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UPDATE 1-Coal India's $3 bln IPO filing next week -sources
August 6, 2010 / 8:32 AM / 7 years ago

UPDATE 1-Coal India's $3 bln IPO filing next week -sources

* 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.

Morgan Stanley (MS.N), Citigroup (C.N), Kotak Mahindra Capital (KTKM.BO), Enam Securities, Deutsche Bank (DBKGn.DE), and Bank of America-Merrill Lynch (BAC.N) are the managers on the offering.

    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.

    Other government share sales in the pipeline this fiscal year include public offerings in Steel Authority of India Ltd (SAIL.BO), Hindustan Copper (HCPR.BO) and Power Grid (PGRD.BO).

    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)

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