Gujarat- based Adani Power Ltd (ADL) has filed its DRHP with SEBI on 5th May, 2008, to enter the capital market with an IPO of 29.69 crore equity shares of Rs 10 each at a price to be decided at a later stage through the book building process. Out of the issue, 40 lakh equity shares are reserved for the employees of the company.
The issue will constitute 14.35% of the post issue paid up capital of the company.
The BRLMs to the issue are DSP Merrill Lynch, Enam Securities, SBI Capital Market, ICICI Securities, IDFC-SSKI, JM Financial Consultant , Kotak Mahindra and Morgan Stanley.
The company proposes to list its shares on BSE & NSE .
The object of the issue is to finance the construction and development of the company's power project at Mundra of 4,620 MW; for funding equity of subsidiaries engaged in the construction and development of 3 power projects totalling 5,280 MW (at Tiroda in Maharashtra of 1,980 MW, Dahej in Gujarat of 1,980 MW and third one at Kawai in Rajasthan of 1,320 MW).
The company intends to use the proceeds from the issue to part finance the above-mentioned project cost of Rs 43,139 crores. The company will use Rs 350 crores for land and site development; Rs 33,401 crore for building, civil works, engineering, procurement and construction; Rs 2,393 crore for transmission line/ railway line; Rs 790 crore for mining & coal supply; Rs 650.50 crore for preliminary & pre-operative expenses; interest during construction period of Rs 3,731 crore and contingency & margin money for working capital of Rs 1,823.50 crore.
Adani Power Ltd (ADL) is a power project development company. The company has six coal-fired thermal power projects under various stages of development or planning with a combined installed capacity of 9,900 MW, which the company intends to sell under a combination of long- term power purchase agreements to industrial and state owned consumers and on merchant basis. The group has already inked an agreement with the state electricity company - Gujarat Urja Vikas Nigam for power supply in first round -of bids and is now aiming to bag another contract in the second round of bidding.
The company is a part of the Adani Group. Adani Enterprises , the promoter of ADL, is the flagship company of the group, with total revenue of Rs 16,949.06 crore for FY07.
With the commissioning of the power projects, the Adani group will be vertically integrated in the power sector value chain through presence in related activities such as coal mining and trading, shipping, power generation, transmission and trading. Another Adam group company, Mundra Port and SEZ, owns and operates a large private sector commercial port and a SEZ at Mundra. The port is likely to handle close to 30 mmt of cargo during 2007-08. In addition, the group has operations in other industries, including commodities trading, real estate development, agro processing and logistics.
The company's 4,620 MW power project is being set up in the vicinity of Tata Power's UMPP of 4,000 MW . The company is already implementing the project through internal fund generation, debt and private placement of equity with London- based. 3i IIF GP which had announced last month investment of Rs 900 crore in Adani Power. 3i IIF GP is learnt to have acquired 9% stake in the company.