Govt may re-visit REC's initial public offer

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New Delhi, Feb 13 (UNI) The government today said it may re-visit the upcoming initial public offer (IPO) of state-run Rural Electrification Corporation (REC) on account of turbulent market conditions.

''I called the Chairman and Managing Director (of REC) to discuss the issue. I am concerned about the market conditions,'' Power Minister Sushilkumar Shinde told reporters.

REC Chairman A Lakhina is currently in the US for roadshows, he added.

The company, which has been accorded as Mini Ratna Grade-I status, and is scheduled to enter the capital market on February 19 with a public issue of 15,61,20,000 shares through a 100 per cent book building process.

The price band of shares of face value Rs 10 each has been fixed at Rs 90-105 per share. The issue closes February 22.

Recently the highly anticipated debut of Reliance Power disappointed the investors.

The shares slumped to Rs 372.50, 17.2 per cent down from the Rs 450 offering price. At its worst, the stock was down by 21 per cent.

Real estate developer Emaar MGF and health care services provider Wockhardt have withdrawn their respective issues following poor response.

While Wockhardt was subscribed only 19.5 per cent, the issue of Emaar garnered interest for only 43 per cent of the issue offered.

However, Power Secretary Anil Razdan said, the meltdown in the market would not have any bearing on the public offer of REC, which is expected to list on the bourses by third week of March.

Mr Razdan has maintained that the market needs companies like REC with a proven track record.

''At a troubled time like this, a strong and trusted player which has been in business since 1960s is needed,'' he said.

REC would offload 18.81 per cent equity through the issue. The company is third power PSU to bring out an IPO after PFC and PGCIL got listed last year.

UNI MP PBB DS1601

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