NHPC’s IPO on 7 August; to divest 5 per cent

Public sector hydropower giant National Hydroelectric Power Corporation is ready to launch its initial public offer on 7 August, nearly nine months after its original launch was deferred due to poor market sentiment.

The shares will be offered to the public in the price band of Rs30-36 a share, with the aim of raising up to Rs6,048 crore, company officials announced on Tuesday. This will be the first stake sale by the current government since it came to power, and the first PSU offering in 17 months after the Rural Electrification Corporation went public in February 2008, raising over Rs1,600 crore.

The issue will close on 11 August. The company would sell 168 crore shares, comprising a five per cent stake, and infuse of 10 per cent fresh equity. At the top end of the price band, the offerings could fetch Rs6,048 crore. The government's equity would come down to a little over 86 per cent after the float. This equity could have a valuation of Rs44,000 crore.

The NHPC offering was originally planned for October 2008, but abandoned with the Sensex crashing amid the global financial crisis. Indian markets have since recovered, and while IPOs of NHPC and Oil India Ltd are scheduled for the next two months, the finance ministry in the next three weeks will finalise a list of other PSUs that would hit the markets in the coming fiscal.

Plans 10 new projects
Meanwhile, NHPC is planning to become a 10,000-MW company by the end of the eleventh five-year plan (2007-2012), as it will commission 10 new projects to add nearly 4,500 MW of generation capacity, newspersons visiting its plant at Chamera in Himachal Pradesh were informed.

The company plans a capital expenditure of Rs21,600 crore till 2012, of which Rs16,391 crore is the debt component and the remaining would come through internal accruals.