Coal India rose 5.27% to Rs 378.35 at 11:51 IST on BSE on reports that India's Coal Ministry has lifted the cap on the company's e-auction sales.
Meanwhile, the BSE Sensex was up 181.87 points, or 0.64%, to 28,698.46.
On BSE, so far 3.36 lakh shares were traded in the counter, compared with an average volume of 5.34 lakh shares in the past one quarter.
The stock hit a high of Rs 382.30 and a low of Rs 364.10 so far during the day. The stock hit a record high of Rs 423.85 on 11 June 2014. The stock hit a 52-week low of Rs 283.60 on 9 April 2014.
The stock had outperformed the market over the past one month till 7 April 2015, falling 1.25% compared with 3.17% decline in the Sensex. The scrip had, however, underperformed the market in past one quarter, falling 4.13% as against Sensex's 5.97% rise.
The large-cap company has an equity capital of Rs 6316.36 crore. Face value per share is Rs 10.
According to reports, this measure can add incremental operating profits of 7-8% to the company.
Reports suggested that Coal India (CIL) was at loggerheads with the coal ministry around six months ago over the latter's directive to halve its lucrative e-auction volumes.
Out of the total sales of 472 million tonnes (mt) of coal in 2013-14, 58 mt was sold by CIL through e-auctions. However, in September 2014, coal minister Piyush Goyal directed CIL to cut down e-auctions by about 50% to 25 mt in 2014-15 from 58 mt last year. After initially opposing the move, CIL finally agreed to lower its e-auction volume to about 7% of its sales.
Now, the ministry has allowed CIL to revert to the old system, removing the cap on e-auction volumes with effect from April 2015. This might boost CIL's bottom line in the coming days, reports added.
While e-auction sales accounted for one-10th of CIL's sales volume, it reportedly contributed almost 40% of CIL's earnings before interest and tax. Smaller power firms and non-power users are the primary takers of e-auctioned coal as most of the electricity generation firms do not bid aggressively in view of tariff caps, reports said.
On consolidated basis, Coal India's net profit fell 16.2% to Rs 3262.49 crore on 4.9% growth in net sales to Rs 17762.88 crore in Q3 December 2014 over Q3 December 2013.
Coal India is an organized state owned coal mining corporate.
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