Coal India Subsidiary SECL Files DRHP for IPO to Offload 66.81 Crore Shares via OFS
State-owned mining giant Coal India Limited (CIL) has initiated the listing process for its key subsidiary, South Eastern Coalfields Limited (SECL), by filing a Draft Red Herring Prospectus (DRHP) with the Securities and Exchange Board of India (SEBI). The proposed Initial Public Offering (IPO) is structured entirely as an Offer for Sale (OFS), with promoter Coal India offloading up to 66.81 crore equity shares of face value ₹2 each.
Coal India currently holds 100% of SECL’s paid-up equity capital, representing 668.06 crore shares. Upon successful completion of the issue, the parent company's stake will drop to 90%. Because the offering does not contain any fresh issue component, SECL will receive no capital infusion from the market, with all net proceeds flowing directly to Coal India. Market estimates suggest the offering could raise up to $800 million (approximately ₹6,600 crore to ₹6,700 crore), depending on final valuations and pricing.
Key Issue Details
The proposed issue structure outlined in the draft papers submitted to SEBI:
- Issue Type: 100% Book-built Offer for Sale (OFS)
- Total Number of Shares: Up to 66,81,00,000 equity shares (10% of total equity)
- Face Value: ₹2 per equity share
- Proposed Listing Exchanges: BSE and NSE
- Lead Managers: SBI Capital Markets, ICICI Securities, IDBI Capital Markets & Securities, and Motilal Oswal Investment Advisors
- Registrar: KFin Technologies Limited
- Quota Allocation: Up to 50% for Qualified Institutional Buyers (QIBs), not less than 15% for Non-Institutional Investors (NIIs), and not less than 35% for Retail Individual Investors (RIIs)
Strategic Importance and Operational Scale
Incorporated in 1985 and headquartered in Bilaspur, Chhattisgarh, SECL is a Miniratna Category-I public sector undertaking and ranks as Coal India's second-largest coal-producing arm. In FY26, SECL extracted 176.29 million tonnes (MT) of coal—a 5.25% year-on-year increase from 167.49 MT in FY25. This volume constituted 16.94% of total coal production across India and 22.95% of Coal India's overall aggregate output.
As of September 30, 2026, SECL operated 53 producing mines spanning 13 operational areas across Chhattisgarh and Madhya Pradesh, comprising 19 opencast and 34 underground mines. Opencast mining accounts for the overwhelming bulk of operations, contributing 93.64% of total coal production in FY26. The subsidiary houses marquee mining assets such as Gevra and Kusmunda in Chhattisgarh's Korba coalfield, which are among the largest opencast coal operations globally by capacity.
According to the DRHP, SECL possessed geological coal resources of approximately 47.55 billion tonnes as of April 1, 2026, representing about 11.5% of India’s overall coal reserves. Its audited extractable reserves stood at 4.61 billion tonnes, providing operational visibility for roughly 26 years based on current annual production rates.
Financial Trajectory
SECL's draft filing indicates sustained revenue and margin growth:
- FY26 Full Year: Revenue from operations reached ₹32,956.52 crore, up from ₹29,998.30 crore in FY25. Profit after tax (PAT) rose to ₹4,754.59 crore from ₹4,540.40 crore, while operational EBITDA stood at ₹7,423.77 crore.
- H1 FY27 Performance: For the six months ended September 30, 2026, revenue increased to ₹16,593.70 crore from ₹15,090.20 crore in H1 FY26. Net profit nearly doubled to ₹2,174.30 crore compared to ₹1,140.90 crore in the same period last year.
Part of a Broader Subsidiary Listing Strategy
The draft filing marks the latest milestone in the Ministry of Coal and Coal India's broader plan to unlock value from operating subsidiaries. Earlier this year, Coal India floated Bharat Coking Coal Limited (BCCL), followed by Mahanadi Coalfields Limited (MCL) filing draft papers in September 2026 for a similar 10% OFS.
Under Coal India's operational roadmap to reach 1 billion tonnes of annual national coal output, SECL has been targeted to scale its production capacity to 245 MT by FY30. While domestic energy transition initiatives continue to gain traction, coal-fired power still supplies the vast majority of India's baseload electricity, ensuring near-term operational demand for domestic mining infrastructure. Further details regarding the IPO price band and opening dates will be announced once SEBI issues its observation letter.
