* To file prospectus by Monday or Tuesday next week-sources
* Offer to hit market around Oct 15
* Offer may be largest ever by an Indian firm
(Adds details, updates size milestone)
By Prashant Mehra and Pratish Narayanan
MUMBAI, Aug 6 (Reuters) - State-run Coal India, the world’s largest coal miner, will file a draft prospectus for an initial public offering to raise as much as $3 billion early next week, three sources with direct knowledge of the matter told Reuters on Friday.
The company’s public offer of about 630 million shares, or a 10 percent stake, is expected to hit the market around October 15, two of the sources said.
The Indian government, bolstered by its success in share sales in two state-run firms this fiscal year, plans to raise up to 140 billion rupees ($3 billion). If successful, that would be the biggest share sale ever by an Indian firm, surpassing utility Reliance Power’s (RPOL.BO) $2.9 billion IPO in 2008.
The sale is part of a government plan to sell stakes in about 60 state-run firms over the next few years, as it moves to cut a stubbornly high fiscal deficit and garner funds to spend on schemes for the poor. [ID:nSGE64R0BK]
The Indian government plans to raise $8.6 billion through stake sales in fiscal 2011.
Since April, India has raised $260 million by selling shares in state-run utility SJVN’s (SJVN.BO) IPO, and another $211 million through a share sale in Engineers India (ENGI.BO). Both offers saw strong response from investors.
Coal India, based in the eastern city of Kolkata, produced 431 million tonnes in 2009/10 and accounts for nearly 80 percent of coal output in Asia’s third-largest economy. It posted net profit of 83.12 billion rupees ($1.8 billion) in 2009/10, quadrupling from the previous year on the back of rising demand. (Editing by Surojit Gupta and Jui Chakravorty)