Date 23 July 2009
Adani Power Ltd IPO - Opens on July 28
About the IPO: Adani Power Ltd. (APL), a flagship company of Adani Group, with total revenues of Rs 19600 crores, is entering the capital markets with an initial public offering of 301,652,031 equity shares of Face value of Rs 10 each for cash at a price to be decided through a 100% book-building process. The issue would constitute 13.84% of the post-issue paid-up equity share capital of the company.
Company: Adani Power Ltd Sector: Power IPO Dates: Opens on July 28 – Closes on July 31 Price Band: Rs.90-100 per share IPO Size: Rs. 2,714.87 crores – Rs. 3,016.52 crores Minimum shares: 65 shares per application Proposed Listing: NSE and BSE
About the Company: Adani Power Ltd. (APL) was incorporated in 1996 and it became a public company in April 2007. The object of the company is to develop operate and maintain power projects in India . APL was originally incorporated by Mr. Gautam S. Adani and Mr. Rajesh S. Adani, together with their relatives. Due to restructuring the entire shareholding was transferred to Mundra Port and SEZ and subsequently to Adani Enterprises limited.
APL's Power projects are located in the western region of India . The company is thus well positioned to serve a significant demand in this power deficit region of western India . The group has also ventured into power generation and power transmission through projects being set up Adani Power Ltd. The Adani group seeks to be a vertically integrated enterprise in the power sector through APL and its other businesses.
Usage of Funds raised: APL is currently implementing a 4,620 mw coal-fired plant at Mundra, Gujarat and 1980 mw at Tiroda, Maharashtra with a combined installed capacity of 6,600 MW for which the land, water and coal linkages have been tied up. The company has tied up with State utilities for about 70 per cent of the 6,600-MW to be produced at the two projects and the balance would be traded on merchant basis and under MPP model .
The company has a planned outlay of around Rs 28,400 crore s, of which it has already tied up for nearly Rs 22,700 crores . The net proceeds from the issue would be utilised to part finance the construction and development of the above two projetcs.
About the Power Sector: The Government of India has identified the power sector as a key sector of focus to promote sustained industrial growth and has undertaken multiple reforms to make it more attractive to private sector investment. Energy deficit varies widely across India , with the western region having the highest peak energy shortages at 15.9% followed by the northern region. The power industry has not grown sufficiently to meet demand and the economy still faces an acute shortage of power. The Government has estimated the total investment potential of the sector at Rs 9,000 billions for a period up to 2011. This represents a significant opportunity for capacity expansion and growth for power generation companies, both in the public and the private sector.
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