Coal India Shares Rise After Joint Venture with RRVUNL for Thermal and Renewable Energy Projects

Shares of Coal India advanced on Tuesday, September 24, after the state-owned company announced a joint venture with Rajasthan Rajya Vidyut Utpadan Nigam Ltd (RRVUNL) to explore opportunities in the renewable energy sector in Rajasthan.

Shares in Coal India were trading 0.8% higher at ₹504.90 at 9:19 am on the NSE. The stock has risen 31% year-to-date, ahead of the Nifty's 19% rise. In the last one year, shares of Coal India have risen 74%, putting it much ahead of Nifty's 31% rise.

Under this joint venture, Coal India will hold 74% stake and the remaining 26% will be owned by RRVUNL. It will focus on developing 2x800 MW Brownfield thermal power project at RRVUNL's Kalisindh Thermal Power Station. Apart from it, it may undertake other thermal as well as renewable power projects, which include fulfilling its obligation to renewable generation.

The company would be a joint venture among shareholders which would be established as a private limited liability company with an initial paid-up capital of ₹10 lakh. Its authorized share capital would be ₹10 crore equity shares of ₹10 each and the share distribution will follow at incorporation in accordance with the equity stake mutually agreed between the joint venture partners.

The office registered will be in Jaipur, Rajasthan. Coal India shall appoint four executives, and RRVUNL shall nominate two of its members on its board of directors.

In addition to the thermal power plan, the company will also be working with the renewable energy schemes in Rajasthan. The second MoU between Coal India and RRVUNL establishes further renewable energy initiatives under its wing, albeit with the same equity structure, the former holding 74% and the latter 26%.

It further added, "Coal India Limited (CIL) and Rajasthan Rajya Vidyut Utpadan Nigam Limited (RRVUNL) have signed a Joint Venture Agreement (JVA) to pursue Renewable Energy Business in Rajasthan.".

Coal India Limited is a state-owned company that owns mines and mines coal and its products. Its major products are coking coal, non-coking coal, semi-coking coal, and washed coal. All types of mines, open cast and underground, are represented. Coal India sells to all industries like steel manufacturers, power generators, fertilizers, glass, and cement, and so on.

These major subsidiaries of Coal India are South Eastern Coalfields Ltd, Mahanadi Coalfields Ltd, Northern Coalfields Ltd, Bharat Coking Coal Ltd, and so on. The company also renders domestic mining consultancy services and has its mining operations in Mozambique in the African country. Coal India has its headquarters at Rajarhat in the Indian state of West Bengal.