Coal India Limited has informed the Exchange regarding 'Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015- Giving of guarantee to CIL Rajasthan Akshay Urja Limited (CRAUL), a subsidiary of CIL'.
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Coal India's board has approved giving a 100% corporate guarantee for debt of up to ₹3,160 Crores on behalf of its subsidiary, CIL Rajasthan Akshay Urja Limited (CRAUL). CRAUL is a joint venture where CIL holds 74% and Rajasthan state-owned RRVUNL holds 26%, and is undertaking an 875 MW Solar PV Plant project. The guarantee will back the debt raised to fund the capex for this solar plant. In the event CRAUL defaults on its debt obligations, Coal India's maximum potential liability would be capped at ₹3,160 Crores. The transaction is described as being conducted at arm's length, with no interest from promoter group or other group companies beyond CIL's existing 74% stake.
This is a significant contingent liability that shareholders should note — if the solar project runs into trouble, Coal India could be on the hook for up to ₹3,160 Crores. However, it also signals CIL's push into renewable energy diversification, which could open a new long-term revenue stream beyond coal. Investors should weigh the added balance sheet risk against the strategic benefit of backing a subsidiary's clean energy project.