This ad will auto close in 10 seconds

First divestment of UPA; NHPC IPO price fixed at Rs 36

The govt has fixed a price of Rs 36 a share for the allotment of shares in the IPO of NHPC, thus raising Rs 6,048 crore.

New Delhi: The government has fixed a price of Rs 36 a share for the allotment of shares
in the Initial Public Offer of NHPC, thus raising Rs 6,048 crore, of which one-third would go to the Centre as disinvestment proceeds and the rest would remain with the hydro power utility PSU.

According to the Power Ministry sources, the Group of Ministers has decided to allot shares at the upper limit of the price band of Rs 30-36 a share.

The NHPC IPO, in which investors were asked to bid for shares in the price range of Rs 30-36 a share, closed on August 12 with a huge over-subscription of more than 23 times.

NHPC shares are likely to be listed on the bourses in the first week of September, sources said without divulging the exact date.

The shares on sale during the offer included the government`s five percent equity and 10 percent of fresh equity issued by the PSU.

The government would get Rs 2,016 crore while NHPC would retain the remaining Rs 4,032 crore. Post IPO, the government`s stake would come down to little over 86 percent in the power PSU.

With an installed capacity of 4,815 MW, NHPC has 11 projects under construction aggregating to a total capacity of 4,622 MW. The new projects are likely to be commissioned by 2012.

NHPC would use the IPO proceeds to part fund its ongoing investments in 11 projects. It also has plans to add 14,000 MW of power by 2020 for which it has either completed survey of projects or was in the process of surveying several others.

As part of its diversification plan, NHPC, along with the Madhya Pradesh government, would implement a 1,000 MW thermal power plant at Khandwa in that state. The PSU is also surveying projects in Bhutan, Myanmar and Nepal.

With the completion of NHPC`s IPO, the disinvestment programme of UPA-II has started on a high note as the IPO was over subscribed 23 times. This would give impetus to the planned stake sale in the Central PSUs by the government.

The previous tenure of UPA saw listing of three power sector PSUs -- PFC, PGCIL and REC.

Although no disinvestment target was fixed by the government in the Budget for 2009-10, Finance Minister Pranab Mukherjee had said, "The PSUs are the wealth of the nation, and part of this wealth should rest in the hands of the people."

"While retaining at least 51 percent government equity in our enterprises, I propose to encourage people`s participation in out disinvestment programme," he had said.

The Congress, which heads the UPA, had made clear its intent on going ahead with disinvestment saying if any of its "allies had any specific objection, we will deal with it".

Bureau Report

From Zee News

0 Comment - Join the Discussions