BHEL to Invest ₹3,064 Crore in Coal India JV; Expands into Coal Gasification and Rail Maintenance
BHEL’s board has also approved the formation of a separate joint venture with Titagarh Rail Systems Limited
n a significant strategic move, Bharat Heavy Electricals Limited (BHEL) has announced an equity investment of up to ₹3,064.46 crore in a joint venture with Coal India Limited, marking its entry into the coal gasification-based chemicals business.
According to a regulatory filing, BHEL will invest the amount over a period of four years in the newly formed joint venture company, Bharat Coal Gasification and Chemicals Limited (BCGCL). The JV will have an equity structure of 49% held by BHEL and 51% by Coal India.
Focus on Coal-to-Chemicals Business
The primary objective of the JV is to establish a coal-to-ammonium nitrate plant with a production capacity of 2,000 tonnes per day. This initiative aligns with the government’s push towards coal gasification to reduce import dependence on chemicals and enhance value addition from domestic coal resources.
Second JV in Rail Segment
In another development, BHEL’s board has also approved the formation of a separate joint venture with Titagarh Rail Systems Limited. This JV will focus on comprehensive maintenance of Vande Bharat Sleeper trains, expanding BHEL’s footprint in the railway services segment.
The company noted that the JV agreement will be finalized after clearance from the Department of Investment and Public Asset Management (DIPAM), with any necessary modifications incorporated.
Market Reaction and Stock Performance
Following the announcements, BHEL’s stock witnessed selling pressure. Shares declined approximately 2.75% to ₹253 on the National Stock Exchange and ended the week over 4.60% lower.
On a year-to-date basis, the stock has fallen 13.19%, although it remains up by around 23% over the past 12 months, indicating longer-term investor confidence despite near-term volatility.
Government Stake Sale via OFS
Earlier in February, the Government of India initiated an Offer for Sale (OFS) to divest up to a 5% stake in BHEL. The offer includes:
- An initial 3% stake sale
- An option to sell an additional 2% in case of oversubscription
- Floor price fixed at ₹254 per share
Strong Financial Performance
BHEL has reported robust financial growth in the third quarter of FY 2025-26:
- Net Profit: ₹382.49 crore (up nearly 3x from ₹124.77 crore YoY)
- Revenue: ₹8,473.10 crore (up 16.4% YoY)
The growth was driven by steady execution across power and industrial segments, along with improved operating leverage and sequential momentum over Q2 FY26.
