Stock exchanges will remain shut on January 15 due to municipal corporation elections in Maharashtra, a development that could disrupt the IPO’s post-closure processes such as refunds and credit of shares. While the tentative listing date is January 16, the sequence of events suggests the listing could slip to January 19, subject to official confirmation.
In a circular, the BSE said trading across equity, equity derivatives, commodity derivatives and electronic gold receipts will remain closed on January 15. The day has also been declared a settlement holiday, typically observed during elections or major public events when banking and clearing operations are affected.
How the holiday affects the IPO timeline
Bharat Coking Coal’s IPO opened on January 9 and is scheduled to close on January 13. The allotment is expected to be finalised on January 14, followed by refunds and credit of shares on January 15. However, with January 15 being a settlement holiday, these activities may get pushed to January 16.
If refunds and demat credits are indeed deferred by a day, the listing — which typically follows completion of these steps — is likely to be postponed to January 17 instead of January 16. As of now, there has been no official communication from the company or the exchanges on a revised listing date, though clarity is expected closer to the allotment.
Strong demand keeps focus firmly on listing
The possible delay has done little to dampen enthusiasm around the issue. The Rs 1,071 crore IPO entered its second day of bidding with strong momentum, having been fully subscribed within the first 30 minutes of opening on Day 1.By the end of the second day, the issue was subscribed over 25 times. Retail and non-institutional investors led the demand, signalling high confidence in the company and the valuation on offer.
In the grey market, Bharat Coking Coal shares were trading at a premium of about Rs 11, or nearly 46% over the upper issue price of Rs 23, indicating expectations of healthy listing gains, even amid a volatile broader market.
About the issue
The IPO consists entirely of an offer for sale by Coal India, with no fresh equity issuance. The price band has been fixed at Rs 21-23 per share, with a face value of Rs 10. Investors are required to bid for a minimum of 600 shares, making it a relatively higher-ticket offering for retail participants. The shares are proposed to be listed on both the NSE and the BSE.
Bharat Coking Coal is India’s largest producer of coking coal and the only major domestic supplier of prime coking coal, a critical input for steel manufacturing. As of April 2024, the company held estimated coking coal reserves of around 7.91 billion tonnes, representing nearly 21.5% of India’s total coking coal resources.
In FY25, the company accounted for about 58.5% of India’s domestic coking coal production, underscoring its strategic importance to the steel sector. It operates 34 mines across the Jharia coalfields in Jharkhand and the Raniganj coalfields in West Bengal, regions with long-established coal infrastructure and proximity to major steel plants.
The company also benefits from ongoing investments in coal washeries, which are expected to improve the supply of higher-quality washed coking coal, a key requirement for efficient steel production.
As a wholly owned subsidiary of Coal India, the world’s largest coal producer, Bharat Coking Coal draws comfort from its parent’s operational expertise, scale advantages and financial strength.
Financial profile and valuation views
For FY25, Bharat Coking Coal reported revenue of around Rs 14,401 crore and a consolidated profit of Rs 1,240 crore. While margins have seen some volatility due to pricing and cost dynamics, the business remains debt-free and cash-generative.
Brokerages have largely taken a favourable view of the issue, albeit with measured expectations. Anand Rathi Research values the company at around 8.64 times FY25 earnings at the upper price band and believes the valuation is largely priced in, recommending subscription mainly for potential listing gains.
SBI Securities, in its note, highlighted the company’s dominant market share and reserve base, noting that at Rs 23 per share, the issue is valued at an EV/EBITDA multiple of 6.4 times on post-issue capital. The brokerage also recommends subscribing at the cut-off price.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)