On January 19 this yr, Bharat Coking Coal Restricted (BCCL), India’s largest coking coal producer and a subsidiary of Coal India Restricted, listed on the inventory market by way of an preliminary public providing (IPO). Regardless of the difficult international market atmosphere, the BCCL IPO created capital market historical past by turning into the highest-ever value within the Indian mainboard IPO market. The 46 million shares on supply to lift an extra Rs 107 billion obtained over 9 million purposes and was oversubscribed 147 instances. The success of IPO listings of Indian public sector enterprises (PSEs) isn’t a one-off, however a constant pattern over the previous few years. Within the final 7-8 years, almost 15 public sector firms have been listed on the Indian inventory exchanges, enabling them to not solely elevate much-needed funds but additionally generate large shareholder worth and retailer wealth.
Creating shareholder worth
Since 2017, earlier than BCCL, India has listed greater than 10 massive PSEs within the inventory market with core engineering, building, railways, protection and vitality corporations. They’ve constantly created worth for each particular person shareholders and the Authorities of India, which is the most important proprietor of PSE shares. Among the many corporations analyzed, the cumulative market capitalization elevated from Rs 1.4 billion on the time of itemizing to Rs 8.53 billion as of December 31, 2025, a rise of a whopping 513%.
The businesses analyzed are Cochin Shipyard, Mazagon Dock Shipyard, RITES Ltd., IRCON Worldwide, Rail Vikas Nigam Ltd., Indian Railway Finance Company, Indian Railway Catering and Tourism Company, RailTel Company, Housing and City Improvement Company, Hindustan Aeronautics Ltd (HAL), and Indian Renewable Power Improvement Authority.
Governments additionally profit considerably from service-related PSE listings, though the research excludes IPOs in providers sectors equivalent to banking and insurance coverage, the place efficiency is pushed by extra exterior components.
In abstract, the IPO route has not solely offered India’s PSEs with a robust mechanism to lift funds for productive use with out counting on the federal government’s budgetary course of, however has additionally delivered phenomenal returns to the federal government and its personal shareholders.
PSUs fund India’s strategic initiatives
Beforehand, public sector undertakings (PSUs) needed to depend on funds provisions from authorities ministries for capital expenditures and different expansions. This required intensive discussions with massive stakeholder teams and an extended cycle to appreciate funding. In immediately’s period of acknowledged agility in decision-making and execution of recent companies, the funds route can now not be thought of the one medium for procuring or receiving investments.
Not surprisingly, a reversal pattern has quietly begun to take form, with PSUs starting to fund crucial missions. For instance, in January 2025, the Ministry of Mines launched the Nationwide Crucial Minerals Mission (NCMM) to make sure long-term sustainable provide of crucial minerals and strengthen India’s crucial minerals worth chain. The cupboard has authorised an outlay of Rs 34,300 billion for NCMM, of which solely Rs 1,500 billion has been sourced from the federal government funds. Actually a ‘whole-of-government strategy’, over 50 per cent of the Mission’s expenditure (Rs 18,000 crore) is funded by PSUs throughout varied authorities ministries, together with KABIL (Ministry of Mines), Coal India Ltd. and Neyveli Lignite Company India Ltd. (Ministry of Coal), Metal Company of India and Nationwide Mineral Improvement Company (Ministry of Metal), and NTPC Mining Company. (Ministry of Energy), Oil India and ONGC Videsh Ltd (Oil and Pure Fuel). Very pertinently, the investments raised by these PSEs are being funneled into know-how and know-how getting used to scale back coal-based carbon emissions.
The above instance could now change into the norm in authorities funding for vital and strategic missions, the place PSEs are leveraged as strategic buyers, as seen within the NCMM.
Market as catalyst for PSU scrutiny and administration high quality
Markets are notoriously merciless and unforgiving, as they solely reward constant efficiency and shareholder worth creation. One of the vital spectacular parts of BCCL’s story is its journey from being perceived as a loss-prone PSU to a value-driven, strategically vital firm. Presently, BCCL accounts for almost 58.5% of India’s home coking coal manufacturing and is on the coronary heart of the metal and infrastructure worth chain. This strategic relevance was not misplaced on buyers. In an financial system centered on infrastructure enlargement, manufacturing progress, and self-reliance, BCCL is greater than only a coal producer. It represents vitality safety and industrial continuity.
The success of BCCL shouldn’t be seen as a one-time anomaly. The efficiency of different PSEs attests to broader modifications within the positioning and notion of PSE belongings. In the present day’s buyers are more and more discerning and favor PSEs for his or her readability of goal, operational power and dependable execution. PSEs are additionally utilizing the autonomy lately granted by authorities ministries and the transparency anticipated from market alternate reporting frameworks as a possibility to ship high quality of presidency, strategic planning, and velocity of execution. This new confidence is already shaping the following part of PSE market participation, with additional IPOs deliberate. The previous narrative that PSE IPOs are unattractive is over, and as a replacement is a robust new actuality. If the story is actual, the market will hear.
Professor S. Mahendra Dev is at present the Chairman of the EAC-PM Prime Minister’s Financial Advisory Council.
issued – January 28, 2026 12:55 AM IST
