PowerGrid issue attracts $30 b overseas subscriptions

Power Grid Corporation of India’s public issue has attracted $30 billion (over Rs 1,20,000 crore) in overseas subscriptions, the issue itself getting subscribed 64 times overall. As margin money alone, the issue would bring in $3 billion in forex into the country.

“We received subscriptions worth over Rs 1,90,000 crore,” said Mr S. Subramanian, Head of Investment Banking, Enam Securities, one of the managers to the issue. “Institutional buyers subscribed 116 times, bringing in around $41 billion. Three-fourths of this institutional subscription came from overseas investors.”

The retail response to the PowerGrid issue was five times, and that of high net worth individual was 40 times. It would have raised Rs 2,900 crore at the upper end of the price band. As many as 57.39 crore shares were offered at a price band of Rs 44-52. As per data available on the NSE site, bids for 37 billion shares were received.

“We would think this is the largest issue ever, in particular the overseas response has been a bumper one,” said Mr Subramanian. This issue was particularly attractive to overseas pension funds, and the response was not unexpected, said Mr Arun Kejriwal, Director, Kejriwal Research Information Services.

With the huge power capacities that are coming up in the country, a transmission company like Power Grid has a straight forward, safe business, he said. “Overseas pension funds would definitely find a low risk investment attractive.”

Domestic pension funds and provident funds were also seen to be active, perhaps for the first time in the equities market, said Mr Subramanian. Overseas investors have also put in funds expecting a rupee appreciation, noted an investment banking official. Reliance Petroleum Ltd had fetched around $25 billion in subscriptions from the institutional category (including domestic and overseas), pointed out another investment banking official