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Monday, 27 July 09
ADANI POWER'S $625 MILLION IPO TO GENERATE HOT DEMAND
 WSJ reported that, Adani Power, the electricity generating unit of India's Adani Enterprises Ltd., is set raise up to US$625 million in what analysts say will be a hotly contested initial public offering.
Gearing up to list next month after stalling when markets were hit early last year, Adani Power's revived IPO will be the largest in India since Reliance Power's $2.9 billion IPO in January 2008.
While Adani Power has yet to have up-and-running power plants - the first phase of a 330-megawatt plant in Mundra, in the western Indian province of Gujarat, comes on line this month - and its IPO pricing isn't cheap, analysts say the offering is a good buy.
Controlled by the Adani Group, which is known for delivering projects on time, Adani Power also has the advantage of being a power producer in a country where electricity shortages are common.
"Adani Power is a well-thought-through venture with a focus on high-power deficit states (in India), 25-year power purchase agreements with a 72% off-take, and 15 years of coal supplies guaranteed," Bhargav Buddhadev, a power sector analyst with Noble Research, said in a recent note.
The 301.65-million share offer, which has an indicative price range of 90 rupees-100 rupees ($2.07) , raising $625 million at the top end, opens for subscriptions from retail and institutional investors Tuesday and ends Friday.
The company is 81.5% owned by family controlled Adani Enterprise Ltd., a unit of the ports-to-property conglomerate Adani Group, and 8.5% by UK private equity firm 3i Group Plc.
After the IPO, Adani Power will be 70.2% owned by Adani Enterprises, 7.4% by 3i and 1.2% by Capital Trade & Investment Pvt Ltd, another unit of the Adani Group.
The share sale comes as India faces acute energy shortages that have increased over the years despite a growing economy.
Between April and May this year, India had a peak energy deficit, which calculates the difference between energy demand and supply, of 12.3%. In the western part of the country, where Adani Power is setting up four power plants, the deficit was 15.9%, the highest for any region.
Two of the new power plants, in Mundra and Dahej, are in Gujurat; the Kawai plant is in Rajasthan, and the Tiroda one in Maharashtra.
The four have "attractive economics with a payback to IPO equity investors in two and a half years if the project goes to plan," Mr. Buddhadev added, referring to the fact that the company has already signed 25-year contracts with the state-owned electricity boards in those places.
Adani Power has signed those 25-year pacts for 72% of the power its plants are set to produce at tariffs ranging between 2.64 rupees and 2.94 rupees per unit. The remaining 28% will be sold to individual merchants at spot rates, which are currently hovering around 8-9 rupees per KWh. The production price is around 2 rupeess per KWh.
"Adani Power has close to 30% of its capacity set to be sold on a merchant basis, which will give higher returns," said Deven Choksey, the managing director of Mumbai-based brokerage K.R.Choksey Shares & Securities, who recommends the stock to long term investors.
Independent investment advisor and National Stock Exchange member S.P. Tulsian, who sees the 100 rupees top end of the price band as good value said the company can theoretically make annual returns of 35% on its shareholder funds, given "assured returns available to power projects and with (a relatively higher debt-to-equity) gearing of about 4:1."
CLSA's Abhishek Tyagi predicts that the company will record earnings per share of 3 rupees, 5.8 rupees and 10.7 rupees for the financial years ending March 31, 2010, 2011 and 2012 respectively.
This translates to a price to earnings ratio of 33.3 times, 17.2 times and 9.3 times forward earnings respectively, using the upper end of the indicative IPO price range of 90-100 rupees.
But there are risks, partly related to the fact that the company's plants have yet to start production. At a 100 rupees IPO price, Adani Power trades at 3.8 times price-to-book compared with a lower 3.1 times for the sector, according to Noble Research's Buddhadev.
The Chinese equipment to be used by Adani Power has historically been less reliable and not as efficient as locally made turbines, and the company's dependence on coal from Indonesia exposes the company to regulatory and commercial risks, Mr. Buddhadev said.
Adani Group also has licenses to operate just two of the three mines it needs coal from in Indonesia.
Still, the Adani Group's ability to finish large projects on time will stand Adani Power in good stead, analysts said. Adani Power has four thermal power plants under various stages of development and planning with a combined planned capacity of 9900MW. The company plans to utilize the share sale proceeds to part fund the set up of power units in Mundra and Tiroda.
"While other power companies take between four to five years to implement a project of this size, the fact that Adani Power will only take three years, works to the advantage of the investor," Mr. Choksey said.
Source: WSJ India
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Tuesday, 11 August 09
INDONESIA'S COAL EXPORTS TO INDIA WILL BE EXEMPTED FROM DUTIES STARTING JANUARY 1, 2013 - BERITA SORE
Berita sore reported that, ASEAN is scheduled to sign a long-awaited Free Trade Agreement (FTA) with India in Bangkok on Thursday aimed at boosting ...
