Shares of public sector undertaking (PSU) Coal India jumped 3% in Wednesday’s trading session to trade at its highest level in seven months.
Coal India share price touched the day’s high of ₹412.40 on the BSE, extending its gains to the sixth day in a row and nearing its 52-week high of ₹417.25 amid strong buying action. The blue-chip stock has risen 8% in the last six sessions.
As of 11.55 am, 7.88 lakh shares of the company had changed hands, much higher than the two-week average of 5.01 lakh shares.
What’s behind the rally in Coal India shares?
The rally in the Maharatna PSU stock, Coal India, came on the heels of the board nod for the stock market listing of its subsidiaries — South Eastern Coalfields Limited (SECL) and Mahanadi Coalfields Limited (MCL).
In an exchange filing on Tuesday, Coal India said its board of directors have given the go-ahead for SECL and MCL to get listed. The approval accorded to the two subsidiaries will now be forwarded to the Ministry of Coal for onward submission to the Department of Investment and Public Asset Management (DIPAM). The proposed in-principle listings of MCL and SECL are subject to completion of various regulatory approvals.
The decision follows a specific directive from the Ministry of Coal to Coal India to initiate concrete steps to ensure the listing of two of its primary subsidiaries – MCL and SCL within the next financial year.
Approval for divesting subsidiaries is positive as it unlocks cash, strengthens focus on the core business, and boosts investor confidence.
More to come…