Three more state-run power firms to join capital market this year

Mumbai, Jan 18 (UNI) Buoyed by the massive response given by the investors to the IPOs as issued by few of the state-run power firms in past, the Union Ministry of Power is planning to come with more such IPOs within next few months.

Making a formal announcement of the proposed IPO by PFC which opens on January 31 here today, the Union Power Secretary R V Shahi, hinted that at least three state-run power companies will join the bandwagon by the end of the first quarter of next financial year which begins in April this year.

The three state-run power firms that are tipped to join capital market in near future include Power Grid Corporation of India Ltd (PGCIL), Rural Electrification Corporation (REL) and North-Eastern Electric Power Corporation (NEEPCO).

Mr Shahi made it clear that the idea of giving exposure of capital market to the state-run power firms was not only to generate revenue to fuel their expansion plans, but also to sharpen their managerial growth.

He strongly advised the investors to purchase the shares of the PFC's IPO for several reasons which include the marginal NPA level of 0.23 per cent with it, lean and thin state-run unit which was making a profit of Rs 1,000 crore even though it had a staff-strength of only 300 and its being a Mini Ratna firm which was soon likley to get the status of Navaratna.

While the public issue launched by the NTPC Ltd was oversubscribed to 14 times, it was 10 times in the case of the issue launched by PTC.

The PFC's IPO, which opens on January 31, is likely to help it raise revenue of Rs 1,000 crore. The objects of the issue are to augment the company's capital base to meet the future capital requirements arising out of growth in the company's assets.

Currently we've got eight projects in our hands and we're likely to put a sum of Rs 12,000 crore in financing various power projects.

PFC has been financing only state-run power utility firms so far.

However now, now we'll be financing private power utility firms too through a consortium which has been formed by us for the purpose and which include LIC, 10 public sector banks excluding SBI. And the private power firms that are being financed by the consortium include Essar, Jindal and Lanco, PFC CMD Dr V K Garg said.

UNI