India's capital markets regulator, the Securities and Exchange Board of India (SEBI), has approved the initial public offering (IPO) of Mahanadi Coalfields, a subsidiary of state-run Coal India, in what is expected to be one of India's biggest public offerings this year, The Hindu BusinessLine reported on Thursday, November 5, citing the regulator's clearance of the company's draft offer document.

Source: The Hindu BusinessLine (Reuters)

SEBI issued its final observations on Mahanadi Coalfields' draft offer document on November 4, Moneycontrol reported. The same round of observations also cleared the draft papers of defence technology company Sagar Defence Engineering and of Arjun Jewellers. Companies that file through the regular route, as Mahanadi Coalfields did, have one year from the observations to open their public issue.

Source: Moneycontrol

The offer is entirely an offer for sale (OFS): Coal India, the world's largest coal producer, will sell up to 661.8 million shares — 66.18 crore shares, or about a 10% stake — of the subsidiary it owns, the draft prospectus showed. No new shares will be issued, so the money raised will go to Coal India as the selling shareholder, not to Mahanadi Coalfields itself. The company filed its draft papers in August 2026.

Why Mahanadi Coalfields matters

Mahanadi Coalfields operates primarily in eastern Odisha and is one of the largest coal producers in the country. It accounted for 21% of India's overall domestic coal production and 28.4% of Coal India's total coal production in fiscal year 2026, The Hindu BusinessLine reported. The draft papers, citing a CRISIL report, put its output at about 218.31 million tonnes in fiscal 2026 across 17 mines, according to IPO Central's summary of the filing. Coal India as a whole contributed about 74% of India's total coal production in fiscal 2026.

Source: IPO Central (DRHP summary)

The listing is part of a wider plan Coal India flagged in March, when it said it could sell up to 25% stakes in subsidiaries Mahanadi Coalfields and South Eastern Coalfields through IPOs or other routes. The South Eastern Coalfields offer is already further along in the process.

Coal India's other big subsidiary has already filed its own offer document. Read: South Eastern Coalfields files for IPO

How large the Mahanadi offer could be is still based on reporting, not on a filed price band. Bloomberg reported on November 2, citing sources, that Coal India is preparing to launch the IPO as early as this month, that the offering could raise as much as $1 billion and that it could value Mahanadi Coalfields at as much as $10 billion. The company has not confirmed a launch date, and no price band has been announced.

What happens next is procedural: Mahanadi Coalfields must file its final offer document, after which the price band and opening dates will be announced. SEBI's observations clear the offer paperwork; they are not an endorsement of the company or its shares. The clearance adds another marquee state-run name to a year that has already seen a string of high-profile offerings in India, including those by Jio Platforms and the National Stock Exchange of India, underscoring strong investor appetite for large listings, The Hindu BusinessLine noted.