NewsIPOBharat Coking Coal IPO: ₹1,071 Crore Issue Opens January 9 with Strong Anchor Investor DemandBharat Coking Coal IPO: ₹1,071 Crore Issue Opens January 9 with Strong Anchor Investor Demand
Bharat Coking Coal's ₹1,071 crore IPO opens January 9-13 with strong anchor investor backing of ₹273.13 crore, led by LIC. As India's largest coking coal producer with 58.5% market share, the company shows robust financials with 36.6% profit CAGR (FY23-FY25). Multiple brokerages recommend subscription citing fair valuation and dominant market position, while 50% grey market premium indicates strong listing expectations.
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Bharat Coking Coal Ltd. (BCCL), a wholly-owned subsidiary of Coal India Ltd., is set to launch 2026's first mainboard initial public offering. The three-day public issue opens for subscription on Friday, January 9, and closes on Tuesday, January 13, aiming to raise ₹1,071 crore through an offer for sale.
Strong Anchor Investor Response
Ahead of the public issue, BCCL successfully raised ₹273.13 crore from anchor investors on January 8. Life Insurance Corporation of India emerged as the largest anchor investor, acquiring 3.39 crore equity shares worth ₹78 crore. The anchor investor allocation demonstrates strong institutional confidence in the offering.
| Anchor Investor | Shares (Crores) | Investment Value |
|---|---|---|
| Life Insurance Corporation of India | 3.39 | ₹78 crore |
| Nippon Life India Mutual Fund | 3.26 | ₹75 crore |
| Bandhan Mutual Fund | 3.26 | ₹75 crore |
Brokerage Recommendations and Valuation
SBI Securities has recommended investors subscribe to the issue at the cut-off price, noting that at the upper band of ₹23, the issue is valued at an EV/EBITDA multiple of 6.4x on post-issue capital. The brokerage highlighted BCCL's position as India's largest coking coal producer, accounting for 58.5% of domestic production in FY25, with estimated reserves of 7.91 billion tonnes and 34 operational mines.
Anand Rathi recommended subscribing for listing gains, stating that at 8.64x FY25 earnings at the upper band, the valuation appears fair given the company's consistent track record and strong financial metrics. Mehta Equities also advised subscription for listing gains, citing BCCL's dominant position in India's coking coal value chain and Coal India's technical and financial backing.
Financial Performance and Business Metrics
BCCL has demonstrated robust financial growth with revenue, EBITDA, and profit CAGR of 4.6%, 88.1%, and 36.6% respectively between FY23 and FY25. The company maintains EBITDA margins of 12.7% and return on capital employed at 18.2% in FY25, reflecting operational efficiency in the coking coal sector.
| Financial Metric | Performance (FY23-FY25) |
|---|---|
| Revenue CAGR | 4.6% |
| EBITDA CAGR | 88.1% |
| Profit CAGR | 36.6% |
| EBITDA Margin (FY25) | 12.7% |
| Return on Capital Employed (FY25) | 18.2% |
Issue Structure and Investment Details
The IPO is entirely an offer for sale, through which parent Coal India will divest a 10% stake. Priced between ₹21 to ₹23 per share, the company will offer 46.57 crore equity shares. Retail investors can apply for a minimum lot of 600 shares, requiring an investment of ₹13,800 at the upper price band.
The allocation structure reserves 35% for retail investors, 50% for qualified institutional buyers, and 10% for non-institutional investors. Additionally, shares worth ₹107 crore have been reserved for eligible Coal India shareholders, with investors holding shares on or before January 1, 2026, eligible for the shareholder quota.
Market Expectations and Listing Timeline
Bharat Coking Coal shares are commanding a grey market premium of approximately 50%, indicating strong listing expectations. At the upper price band, the company is expected to achieve a post-issue market capitalisation of around ₹10,711 crore. Post-listing, Coal India's stake will decrease to 90%, remaining above minimum public shareholding requirements.
The basis of allotment is scheduled for January 14, with stock market debut expected on Friday, January 16. IDBI Capital and ICICI Securities serve as book running lead managers for the issue.
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