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Indiabulls Power IPO subscribed 9 times on second day

Last Updated: Wednesday, October 14, 2009 - 23:52

Mumbai: The Rs 1,700-crore initial public
offer of Indiabulls Power, got subscribed nearly nine times
the on the second day of issue on Wednesday.

The issue received bids for over 246.82 crore shares,
compared with 27.86 crore shares on offer, thereby garnering
demand of 8.86 times according to the data on the National
Stock Exchange.

Pricing the shares in a range of Rs 40-45 the company
plans to mop up the amount from the primary market at the
upper end of the issue price.

Qualified institutional investors flocked the issue and
bid for over 16 times the shares on offer. High networth
individuals and retail investors subscribed to nearly
three times and 0.52 times the shares reserved for them, as
per NSE data.

"Currently Indiabulls Power has no operational power
plant. Its first power plant is expected to be operational
only by February 2012. All its future earnings are highly
sensitive to its ability to complete projects on time with all
the procurements in place," brokerage firm Sharekhan said.

The power unit of Indiabulls Realestate has come out with
an IPO of 39.07 crore equity shares which would result in a
equity dilution of 19.06 per cent.

Post the issue, the shareholding of promoter group would
come down to 59.18 per cent from the current 71.43 per cent.

The initial share sale of Indiabulls Power has attracted
five anchor investors who subscribed to 18 per cent of the
issue. The company raised over Rs 316.46 crore from these
strategic investors.

The existing shareholders in the company include LNM
India Internet Centures and FIM which holds 10.71 per cent and
17.86 per cent in the company. The issue would also dilute the
holding of NRI billionaire LN Mittal to 8.67 per cent.

Proceeds of the IPO would be utilised to part-finance the
construction and development of the 1,320-MW Amravati Power
Project Phase-I and the 1,335- MW Nashik Power Project, apart
from general corporate purposes.

Bureau Report

First Published: Wednesday, October 14, 2009 - 23:52
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