Three subsidiaries of the government-run Coal India have slashed their valuation by nearly 75 percent over values declared earlier this month. According to a news report in the Economic Times, valuations declared earlier did not reflect the true numbers of the subsidiaries.
A Coal India executive said that earlier valuations were based on a calculation employed for valuing international companies and therefore weren't valid for India peers.
The three subsidiaries include Northern Coalfield, Mahanadi Coalfields and South Eastern Coalfields.
The company later conducted fresh valuations.
Earlier, shares of Northern Coalfields were valued at Rs 1.629 lakh per share of face value of Rs 1,000. After re-evaluation, this number has been reduced 81 percent to Rs 30,260 per share.
Mahandi Coalfields was valued at Rs 2.900 lakh per share of face value of Rs 1,000 and is now revised to Rs 35,796 per share while South Eastern was valued at Rs 79,777 per share, but have been revalued at Rs 19,599 per share.
Despite revised valuations, Coal India will receive Rs 5063 crore through proposed buybacks by its four subsidiaries. The company has increased the number of shares to be bought back for the same.
Coal India’s four subsidiaries had announced share buy-backs in February.
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