After Mahanadi Coalfields, Coal India readies another arm for IPO; SECL eyes $800 million

New business data points to the fact that South Eastern Coalfields Ltd., a unit of state-run Coal India Ltd., has hired banks for an initial public offering in Mumbai that could raise as much as $800 million, according to people familiar with the matter.

The coal producer has appointed ICICI Securities Ltd., SBI Capital Markets Ltd., Motilal Oswal Investment Advisors Pvt. and IDBI Capital Markets & Securities Ltd. to advise on the share sale, the people stated, asking not to be identified because the information is private.

South Eastern Coalfields aims to file a draft prospectus as early as December, the people stated. Parent Coal India is anticipated to sell shares in the proposed offering, they further noted.

Discussions are ongoing and details including the size and timing of the offering could change, the people stated. Representatives for Coal India, South Eastern Coalfields and the banks didn’t immediately respond to requests for comment.

The potential stock-exchange debut would add to Coal India’s efforts to take some of its subsidiaries public. Another unit, Mahanadi Coalfields Ltd., filed a draft prospectus with India’s market regulator earlier this month. Coal India plans to sell as many as 661.8 million shares in that offering, according to the filing.

The proposed IPO would additionally add to a busy pipeline of Indian share sales as firms seek to tap the country’s deepening pool of domestic capital.

South Eastern Coalfields is among Coal India’s largest subsidiaries. It operates 60 coal mines across central India, with 35 in the state of Chhattisgarh and the remaining 25 in Madhya Pradesh, according to its website.