It may be among the most successful initial public offerings (IPOs) in recent memory. The focus has shifted from the massive oversubscription to the listing gains on the first day since Bharat Coking Coal’s shares will be listed on the markets today. Few topics received the same level of interest from institutional and everyday investors. The sum bid was more than INR 1,000,000 crore, even though the issue was only worth around 1,000 crore.
Over 300 times as many acceptable universities subscribed to the part. The amount given to the retail one was about fifty times greater than its part. The gray market, which is a good indicator of a potential listing price, gave it a major thumbs up throughout the pre-IPO and IPO phases, with a premium of 50–60%. The share was expected to list at INR13 above its maximum offer price of INR23 at the time of the last count.
However, rather than being excited about the stock’s potential, experts are wary. Some firmly urge the allottees to book a portion of the earnings on the first day of the listing and hold onto the remainder for future use. Another suggests that if the expected listing gains are 40–60% higher than the offer price, people with a short-term outlook should sell the full quantity.
The shares should only be held by people who have a long-term outlook. According to one of the analysts, “valuations appear fully-priced at the upper end of the issue price (INR23).” Investors must thus exit at a profitable price. Another cautioned that even if the stock appears atractive, a fall is always imminent since the coal industry is cyclical. It is impossible to predict the future with certainty. The majority of experts believe that the maximum listing gain, which might be a lower `9, is shown by the gray market premium of INR13.
It is important to keep in mind that the company, a subsidiary of the state-owned Coal India, would not gain from the IPO. The parent will book the whole amount, reducing its ownership of Bharat Coking Coal. There isn’t an offer for more shares, which could have gone into the IPO company’s coffers to finance future investments, growth, expansion, or other business initiatives.
In fact, the prospectus openly acknowledges that the primary goal is to attain the benefits of listing on the exchanges, which may enhance interaction with external investors, increase liquidity for the stock, which was entirely owned by Coal India, and allow it to raise capital in the future for potential expansion.
Since that the government owns Coal India, the IPO may be a modest effort to support official revenues, which are being strained by poor GST collections. According to certain rating agencies and experts, the finance minister may be able to control the budget deficit in 2025–2026 with the aid of this and other greater attempts efforts to increase revenues through non-tax sources.
In FY-25, Bharat Coking Coal contributed for around 60% of the total coking coal manufacturing, making it the leading producer. As of 2024, its reserves were close to 8,000 million tonnes, making it “among the biggest holders of coking coal reserves in the country.”
The steel and energy sectors are its main clients, and it produces a variety of grades in addition to non-coking and cleaned coal. The states of West Bengal and Jharkhand contain the majority of its coalfields. The prospectus states that the firm expanded over the years, as coal production increased to nearly 33 million tonnes in FY-22 to nearly 16 million tonnes in the first half of 2025-26.
Just over 19 million tonnes were produced in the first half of the prior fiscal year, suggesting a decline in the most recent financial year. With a record annual output of 39 million tons, which was 11% more than the previous highest in FY-17, FY-24 was the strongest year in recent memory.
Due to the prospectus, “loss of any of these customers could have an adverse effect on our business, financial condition, results of operations, and cash flows.” The company’s top 10 purchasers account for almost 80% of its sales. According to statistics from the first half of the current fiscal year, the majority of these purchasers are state-owned companies such as Punjab State Power Corporation, Steel Authority of India, NTPC, and Uttar Pradesh Rajya Vidyut Utpadan Nigam. This “exposes us to certain risks inherent in operating with PSUs (public sector undertakings),” the prospectus continues.
Budgetary limitations, bureaucratic decision-making procedures, and possible shifts in governmental goals or policies are only a few of the specific operational and legal limits that PSUs must deal with. One of the top ten clients also “started their own captive coal production, and their requirement from our Company ceased.” As a result, Bharat Coking Coal only lost one of its primary customers. In a similar vein, its supply contract with one of the top ten clients ended in April 2025.
“We may need to reallocate resources and make new customer acquisition attempts if we lose our important clients. Regarding the fuel supply loss, the company asserts that it discovered new steel customers whose demands outweighed the sales decline.
