REC mops up Rs 43,000 cr via IPO

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New Delhi, Feb 22 (UNI) Despite a highly volatile market the state-run Rural Electrification Corporation Limited (REC) today said it has mopped up over Rs 43,000 crores as its initial public offer (IPO) got subscribed by 27.3 times by 1700 hours on the last day of its issue.

The issue has received 4.26 billion bids against 15.61 crore shares on offer in the price band Rs 90-105 per share.

The Issue constitutes approximately 18.18 per cent of the fully diluted post-issue capital of REC. IL&FS Investsmart Securities Limited, ICICI Securities Ltd and SBI Capital Markets Limited are the Book Running Lead Managers for the Issue.

The Company proposes to utilise the net proceeds from the fresh issue to augment its capital base to improve its borrowing capacity in order to support the future growth in its assets.

The IPO came as the government mandated REC and Power Finance Corporation (PFC) to mobilise funds to ensure that viable projects do not suffer for want of funds as the government has drawn up plans to bridge the demand-supply yawning gap in power sector.

The government's Eleventh Plan (2008-2012) anticipates a substantial increase in the country's power capacity. The Ministry of Power's data shows that India's power generation system, as on March 31, 2007, had a total installed capacity of 132,330 MW and an additional 78,577MW are required to meet the projected demand during the plan period. Thus, the overall fund requirement by 2012 for the sector has been estimated at a whopping Rs 10,316,000 million.

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