Coal India’s Subsidiary Files Draft Red Herring Prospectus

Coal India Ltd’s mining consultancy arm, Central Mine Planning and Design Institute Ltd (CMPDI), has filed a draft red herring prospectus (DRHP) with SEBI and stock exchanges to sell 71.4 million shares, representing 10% of its holding in the wholly owned subsidiary. The shares have a face value of ₹2 each. Proceeds from the sale will go fully to Coal India.

CMPDI, India’s largest mine and mineral exploration entity, holds about 85% market share and offers services including mine closure and designing plans. Geological exploration and resource evaluation account for over 46% of CMPDI’s annual revenues.

Over the past decade, CMPDI has diversified into infrastructure engineering, environmental management, geomatics, specialised technology services, and management systems, mostly for the coal and minerals sector. The company also developed Coal India’s in-house e-auction portal and led technological upgrades for Coal India and its mining subsidiaries.

While Coal India contributes about 67% of CMPDI’s revenue, the consultancy has successfully expanded its client base beyond its parent, reducing dependence on Coal India. Annual revenues grew 21% year on year to ₹21 billion in 2024-25, after rising 25% to ₹17 billion in 2023-24. Net profit rose 32.5% to ₹6.7 billion in 2024-25 and 69.6% to just over ₹5 billion in 2023-24.

CMPDI’s reliance on Coal India and subsidiaries dropped from 83% of revenue in 2022-23 to 80% in 2023-24 and 67% in 2024-25, though government entities still make up 98-99% of its revenues.

The global mining consultancy market is forecast to grow strongly from 2024 to 2031. India’s mining consultancy revenues are expected to surpass ₹40 billion by 2029-30, up from ₹25.7 billion in 2023-24, driven by rising demand, industry dynamics, and tech advances, CMPDI noted in the DRHP.

Coal India plans to partially divest stakes in CMPDI and Bharat Coking Coal Ltd (focused on coking coal for steel and power), with CMPDI’s listing set to unlock value and reflect its growing independence from Coal India.