Coal India shares slip 7% as OFS kicks off; Morgan Stanley retains target price

Shares of Coal India Ltd fell 7 per cent in Wednesday's trade, with the stock falling to a low of Rs 427.80 apiece on BSE, as the government kicked off its offer for sale (OFS) at a floor price of Rs 412 per share, a discount of 10 per cent over Tuesday's closing price. The stock slipped 6.64 per cent in early trade, but cut losses as the session progressed, quoting at Rs 436.35 apiece by 9.23 am, still down 4.78 per cent. 

Non-retail investors are allowed to bid for the OFS today. Retail investors, employees and non-retail investors who may carry forward bids, would be allowed to bid for the issue on Friday, after Thursday's exchange holiday. 

Morgan Stanley has suggested an 'Equal weight' on the Coal India stock with an unchanged target price of Rs 420 apiece. Volatility is expected on the Coal India counter in the near-term. The scrip has 14 'Buy' or 'Strong Buy' calls, five 'Hold' and seven 'Sell' or 'Strong Sell' recommendations, as per data publicly available with Trendlyne.

The government, which owned 63.13 per cent stake in Coal India as of March 31, 2026, is looking to sell up to 61,627,283 shares in state-owned coal mining firm, as the base offer size. This represents 1 per cent of the total paid-up equity share capital of Coal India. The issue will run on May 27 and May 29, 2026. 

In the case of oversubscription, the intends to sell an additional 61,627,283 equity shares, representing another 1 per cent of the total issued and paid up equity share capital. This would be done through a separate, designated window of BSE and NSE. 

While placing bids, non-retail investors may, today, indicate their willingness to carry forward their un-allotted CIL bids to T+1 day for allocation to them in the unsubscribed portion of retail category.

"Only Retail Investors and Employees shall be allowed to place their bids on T+1 day, i.e., May 29, 2026. Further, those non-Retail Investors who have placed their bids on T day and have chosen to carry forward their unallotted bids to T+1 day, shall be allowed to revise their bids on T+1 day as per the OFS Guidelines," Coal India told stock exchanges.

Coal India said there is a 168 million tonne (mt) coal buffer to meet the summer demand, allaying concerns over supply issues. Ahead of the OFS, it said Coal stocks at domestic coal-based plants stood at 47.6 mt as on May 23, while the coal inventory at CIL’s own mine heads at a comfortable level of 113.5 mt on May 24, ahead by 10 per cent year-on-year.