Coal India shares hit near 3 year high as Modi explores breakup

Shares of Coal India Ltd, the world's biggest coal miner, hit their highest level in nearly three years on Thursday after Reuters reported that Narendra Modi, who will become prime minister on Monday, was exploring breaking up the company and opening up the sector.

The stock was among the top gainers on the Nifty, rising as much as 8.22 percent in early trade to 401.40 rupees, the highest since August 2011.

Modi wants to fix India's inefficient coal sector quickly to improve electricity supply across the country. Coal generates more than half of the country's power and is the cheapest form of energy.

Sources said any reform will begin with Coal India, which accounts for 80 percent of India's total coal output but has failed to meet its output targets for years.

Red tape, strikes, protests against land acquisition and delays in obtaining environmental approvals have kept coal output far below demand, making India the world's No.3 importer even though it sits on the fifth-largest reserves.

EDITORIAL OF THE DAY

  • Government must wake up to the woes of electricity generators

    India is not staring at a power crisis yet, but an estimated 46,000 mw of power capacities are at risk today.

FC NEWSLETTER

Stay informed on our latest news!

INTERVIEWS

Sarthak Raychaudhuri

vice-president, HR, Asia South Whirlpool of India

GV Nageswara Rao

MD & CEO, IDBI Federal Life

Timothy Moe

Goldman Sachs

TODAY'S COLUMNS

Arun Nigavekar

Moocs will not replace traditional education

I am revisiting the topic of massive open online course ...

Zehra Naqvi

Minimalism: declutter your life

When you imagine an ideal place to live, you think ...

Gautam Gupta

Our fashion schools need to notch it up

“Creativity is the key to success and primary education is ...

INTERVIEWS

William D. Green

Chairman & CEO, Accenture