Bharat Coking Coal will be raising Rs 1,071.11 crores by going public. The issue is entirely an offer for sale of 46.57 crore shares. The IPO will open for subscription on January 09 and will close on January 13. The company has kept the IPO price band in a range of Rs 21 to Rs 23 per equity share.
Bharat Coking Coal: GMP
Bharat Coking Coal’s shares were fetching a grey market premium of 48.70%, trading at Rs 34.2 per equity share. This brings gains on a single lot to Rs 6,720.
Investors must understand that the grey market is an unofficial place to trade shares illegally.
Bharat Coking Coal: Allotment and listing
The allotment for the IPO shares is expected to be finalised on January 14, while the listing on the bourses BSE and NSE is expected to be on January 16, as per the tentative schedule.
Bharat Coking Coal: Lot size
A retail applicant needs to apply for a minimum of one lot that contains 600 shares, amounting to Rs 13,800. The lot size investment for a small NII is 15 lots of 9,000 shares, aggregating to Rs 2 lakh, and for a big NII, it is 73 lots of 43,800 shares, totalling to Rs 10 lakh.
Bharat Coking Coal: Book runner and registrar
IDBI Capital Markets Services is the book-running lead manager for the IPO, and Kfin Technologies is the registrar of the issue.
Bharat Coking Coal: Risks
Poor quality coal: The quality of Indian coking coal is usually considered poor compared to coal from other countries, due to its high ash content.
Inaccuracy of reserve and resource estimates: The company’s future performance depends on the accuracy of its coal reserve and resource estimates, which are based on various geological and economic assumptions.
Environmental and climate mandates: BCCL is exposed to risks from evolving environmental requirements tied to the Paris Agreement and India’s 2070 net-zero targets.
Bharat Coking Coal: Expert’s take
“Bharat Coking Coal, with a strong market share in the industry valued at 8.64x P/E on FY25 earnings (at the upper band) is valued fairly. Considering the company’s consistent track record & superior financial metrics, the valuation is fully priced in. Hence, we recommend subscribing to the IPO for listing gains,” said Anand Rathi Research in an IPO note.