Power Grid Corporation trips ahead of listing of new shares

Power Grid Corporation of India lost 2.13% to Rs 99 at 12:38 IST on BSE, as shares allotted in its recently completed follow-on public offer will soon hit the market.

The new shares allotted to the public will be admitted to trading from Friday, 26 November 2010, as per reports.



Meanwhile, the BSE Sensex was up 145.48 points, or 0.74%, to 19,730.92.

On BSE, 9.37 lakh shares were traded in the counter compared with the average volume of 6.90 lakh shares in past one quarter.

The stock hit a high of Rs 101.30 and a low of Rs 98.75 so far during the day.

The company has an equity capital of Rs 4208.84 crore. Face value per share is Rs 10.

The follow-on public offer (FPO) of the state-run transmission firm Power Grid Corporation of India closed with 14.88 times subscription on 12 November 2010. The FPO garnered bids for 1252.96 crore shares, compared with 84.17 crore shares on offer.

The qualified institutional buyers (QIB) category was subscribed 18.52 times. Foreign institutional investors (FIIs) put in bids for 455.89 crore shares, compared with 41.91 crore shares reserved for the QIB category as a whole.

The non-institutional investors category, made up of corporates and high net worth individuals, was subscribed 28.86 times. The retail investors' category was subscribed 3.85 times, while the employees' category was 1.11 times subscribed.

The company priced the FPO at Rs 90, the top end of the Rs 85-90 per share price band. Retail investors and employees will get shares at a 5% discount.

The issue comprised of fresh issue of 42.08 crore shares and an offer for sale of equal number of shares by the President of India acting through the Ministry of Power, Government of India, which is 20% offer in total. The issue constituted 18.2% of the post issue paid-up capital of Power Grid Corporation of India. Post FPO, the government's holding in the company will decline to 69.40% from 86.36%.

The Power Grid FPO was part of the government's plan to raise Rs 40,000 crore in the fiscal year ending March 2011 from stake sale in state-run firms. Power Grid will use the funds raised from the FPO for part funding capital expenditure plan.

Power Grid Corporation of India's net profit surged 41.6% to Rs 651.40 crore on 25% rise in net sales to Rs 2126.63 crore in Q2 September 2010 over Q2 September 2009.