Tuesday, 11 August 09
ZAMBIAN COAL BUYERS CONTINUE IMPORTING COAL FROM ZIMBABWE
Lusaka Times reported that, Coal mining companies have bemoaned the lack of market for their produce as prospective buyers continue importing the co ...
Monday, 10 August 09
NOMINAL HIKE IN COAL PRICES SOON - MEDIA
The hindu business reported that, a marginal hike in coal prices is in the offing. "I will be soon approaching the Prime Minister on the matter ...
Monday, 10 August 09
MANGALAM CEMENT PLACES ORDER FOR CAPTIVE POWER PLANT
Steel Guru reported that, Mangalam Cement Ltd has announced that the company on August 6th 2009 finalized order for Captive Thermal Power Plant of 1 ...
Monday, 10 August 09
VIET NAM COAL EXPORTS HIT 13.5 MILLION TONNES
VietNamNet Bridge reported that, Viet Nam exported more than 13.5 million tonnes of coal in the first seven months of this year, equal to the same p ...
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- Iligan Light & Power Inc, Philippines
- AsiaOL BioFuels Corp., Philippines
- GVK Power & Infra Limited - India
- Sarangani Energy Corporation, Philippines
- SN Aboitiz Power Inc, Philippines
- Makarim & Taira - Indonesia
- Bangladesh Power Developement Board
- Australian Commodity Traders Exchange
- Merrill Lynch Commodities Europe
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Aditya Birla Group - India
- Karaikal Port Pvt Ltd - India
- Electricity Generating Authority of Thailand
- Manunggal Multi Energi - Indonesia
- Siam City Cement - Thailand
- Mercuria Energy - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- European Bulk Services B.V. - Netherlands
- Attock Cement Pakistan Limited
- Posco Energy - South Korea
- Bukit Asam (Persero) Tbk - Indonesia
- Bulk Trading Sa - Switzerland
- Billiton Holdings Pty Ltd - Australia
- Ministry of Mines - Canada
- Kohat Cement Company Ltd. - Pakistan
- Xindia Steels Limited - India
- Latin American Coal - Colombia
- Global Business Power Corporation, Philippines
- Energy Development Corp, Philippines
- Mercator Lines Limited - India
- Australian Coal Association
- Independent Power Producers Association of India
- Romanian Commodities Exchange
- Ministry of Transport, Egypt
- Antam Resourcindo - Indonesia
- Essar Steel Hazira Ltd - India
- South Luzon Thermal Energy Corporation
- Goldman Sachs - Singapore
- Sree Jayajothi Cements Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- SMC Global Power, Philippines
- Rio Tinto Coal - Australia
- Bhushan Steel Limited - India
- Lanco Infratech Ltd - India
- Mjunction Services Limited - India
- TeaM Sual Corporation - Philippines
- Malabar Cements Ltd - India
- Georgia Ports Authority, United States
- Toyota Tsusho Corporation, Japan
- Karbindo Abesyapradhi - Indoneisa
- Orica Australia Pty. Ltd.
- Eastern Coal Council - USA
- Heidelberg Cement - Germany
- GAC Shipping (India) Pvt Ltd
- Ministry of Finance - Indonesia
- Tamil Nadu electricity Board
- Renaissance Capital - South Africa
- White Energy Company Limited
- Wood Mackenzie - Singapore
- SMG Consultants - Indonesia
- Therma Luzon, Inc, Philippines
- Coalindo Energy - Indonesia
- Global Coal Blending Company Limited - Australia
- LBH Netherlands Bv - Netherlands
- Bukit Baiduri Energy - Indonesia
- Port Waratah Coal Services - Australia
- Maharashtra Electricity Regulatory Commission - India
- Mintek Dendrill Indonesia
- Leighton Contractors Pty Ltd - Australia
- International Coal Ventures Pvt Ltd - India
- Jindal Steel & Power Ltd - India
- Bhatia International Limited - India
- Globalindo Alam Lestari - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Larsen & Toubro Limited - India
- Directorate Of Revenue Intelligence - India
- Chamber of Mines of South Africa
- Kapuas Tunggal Persada - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Africa Commodities Group - South Africa
- Wilmar Investment Holdings
- Neyveli Lignite Corporation Ltd, - India
- Sakthi Sugars Limited - India
- Bharathi Cement Corporation - India
- Indonesian Coal Mining Association
- Gujarat Sidhee Cement - India
- Thai Mozambique Logistica
- GMR Energy Limited - India
- Madhucon Powers Ltd - India
- Bhoruka Overseas - Indonesia
- Semirara Mining Corp, Philippines
- Meralco Power Generation, Philippines
- Eastern Energy - Thailand
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- The Treasury - Australian Government
