Power IPOs to flood street in coming weeks

Adani Power Ltd., a power project development company promoted by Adani Enterprises Ltd., plans to tap the capital markets on July 28 with an initial public offering (IPO) of 301,652,031 equity shares of Rs 10 each at a price to be decided through the book-building process. The IPO closes on July 31. The price range is likely to be Rs100-110. At this range, the company will be raising anywhere between Rs33bn to Rs37bn. The Adani Power IPO announcement lifted the shares of Adani Enterprises, the holding company of the diversified Adani group.

Indiabulls Real Estate said its wholly-owned power subsidiary Indiabulls Power (formerly Sophia Power Co.) filed a draft red herring prospectus with the capital market regulator SEBI for an initial public offer (IPO). According to media reports, Indiabulls Power is planning to raise Rs15bn through the IPO to fund its future projects. However, the company did not provide any further details related to the draft offer.

Sterlite Industries, part of the London-listed Vedanta Resources, on July 15 raised US$1.5bn (about Rs72bn at current exchange rates) through an American Depository Shares (ADS) issue. The Anil Agarwal-controlled company said that the funds raised would be used to part-finance its power generation plans and other planned capex programmes. Sterlite’s power plans are being built through wholly-owned subsidiary Sterlite Energy, which is building two commercial power plants - a 2,400 MW plant at Jharsuguda in Orissa and another 1,980 MW plant in Punjab, at a total investment of about Rs150bn (about US$3.1bn).

Public sector hydel power generation company NHPC is likely to bring out its much-awaited IPO next month after twice postponing the same in the last two years. SBI Caps, Enam Financial and Kotak Mahindra are book runners and lead managers of the issue, for which Karvy will be the registrar. "If everything goes well, the IPO is likely to be in the first week of August, tentatively August 7," said NHPC CMD S.K. Garg. The proposed issue involves NHPC infusing 10% fresh equity through this public offer to raise Rs16.8bn while the Government will divest its 5% stake in the company.

The duration and pricing of the issue would be decided after July 27 when the company would file its Draft Red Herring Prospectus (DRHP) with the registrar of companies (RoC). NHPC had earlier filed the Draft Red Herring Prospectus (DRHP) in April 2007, but it was turned down by SEBI, as the company did not have the required strength of independent directors on its board then. Later, the company re-filed on August 6, 2008, but could not launch the IPO due to poor market conditions. IPOs are also due from JSW Steel and Jaiprakash Power Ventures.