India’s push to ramp up the domestic rare earth permanent magnet industry has put the spotlight on three listed companies that, at first glance, have little in common.
Larsen & Toubro, Coal India and 20 Microns are among the 20 bidders seeking to build sintered rare earth permanent magnet manufacturing capacity in India. One builds refineries, defence systems, power infrastructure and precision engineering products. Another is India’s largest coal producer and one of the country’s biggest profit generators. The third supplies industrial and speciality minerals to paints, plastics, rubber and other manufacturing industries.
India’s Rs 7,280 Crore REPM incentive scheme explained
The Ministry of Heavy Industries‘ Rs 7,280 crore scheme aims to create 6,000 tonnes per annum of integrated sintered NdFeB rare earth permanent magnet capacity. Five beneficiaries are to be selected through global competitive bidding, with each eligible for up to 1,200 tonnes per annum.
The opportunity is far larger than simply adding another factory. Rare earth permanent magnets sit inside electric vehicle motors, wind turbines, industrial machinery, robotics, aerospace systems, consumer electronics and defence equipment. NdFeB magnets are particularly important because they deliver high magnetic strength in compact applications. But India remains dependent on overseas supply for crucial parts of the value chain.
Building a domestic REPM industry requires more than access to capital. The chain begins with rare earth oxides, particularly neodymium and praseodymium, and moves through metal and alloy production before reaching magnet manufacturing, machining and final application.
That is where the three bidders begin to look very different.
L&T already operates across precision engineering, heavy engineering, electronics, defence and EV-related technologies. Coal India brings financial firepower and is already moving beyond coal through solar, coal gasification and critical mineral initiatives. 20 Microns operates in mineral processing and has a substantial capacity expansion programme under way, although its existing products are different from rare earth permanent magnets.
The government will decide which five of the 20 bidders receive capacity. Before that decision, the available company data offers a closer look at how each of the three could connect its existing business to India’s proposed REPM manufacturing chain.
L&T: Leveraging precision engineering and high EV magnet synergy
Of the three companies, L&T has the most direct connection to the kind of manufacturing ecosystem needed for an integrated REPM facility.
The company is not currently a rare earth magnet producer. But it already operates across several manufacturing businesses that deal with complex materials, precision systems, electronics and high-value industrial equipment.
Its Manufacturing & Products business includes Heavy Engineering, Precision Engineering & Systems, Construction & Mining Machinery and industrial and electronics-related businesses.
During Q1 FY27, the segment generated Rs 4,486 crore in revenue and recorded Rs 680 crore in EBITDA. New orders worth Rs 5,540 crore came into the business during the quarter.
The wider group also has operations in electronics and advanced engineering. Its Electronic Products & Systems business has partnered with EVR Motors for next-generation electric vehicle traction motors, providing an existing connection to one of the largest end-use markets for rare earth permanent magnets.
This connection is important because NdFeB magnets are widely used in permanent magnet synchronous motors, including traction motors used in electric vehicles.
L&T’s manufacturing ecosystem also includes heavy engineering facilities at Hazira and businesses involved in precision systems and defence-related manufacturing.
The company therefore already operates across several parts of the industrial ecosystem where high-performance magnets eventually find applications.
Its financial scale provides another advantage. L&T closed June 2026 with a consolidated order book of Rs 7.79 lakh crore, while group cash and current investments stood at Rs 85,100 crore.
The company generated consolidated revenue of Rs 67,940 crore in Q1 FY27 and reported a profit after tax of Rs 4,120 crore.
For L&T, the REPM opportunity can therefore be viewed as an extension of an already large manufacturing platform rather than an entirely unrelated business.
The biggest unanswered question is how much capacity L&T has sought under the government scheme. The company has not publicly disclosed the proposed REPM capacity, investment or project structure.
Still, among the three bidders, L&T has the broadest existing industrial connection to both the manufacturing process and several major end-use applications.
L&T Q1 FY27 financial and operating data
| Particulars | Q1 FY27 |
| Consolidated revenue | Rs 67,940 crore |
| Reported PAT | Rs 4,120 crore |
| Order inflow | Rs 1.08 lakh crore |
| Order book as of June 30, 2026 | Rs 7.79 lakh crore |
| Manufacturing & Products revenue | Rs 4,486 crore |
| Manufacturing & Products EBITDA | Rs 680 crore |
| Manufacturing & Products EBITDA margin | 15.2% |
| Manufacturing & Products order inflow | Rs 5,540 crore |
| Cash and current investments | Rs 85,100 crore |
Coal India: Balance sheet scale and critical mineral mining push
Coal India’s connection to REPM manufacturing is less obvious than L&T’s, but the company has already been moving beyond coal.
That expansion is important because rare earth magnets are ultimately part of a broader strategic push around minerals, energy security and domestic manufacturing.
Coal India has the financial ability to undertake large industrial projects. During Q1 FY27, the company reported Rs 46,255 crore in revenue from operations and Rs 8,850 crore in profit after tax.
It has set an FY27 capital expenditure target of Rs 16,500 crore and spent Rs 3,399 crore during the June quarter.
The company is already investing in businesses outside its traditional coal operations.
Coal India commissioned 200 MW from its 300 MW solar project at Khavda during Q1 FY27. It is also developing a commercial coal gasification project through its joint venture with BHEL, involving an investment of Rs 25,000 crore.
The company has also been pursuing opportunities connected with critical minerals, a sector that has become strategically important as countries attempt to reduce dependence on concentrated global supply chains.
This gives Coal India’s REPM bid a different industrial logic.
Unlike L&T, Coal India’s advantage is not an existing magnet-related manufacturing platform. Instead, it has the ability to fund large projects, execute mining and resource-linked operations and participate in India’s broader critical mineral supply chain.
