Jindal Power public issue in April end

Jindal Power (JPL), a wholly owned subsidiary of Jindal Steel and Power (JSPL), will hit the market with its initial public offering (IPO) by end-April.

The company, which had filed its draft red herring prospectus with the Securities and Exchange Board of India on December 29, aims to raise Rs 7,200 crore to fund various thermal power projects and meet other corporate requirements.

Sushil Maroo, deputy managing director, JPL did not comment.

However, a source confirmed that the company had finalised plans to come out with the IPO by the end of April.

JSPL will dilute 10% equity in JPL to raise Rs 7,200 crore, thereby valuing the business at Rs 72,000 crore, more than its own market capitalisation of Rs 66,000 crore.

JPL currently operates 1,000 mw power capacity at Tamnar in Raigarh district of Chhattisgarh, set up at an investment of Rs 4,338 crore. It is expanding capacity at Tamnar by setting up a 2,400 mw thermal power plant at an estimated cost of Rs 13,410 crore.

Going by the source, the company has already placed the order for supply, erection and commissioning of 4X600 mw boiler turbine generation package on Bharat Heavy Electricals (Bhel). “The existing 1000 mw power plant was set up with four turbine generators of 250 mw each, also supplied by Bhel.”

What’s more, the power subsidiary has signed a memorandum of understanding with the Jharkhand government for setting up a 2,640 mw thermal power plant and also plans to set up a 6,100 mw hydro power project in Arunachal Pradesh in a joint venture with Hydro Power Development Corporation of Arunachal Pradesh Ltd.

JM Financial Consultants, Enam Securities, Deutsche Equities India, Goldman Sachs (India) Securities, ICICI Securities, UBS Securities India and SBI Capital Markets are the book running lead managers to the issue. Motilal Oswal Investment Advisors Pvt Ltd is the co-book running lead manager.