When coal turned gold: Former CIL chief P Bhattacharya's book traces journey of loss-making PSU, its turnaround

New Delhi: The story of Coal India Ltd’s (CIL) transformation from a hugely loss-making enterprise since its formation in the 70s into a profitable Maharatna PSU is told by its former chairman Partha Sarathi Bhattacharyya, who was among those who engineered the success. In When Coal Turned Gold: The Making of a Maharatna Company, Bhattacharyya, the then chairman of Coal India Ltd who spearheaded the initial public offering (IPO) in 2010, comes live with a first-hand account of what caused such resounding success. Having joined as a management trainee at the age of 26, he had seen the exciting transformation journey of CIL. According to the author, CIL’s story is fascinating in its own right to any discerning mind. “It is a home-grown story crafted by the management based on the application of tested principles of strategic and financial prudence combined with innovative thinking, not to mention the support from the government and the employees. Of course, the story left a lasting impression on investors worldwide,” he writes in the book, published by Penguin Random House India.

In the book’s foreword, former president Pranab Mukherjee says that as an MP and a junior minister in the 1970s, he witnessed the nationalisation of coal mines and later, as the minister of commerce, steel and mines, and finance, he realised its importance in the national scheme of things.

“However, it was as the finance minister of the country, when I was indirectly overseeing the initial public offering (IPO) of the CIL in 2010 that I watched its phenomenal transformation which this book has so brilliantly documented,” he writes. [caption id=“attachment_4191453” align=“alignleft” width=“380”]  Representational image. Reuters[/caption] Bhattacharyya says CIL and its subsidiaries have traditionally been known for all the wrong reasons. The cost to the nation of underestimating the role of its primary provider of energy security went largely unrecognised, he says and so it became imperative for the management to work concertedly to change the perception of the company while steering it towards meeting the entrusted role of ensuring energy security for the nation. “The pressure to project CIL for its value increased dramatically in October 2008 when the company was conferred the Navratna status. This came with a mandate from the government to get the company listed in the stock exchange within three years or face a review by the apex committee that carried the potential risk of the status being revoked,” he writes. The task was clearly uphill and its sheer size necessitated support from global investors for the public issue to succeed. With not much time left for his retirement, Bhattacharyya says he realised that getting CIL listed would perhaps be the greatest value addition that he could deliver to the company. “More importantly, I realised that it would be a disservice to not complete this task before I left, as that would expose the company to the potential risk of the Navratna status being revoked,” he says. On the resounding success of the IPO in October 2010, he says it was akin to a standing ovation by the investing community across the globe. “The IPO of  $3.5 billion, the largest witnessed by the Indian capital market, fetched a subscription of Rs 2,33,000 crore ($54 billion) and was oversubscribed more than 15 times. It broke most records and emerged as one of the top three IPOs of the world that year in terms of the funds committed,” the author says. It appreciated by 40 percent on the day of listing and over 60 percent in less than a year’s time to make CIL the most valuable company in the country for a few days in August 2011, he adds. “Having spearheaded the IPO from the company’s side, I felt the urge to bring the story forth from under the carpet. Hence this book,” Bhattacharyya says.