- Global Green Power PLC Corporation, Philippines
- Sindya Power Generating Company Private Ltd
- Gujarat Electricity Regulatory Commission - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Bukit Makmur.PT - Indonesia
- Sojitz Corporation - Japan
- Oldendorff Carriers - Singapore
- Orica Mining Services - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Central Electricity Authority - India
- Kumho Petrochemical, South Korea
- Ceylon Electricity Board - Sri Lanka
- Kobexindo Tractors - Indoneisa
- Singapore Mercantile Exchange
- OPG Power Generation Pvt Ltd - India
- India Bulls Power Limited - India
- Metalloyd Limited - United Kingdom
- Barasentosa Lestari - Indonesia
- Kepco SPC Power Corporation, Philippines
- Siam City Cement PLC, Thailand
- Coastal Gujarat Power Limited - India
- McConnell Dowell - Australia
- Star Paper Mills Limited - India
- Samtan Co., Ltd - South Korea
- Cement Manufacturers Association - India
- PowerSource Philippines DevCo
- Trasteel International SA, Italy
- Edison Trading Spa - Italy
- Altura Mining Limited, Indonesia
- ICICI Bank Limited - India
- Jaiprakash Power Ventures ltd
- Pipit Mutiara Jaya. PT, Indonesia
- Economic Council, Georgia
- Tata Chemicals Ltd - India
- Standard Chartered Bank - UAE
- Parry Sugars Refinery, India
- Rashtriya Ispat Nigam Limited - India
- Deloitte Consulting - India
- Dalmia Cement Bharat India
- PTC India Limited - India
- Grasim Industreis Ltd - India
- Coal and Oil Company - UAE
- Electricity Authority, New Zealand
- Vizag Seaport Private Limited - India
- Thiess Contractors Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Borneo Indobara - Indonesia
- Central Java Power - Indonesia
- Pendopo Energi Batubara - Indonesia
- Indo Tambangraya Megah - Indonesia
- Videocon Industries ltd - India
- Savvy Resources Ltd - HongKong
- Bayan Resources Tbk. - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Krishnapatnam Port Company Ltd. - India
- London Commodity Brokers - England
- Binh Thuan Hamico - Vietnam
- IEA Clean Coal Centre - UK
- IHS Mccloskey Coal Group - USA
- San Jose City I Power Corp, Philippines
- Timah Investasi Mineral - Indoneisa
- Parliament of New Zealand
- Carbofer General Trading SA - India
- Alfred C Toepfer International GmbH - Germany
- Interocean Group of Companies - India
- Ambuja Cements Ltd - India
- Sinarmas Energy and Mining - Indonesia
- Agrawal Coal Company - India
- Indian Oil Corporation Limited
- Kalimantan Lumbung Energi - Indonesia
- Kideco Jaya Agung - Indonesia
- CNBM International Corporation - China
- Minerals Council of Australia
- CIMB Investment Bank - Malaysia
- Bahari Cakrawala Sebuku - Indonesia
- Indika Energy - Indonesia
- Planning Commission, India
- Power Finance Corporation Ltd., India
- Kartika Selabumi Mining - Indonesia
- Chettinad Cement Corporation Ltd - India
- Indian Energy Exchange, India
- Uttam Galva Steels Limited - India
- Vedanta Resources Plc - India
- Sical Logistics Limited - India
- The State Trading Corporation of India Ltd
- Miang Besar Coal Terminal - Indonesia
- Formosa Plastics Group - Taiwan
- PNOC Exploration Corporation - Philippines
- Indogreen Group - Indonesia
- Cigading International Bulk Terminal - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Aboitiz Power Corporation - Philippines
- The University of Queensland
- Anglo American - United Kingdom
- Bank of Tokyo Mitsubishi UFJ Ltd
- Baramulti Group, Indonesia
- Holcim Trading Pte Ltd - Singapore
- Medco Energi Mining Internasional
- Price Waterhouse Coopers - Russia
- Petrochimia International Co. Ltd.- Taiwan
- MS Steel International - UAE
- Salva Resources Pvt Ltd - India
- Semirara Mining and Power Corporation, Philippines
- Commonwealth Bank - Australia
- Energy Link Ltd, New Zealand
- Ind-Barath Power Infra Limited - India
- Petron Corporation, Philippines
- Kaltim Prima Coal - Indonesia
- VISA Power Limited - India
- Marubeni Corporation - India
- Intertek Mineral Services - Indonesia
- Simpson Spence & Young - Indonesia
- ASAPP Information Group - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Maheswari Brothers Coal Limited - India
- Meenaskhi Energy Private Limited - India
- Riau Bara Harum - Indonesia
- New Zealand Coal & Carbon
- Straits Asia Resources Limited - Singapore
- Banpu Public Company Limited - Thailand
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