Coal India asks subsidiary Central Coalfields Limited to clarify share valuation norm
KOLKATA: The board of directors of Coal India is not too happy with the share price valuation norm adopted by its subsidiary Central Coalfields Limited and has asked for clarifications about the evaluation method used.
The board of directors ofCentral Coalfields, at its meeting held on June 16, 2016 considered and approved buyback of 23.5 lakh fully paid equity shares of face value Rs 1,000 each at price of Rs 4,800 per share totalling Rs 1,128 crore. The evaluation norm used by Central Coalfields is different from the evaluation norm used by other subsidiaries. Had Central Coalfieldsused the same valuation norm, the share price would have been higher and Coal India would have received a little larger sum through the buyback.
“All subsidiaries should have used the same share price evaluation method. However, Central Coalfields used a method that was different from the other four subsidiaries,” said a senior CIL official.
“The board of directors of Coal India, at a meeting held on June 18, have asked for clarification about the valuation norm used by CCL. The meeting was convened to accept the share buy-back proposals announced by the five subsidiaries of Coal India. The board has not yet accepted the proposals,” he said