Saturday, August 15, 2009

JSW Energy to go public with Rs 3k-cr IPO

The Financial Express
Posted: 2009-08-15 23:59:15+05:30 IST, Updated: Aug 15, 2009 at 2359 hrs IST

Mumbai: JSW Energy, a part of Sajjan Jindal-led JSW Group, has filed its draft red herring prospectus (DRHP) with the Securities & Exchange Board of India (Sebi) to enter the capital market with an initial public offering (IPO) of equity shares of Rs 10 each for cash at a price (including a share premium) aggregating up to Rs 3,000 crore to fund the proposed capacity addition of 12,000mw. The issue, which is to be decided through a 100% book-building process, comprises a net issue of equity shares to the public and a reservation of equity shares for eligible employees.

The company's move comes close on the heels of oversubscription of state-run NHPC's IPO for 24 times and Adani Power's Rs 3,000-crore issue for over 21 times.

The company earlier had to defer its plans to go for an IPO to raise around $1 billion and dilute 10% stake owing to the slowdown and volatility in the stock markets.

According to a company release, at least 60% of the net issue will be allocated on a proportionate basis to qualified institutional buyers (QIBs), out of which 5% will be available for allocation on a proportionate basis only to mutual funds. The remainder will be available for allocation on a proportionate basis to all QIBs, including mutual funds. The company may consider participation by anchor investors in the QIB portion in accordance with applicable Sebi guidelines. Further, not less than 10% of the net issue will be available for allocation to non-institutional bidders on a proportionate basis and not less than 30% of the net issue will be available for allocation to retail individual bidders on a proportionate basis.

Currently, Raj West Power Ltd (RWPL), a subsidiary of JSW Energy Ltd, is executing a 1000mw lignite-based plant at Barmer, Rajasthan. Another subsidiary, JSW Energy (Ratnagiri) Ltd (JSWERL) is currently engaged in the implementation of a 1200mw coal-fired plant at Jaigad in the Ratnagiri district of Maharashtra. JSW Energy (Vijayanagar) Ltd (JSWEVL) is executing a 2 X 300mw power plant at Toranagallu, Bellary. JSWEL has also signed an MoU with the Gujarat government to implement a 1000mw plant in Junegarh district.

Further, the company proposes to execute power projects in West Bengal, Jharkhand and Andhra Pradesh. It is also actively pursuing plans to enter into the hydro sector in Himachal Pradesh and Sikkim. The company also plans to enter the transmission sector.

The company has been awarded the operation & maintenance contract of the 100mw captive power plant at JSW Steel. The O&M contracts for the captive plant and the 2 x 30mw power plant at SISCOL being executed by JSW Steel Ltd will also be entrusted to JSW Energy after declaration of their commercial operation.

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