Coal India Limited (CIL) has officially approved a Corporate Guarantee for its subsidiary, CIL Rajasthan Akshay Urja Limited (CRAUL). This guarantee covers debt obligations up to ₹3,160 Crores intended for funding the Capital Expenditure (CAPEX) of CRAUL’s 875 MW Solar PV Plant. The transaction is deemed to be at an Arm’s Length, given CIL’s majority 74% equity stake in the Joint Venture.
Corporate Guarantee for Subsidiary Funding
In a regulatory disclosure dated March 23, 2026, Coal India Limited (CIL) announced that its Board has sanctioned the provision of a guarantee for its subsidiary, CIL Rajasthan Akshay Urja Limited (CRAUL).
Transaction Details and Rationale
The guarantee is established to support the funding of the Capital Expenditure (CAPEX) required for CRAUL’s 875 MW Solar PV Plant.
- Guarantee Extent: A 100% Corporate Guarantee for debt funding up to ₹3,160 Crores.
- Impact: The potential liability for CIL, in case of CRAUL default, is limited to ₹3,160 Crores.
Joint Venture Structure of CRAUL
CRAUL operates as a Joint Venture between CIL and the Rajasthan Rajya Vidyut Utpadan Nigam Limited (RRVUNL), a Government of Rajasthan undertaking. The equity split is detailed as follows:
- CIL Stake: 74%
- RRVUNL Stake: 26%
CIL confirmed that the transaction adheres to the Arm’s Length principle, primarily due to CIL’s substantial 74% majority holding in the Joint Venture entity.
Source: BSE
