As of March 2023, the government of India held a 66.13% stake in Coal India, while 33.87% shareholding is public.

The central government earlier this month had proposed to sell a 3% stake in the world’s largest coal mining company. The OFS opened on June 1 for non-retail investors and for retail investors on June 2.

Coal India’s (CIL) May 2023 production rose to a record 60 million tonnes (MTs), logging 9.5% growth over the same month last year with an increase of 5.2 MTs. Considering the production for May generally hovers in the range of 40 MTs to 48 MTs, the CIL output surge in the current fiscal’s May was substantial.

Although the growth logged in May 2022 was higher at 30%, in real terms the production was 54.7 MTs, exceeding the 50 MT mark for the first time. CIL’s growth in May 2023, in volume and percentage terms, came on the back of a very high base.

The CIL last month approved a new wage agreement allowing higher allowances and benefits for non-executive employees. On May 22, CIL said inked a national coal wage agreement with its 2.38 lakh strong non-executive workers for five years, effective from July 1, 2021. As per the agreement, a minimum of 19% guaranteed benefit on emoluments (basic, VDA, SDA & attendance bonus) and a 25% increase in allowances have been granted to non-executive employees. Further, CIL has made a provision of ₹9,252.24 crore for a period of 21 Months from July 1, 2021, to March 31, 2023, for this effect. So far, in the current fiscal, the Centre has garnered around ₹4,235 crore from PSU stake sales against the full-year target of ₹51,000 crore.

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