BHEL and Coal India Form New Joint Venture to Boost Coal Gasification

On May 28, 2024, Bharat Heavy Electrical Limited (BHEL) informed in a stock exchange filing about the incorporation of a Joint Venture company.

Objective of the Joint Venture Incorporation

The company stated that a Joint Venture Agreement (JVA) was signed between BHEL and Coal India (CIL) to undertake Coal to Chemicals business, i.e., to engage in the business of coal gasification to produce syn-gas, Ammonia and Nitric acid as intermediate products and Ammonium Nitrate as end product.

The newly incorporated Joint Venture company between BHEL and Coal India Ltd is Bharat Coal Gasification and Chemicals Limited (BCGCL).

Shareholding and Investment Details

Bharat Coal Gasification and Chemicals Limited is a subsidiary of Coal India Limited in which CIL holds 51% and BHEL holds 49% equity. The authorised capital is ₹11 crore and the Paid up Capital is ₹1 lakh. Coal India Ltd got 5,100 equity shares at ₹10 per share amounting to ₹51,000. BHEL got 4900 equity shares at ₹10 per equity share amounting to ₹49,000.

Regulatory or Government Approvals

For the formation of this joint venture company, BHEL and CIL required certain approvals and they got clearance from NITI Aayog and Department of Investment and Public Asset Management (DIPAM).

About BHEL 

Bharat Heavy Electricals Ltd (BHEL) is an integrated power plant equipment manufacturer involved in designing, manufacturing, engineering, erecting, commissioning, testing, and servicing a diverse range of products and services. They cater to key economic sectors including power, industry, renewable energy, transportation, oil & gas, and defence. BHEL is owned and managed by the Government of India.

On May 29, 2024, the share price of Bharat Heavy Electricals Ltd opened at ₹291.00, touching the day’s high at ₹295.25, as of 9:40 AM on the NSE.

About Coal India Ltd

Coal India Ltd is primarily involved in mining and production of Coal. The company is also engaged in the operation of Coal washeries. The main clients of the company are steel and power sectors. They also serve other sectors, such as fertilisers, cement, brick kilns, etc.

On May 29, 2024, the share price of Coal India Ltd opened at ₹482.10, touching the day’s high at ₹490.85, as of 9:40 AM on the NSE.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.