Rare earth permanent magnet production requires access to rare earth materials such as neodymium and praseodymium. Securing raw material is therefore one of the most important parts of building a domestic REPM industry.
Coal India’s mining background and its participation in India’s critical minerals push could provide a longer-term link to the upstream part of the supply chain.
However, mining rare earth materials and manufacturing high-performance sintered NdFeB magnets are very different industrial activities. The company would need processing, metallurgy, alloying and magnet manufacturing capabilities that are outside its traditional coal operations.
The REPM bid therefore represents a much bigger diversification step for Coal India than it does for L&T.
Coal India produced 169.63 million tonnes of coal during Q1 FY27 and recorded coal offtake of 197.86 million tonnes. Its scale in mining is enormous, but its eventual role in the REPM chain will depend on whether it is looking primarily at upstream materials, integrated manufacturing or a partnership-led route.
Coal India Q1 FY27 financial and operating data
| Particulars | Q1 FY27 |
| Revenue from operations | Rs 46,255 crore |
| EBITDA | Rs 14,349 crore |
| EBITDA margin | 31% |
| PAT | Rs 8,850 crore |
| Coal production | 169.63 million tonnes |
| Coal offtake | 197.86 million tonnes |
| Overall sales quantity | 198.23 million tonnes |
| Average realisation | Rs 2,276.62 per tonne |
| Q1 capex | Rs 3,399 crore |
| FY27 capex target | Rs 16,500 crore |
| Debt-equity ratio | 0.12 times |
20 Microns: Beneficiation expertise meets a high technical leap
20 Microns is the smallest of the three listed bidders, but its business offers a different possible connection.
The company specialises in industrial minerals, micronised and sub-micronised minerals, performance minerals, specialty chemicals and functional additives.
Its products are processed and engineered for use in paints and coatings, plastics, rubber, inks and other industrial applications.
That makes 20 Microns fundamentally a mineral processing and materials company.
The connection to rare earth magnets lies not in existing magnet manufacturing but in the company’s experience in mineral beneficiation, processing, particle engineering and the development of specialised mineral products.
The REPM manufacturing chain begins with raw material and requires highly specialised processing before rare earth metals can be converted into alloys and ultimately magnets.
20 Microns does not currently produce neodymium-praseodymium oxide, rare earth metals or NdFeB magnets. But its existing business is closer to materials processing than the finished application businesses of many other manufacturers.
The company is also expanding capacity.
It has announced a Rs 100 crore expansion programme over 24 months, including Rs 30 crore for Indian facilities and Rs 40 crore for Malaysian operations. Its Malaysia plans target annual production capacity of 1.08 lakh tonnes and quarrying capacity of 0.96 lakh tonnes by mid-FY28.
This existing expansion does not represent an REPM investment. But it shows the company is already pursuing capacity growth in minerals and materials.
The scale difference between the three companies is substantial.
20 Microns reported revenue from operations of Rs 244.72 crore in Q1 FY27, EBITDA of Rs 32.40 crore and PAT of Rs 17.74 crore.
If the company wins capacity under the REPM scheme and develops a commercially meaningful manufacturing operation, the new business could become significant relative to its existing size.
But it would also represent the biggest technological leap among the three. Rare earth magnet production requires metallurgy, alloy technology and highly specialised manufacturing capabilities beyond the company’s existing industrial mineral operations.
20 Microns therefore has a materials-processing connection, but converting that into integrated NdFeB magnet manufacturing would require a substantial expansion in technological capabilities.
20 Microns Q1 FY27 financial and operating data
| Particulars | Q1 FY27 |
| Revenue from operations | Rs 244.72 crore |
| Total income | Rs 246.04 crore |
| EBITDA | Rs 32.40 crore |
| EBITDA margin | 13.2% |
| PBT | Rs 24.18 crore |
| PAT | Rs 17.74 crore |
| EPS | Rs 5.04 |
| Planned capex | Rs 100 crore |
| India facilities allocation | Rs 30 crore |
| Malaysia operations allocation | Rs 40 crore |
| Sievert JV allocation | Rs 15 crore |
| R&D and ESG allocation | Rs 15 crore |
| Malaysia production capacity target by mid-FY28 | 1.08 lakh tonnes |
| Malaysia quarrying capacity target by mid-FY28 | 0.96 lakh tonnes |
How 1,200-tonne allocation impacts revenue scale across bidders
The government’s scheme allows each successful bidder to receive up to 1,200 tonnes per annum out of the proposed 6,000 tonnes per annum of total capacity.
That means the eventual project size could be material for all three companies, but not in the same way.
For L&T, an REPM facility could fit into a much larger engineering and manufacturing portfolio. Even a 1,200-tonne-per-year facility would enter a group that generated Rs 67,940 crore in quarterly revenue.
For Coal India, the project would represent another step away from a business built overwhelmingly around coal. The company’s financial strength could support a large project, but building magnet manufacturing capability would require an entirely new technical platform.
For 20 Microns, even a smaller allocation could be substantial relative to its existing revenue base of Rs 244.72 crore in a quarter. The company already operates in minerals and materials processing, but the technological requirements of NdFeB magnet manufacturing would take it considerably beyond its present product portfolio.
Conclusion
The final allocation will therefore reveal more than just who won a government-backed manufacturing project.
It will show which companies the government believes can build an integrated chain from rare earth raw materials to finished magnets.
At present, L&T has some key magnet manufacturing synergy in place while Coal India brings financial muscle and a possible upstream link through minerals and mining. 20 Microns brings materials-processing experience, but the greatest need to move into new technology and manufacturing capabilities.
The winners will ultimately be judged not by the size of their current businesses alone, but by whether they can build the chain that India currently lacks: from rare earth material to high-performance sintered magnets that can be used in electric vehicles, renewable energy, electronics, aerospace and defence.