Coal India (CIL) witnessed a 5% decline in its shares during Thursday's intraday trade as the government commenced the sale of its 3% stake through the offer for sale (OFS) mechanism. The floor price for the stake sale was set at Rs 225 per share, reflecting a discount of approximately 7% from Wednesday's closing price of Rs 241.2. Over the past two months, the stock had experienced a 13% rally until Wednesday.

The government plans to sell up to 3% of its stake in CIL through the OFS route starting from June 1, with the aim of generating around Rs 4,162 crore. This stake sale contributes to the Centre's disinvestment target for the fiscal year 2023-24, which is set at Rs 51,000 crore. The proposal entails the sale of up to 1.5% stake in CIL on June 1 and 2, with an additional option to sell 1.5% as a green shoe option. Currently, the Centre holds a 66.13% stake in CIL.

On Tuesday, CIL's board approved an approximately 8% increase in the prices of high-grade G2-G10 non-coking coal effective from May 31, 2023. This adjustment aims to partially offset a wage hike and is expected to generate incremental revenue of approximately Rs 2,703 crore for the remaining period of the financial year 2023-24.