Coal India, BCCL shares rise up to 5% as govt designates coking coal as critical mineral

Coal India, BCCL shares rise up to 5% as govt designates coking coal as critical mineral

• Coal India and Bharat Coking Coal shares rose as coking coal named critical mineral
• Govt move aims to cut import dependence and boost domestic steel sector supply
• India's coal output hit a record 1,047.52 MT in FY25, boosting production-consumption ratio.

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The shares of Coal India and Bharat Coking Coal sharply gained in trade on January 29 after the government designated coking coal as a 'Critical and Strategic Mineral' under the Mines and Minerals (Development and Regulation) Act, 1957.

The newly-listed shares of Bharat Coking Coal (BCCL) jumped nearly 5 percent to Rs 39 apiece in the afternoon trading hours of Thursday. Coal India shares meanwhile gained around 3 percent to Rs 456.95 apiece.

Govt designates coking coal as critical mineral:

The Ministry of Coal is a press statement said that the decision was taken on the basis of the recommendations of the High-Level Committee on Implementation of Viksit Bharat Goals (HLC-VB) and policy inputs from NITI Aayog, recognising the “strategic role of coking coal in ensuring mineral security and meeting the requirements of the domestic steel sector”.

The ministry noted that India has approximately 37.37 billion tonnes of coking coal resources, largely located in Jharkhand, with additional reserves in Madhya Pradesh, West Bengal and Chhattisgarh. “Despite this domestic availability, imports of coking coal have increased from 51.20 million tonnes in 2020–21 to 57.58 million tonnes in 2024–25. Currently, around 95 %  of the coking coal requirement of the steel sector is met through imports, leading to significant foreign exchange outgo,” it added.

The inclusion of coking coal in the category will likely facilitate faster approvals, improve ease of doing business and accelerate exploration and mining activities, including of deep-seated deposits, the government said. “Mining of critical minerals is exempt from public consultation requirements and permits the utilisation of degraded forest land for compensatory afforestation, measures that are also expected to encourage greater private sector participation,” it added.

The amendment is expected to reduce India’s import dependence, strengthen supply-chain resilience for the steel sector, and support the objectives of the National Steel Policy, according to the ministry.

What the Economic Survey said about coal:

Finance Minister Nirmala Sitharaman tabled the Economic Survey in the Parliament earlier today. According to the survey, coal “remains crucial” as India has the fifth-largest coal reserves and is the second-largest consumer. Coal contributes 55 percent to the national energy mix and fuels over 74 percent of total power generation, it added.

The survey noted that India’s coal industry reached historic heights in FY25, producing 1,047.52 million tonnes (MT) of coal. This marked a 4.98 percent year-on-year (YoY) increase from the Rs 997.83 MT. “This represents the highest coal production the country has ever achieved, demonstrating the industry's impressive growth and importance to India's energy needs,” it added.

“Driven by this strong domestic output, imports registered a significant 7.9 per cent decline, falling from 264.53 MT in FY24 to 243.62 MT in FY25.15 Furthermore, the ratio of domestic production to consumption has also steadily improved over the past decade, as production growth has consistently outpaced consumption growth,” the Economic Survey further said.

Additionally, the survey noted that India’s steel industry faces critical dependence on imported Coking Coal. “To mitigate global supply risks, the Ministry of Coal launched Mission Coking Coal in 2022 with a view to significantly enhance domestic raw coking coal production to 140 MT by 2030,” it said.

Coal stocks:

Coal India shares hit a fresh 52-week high of Rs 456.95 apiece today. The stock has gained around 8 percent in one week, and 14 percent in one month.

Bharat Coking Coal shares made a stellar stock market debut on the exchanges earlier this month, listing with a premium of nearly 96 percent, following a massive subscription of 147 times between January 9-13 in the primary market.

Shares of Bharat Coking Coal Ltd were listed at Rs 45 per share on the National Stock Exchange (NSE). The stock has so far declined around 13 percent since listing.

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