Coal India, L&T among 20 firms bidding for ₹7,280 crore rare earth magnet scheme; shares in focus

Shares of Coal India Ltd (CIL) and Larsen & Toubro (L&T) are expected to hog the limelight on Friday, August 14, as the companies are among 20 entities that have submitted bids under the ₹7,280 crore scheme for setting up integrated Sintered NdFeB Rare Earth Permanent Magnet (REPM) manufacturing facilities in India, signalling strong industry interest in the government's push to build a domestic REPM manufacturing ecosystem.

The Ministry of Heavy Industries (MHI) received 20 bids through a global tender on the Central Public Procurement (CPP) portal for selection of manufacturers under the "Scheme to Promote Manufacturing of Sintered Rare Earth Permanent Magnet (REPM)".

The technical bids were opened on August 13 at MHI in the presence of the bidders.

Key details

The Union Cabinet, chaired by Prime Minister Narendra Modi, approved the "Scheme to Promote Manufacturing of Sintered Rare Earth Permanent Magnet (REPM)" on November 26, 2025, with a financial outlay of ₹7,280 crore. MHI issued the scheme notification on December 15, 2025.

The Request for Proposal (RFP) was floated on the CPP portal on March 20, 2026, and the pre-bid conference was held on April 7, 2026. The last date for receiving bids was August 12, 2026.

The first-of-its-kind scheme aims to establish a total capacity of 6,000 Metric Tons Per Annum (MTPA) of integrated Rare Earth Permanent Magnet manufacturing facilities in India, thereby enhancing self-reliance and positioning India as a key player in the global REPM market.

The scheme envisions allocating the total capacity to five beneficiaries through a global competitive bidding process. Each beneficiary will be allotted up to 1,200 MTPA of capacity.

The total duration of the scheme will be seven years from the date of award, including a two-year gestation period for setting up an integrated REPM manufacturing facility, and five years for incentive disbursement on the sale of REPM.

By building a complete value chain from NdPr (Neodymium-praseodymium) oxide to finished magnets in India, the scheme is expected to significantly reduce import dependence in this sector.

What are rare earth permanent magnets?

Rare earth permanent magnets are extremely powerful magnets made using rare earth elements, mainly neodymium (Nd), praseodymium (Pr), dysprosium (Dy), and terbium (Tb). They retain their magnetic field for many years without requiring an external power source, which is why they are called permanent magnets.

Where are they used?

Rare earth permanent magnets are widely used in products that require compact, powerful, and energy-efficient motors or generators.

They are a key component in electric vehicle traction motors, wind turbine generators, industrial robots, drones, elevators, and factory automation equipment. In consumer electronics, they are found in smartphones, wireless earbuds, speakers, and hard disk drives.

Rationale of the scheme

The initiative marks a significant step toward building a domestic rare earth permanent magnet (REPM) manufacturing ecosystem and improving India's competitiveness in global markets. By developing indigenous REPM production capacity, the scheme aims to strengthen supply chain security for domestic industries while supporting the country's net-zero emissions target by 2070.

The move also aligns with the government's broader vision of creating a technologically self-reliant, globally competitive, and sustainable industrial base under the Viksit Bharat 2047 roadmap.

Other details to know

Apart from Coal India Limited and Larsen & Toubro, the other bidders include 20 Microns, Attero Recycling, BaRupOn-IRP Consortium, Jay Fe Cylinders, Keystone Infra Pvt. Ltd., Huebox Interiors Pvt. Ltd. (JV), Lohum Magnets & Energy Solutions, Midwest Energy Limited-Midwest Advanced Materials (JV), N.A.N. Magnetech and NEO Performance Materials (Singapore) PTE. LTD.

The remaining bidders are Nexon Geochem Private Limited, PrNd Metal and Magnets, Proterial (India) Ltd, Prozeal Green Energy, Ramp Metals & Minerals, Renew Private Ltd, Shankaranarayana Constructions, Solpro Greentech and Starteck Finance.