India’s $3.5 billion sale of shares in state-run Coal India was doubly oversubscribed a day ahead of the close of the country’s biggest ever stock offer, stock exchange figures showed yesterday.

Bids had been received for 1.29 billion shares, 2.05 times the number up for grabs.

Coal India’s initial public offering, which opened Monday, allows foreign and retail investors to buy into the resource behemoth, which produces 80 per cent of India’s coal. Most bids were at the higher end of the price band of 225-245 rupees ($5 to $5.5) a share, exchange data showed.

“We’re continuing to see a strong response,” an investment banker close to the share issue told AFP on condition of anonymity.

Demand has been heaviest from financial institutions, which have bid for over three times the shares on offer, he said. Small investors have taken up 35 per cent of the shares allocated to them, another banker said.

The offer closed yesterday for financial institutions and will close today for retail investors. Analysts expect institutional demand to make up for any shortfall in retail demand.

Employees have shunned the share issue, bidding for less than one per cent of the stock set aside for them, amid union fears that the sale could lead to full privatisation of the company and job losses.

Coal India boasts the largest extractable coal reserves in the world, with over 22 billion tonnes, ahead of rivals China Shenhua Energy and the world’s largest private-sector miner, Peabody Energy of the United States.

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