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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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- Kideco Jaya Agung - Indonesia
- Aboitiz Power Corporation - Philippines
- Straits Asia Resources Limited - Singapore
- Directorate Of Revenue Intelligence - India
- Economic Council, Georgia
- Riau Bara Harum - Indonesia
- Kobexindo Tractors - Indoneisa
- Australian Commodity Traders Exchange
- Africa Commodities Group - South Africa
- Orica Mining Services - Indonesia
- Ministry of Transport, Egypt
- Timah Investasi Mineral - Indoneisa
- Vedanta Resources Plc - India
- Kumho Petrochemical, South Korea
- TeaM Sual Corporation - Philippines
- Ind-Barath Power Infra Limited - India
- Bulk Trading Sa - Switzerland
- Electricity Authority, New Zealand
- New Zealand Coal & Carbon
- Interocean Group of Companies - India
- Madhucon Powers Ltd - India
- Rio Tinto Coal - Australia
- Pendopo Energi Batubara - Indonesia
- Toyota Tsusho Corporation, Japan
- Indogreen Group - Indonesia
- Singapore Mercantile Exchange
- MS Steel International - UAE
- Georgia Ports Authority, United States
- Offshore Bulk Terminal Pte Ltd, Singapore
- Antam Resourcindo - Indonesia
- Formosa Plastics Group - Taiwan
- Larsen & Toubro Limited - India
- Indonesian Coal Mining Association
- Coastal Gujarat Power Limited - India
- Siam City Cement PLC, Thailand
- Bayan Resources Tbk. - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- India Bulls Power Limited - India
- Mjunction Services Limited - India
- Intertek Mineral Services - Indonesia
- Wilmar Investment Holdings
- Tata Chemicals Ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Metalloyd Limited - United Kingdom
- Oldendorff Carriers - Singapore
- CNBM International Corporation - China
- ICICI Bank Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Energy Development Corp, Philippines
- Uttam Galva Steels Limited - India
- IEA Clean Coal Centre - UK
- Parry Sugars Refinery, India
- Jindal Steel & Power Ltd - India
- Indian Oil Corporation Limited
- Mercator Lines Limited - India
- Globalindo Alam Lestari - Indonesia
- Sarangani Energy Corporation, Philippines
- Semirara Mining Corp, Philippines
- GMR Energy Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Miang Besar Coal Terminal - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Leighton Contractors Pty Ltd - Australia
- Bhatia International Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Indika Energy - Indonesia
- The Treasury - Australian Government
- Maharashtra Electricity Regulatory Commission - India
- Petrochimia International Co. Ltd.- Taiwan
- Commonwealth Bank - Australia
- SMG Consultants - Indonesia
- Sakthi Sugars Limited - India
- Heidelberg Cement - Germany
- International Coal Ventures Pvt Ltd - India
- Posco Energy - South Korea
- Attock Cement Pakistan Limited
- Electricity Generating Authority of Thailand
- Bhushan Steel Limited - India
- Sree Jayajothi Cements Limited - India
- Trasteel International SA, Italy
- Anglo American - United Kingdom
- Bahari Cakrawala Sebuku - Indonesia
- GVK Power & Infra Limited - India
- Meralco Power Generation, Philippines
- Krishnapatnam Port Company Ltd. - India
- Savvy Resources Ltd - HongKong
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Chettinad Cement Corporation Ltd - India
- Sojitz Corporation - Japan
- PTC India Limited - India
- Cigading International Bulk Terminal - Indonesia
- Central Java Power - Indonesia
- Agrawal Coal Company - India
- Petron Corporation, Philippines
- Eastern Energy - Thailand
- Holcim Trading Pte Ltd - Singapore
- Manunggal Multi Energi - Indonesia
- Karaikal Port Pvt Ltd - India
- Mercuria Energy - Indonesia
- Xindia Steels Limited - India
- Planning Commission, India
- Salva Resources Pvt Ltd - India
- Therma Luzon, Inc, Philippines
- Latin American Coal - Colombia
- Samtan Co., Ltd - South Korea
- Baramulti Group, Indonesia
- Carbofer General Trading SA - India
- Kohat Cement Company Ltd. - Pakistan
- Bank of Tokyo Mitsubishi UFJ Ltd
- Alfred C Toepfer International GmbH - Germany
- Central Electricity Authority - India
- The University of Queensland
- Marubeni Corporation - India
- Bangladesh Power Developement Board
- Meenaskhi Energy Private Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Dalmia Cement Bharat India
- GAC Shipping (India) Pvt Ltd
- Coalindo Energy - Indonesia
- Port Waratah Coal Services - Australia
- Banpu Public Company Limited - Thailand
- SMC Global Power, Philippines
- Asmin Koalindo Tuhup - Indonesia
- OPG Power Generation Pvt Ltd - India
- Merrill Lynch Commodities Europe
- Ministry of Finance - Indonesia
- Independent Power Producers Association of India
- Directorate General of MIneral and Coal - Indonesia
- LBH Netherlands Bv - Netherlands
- Barasentosa Lestari - Indonesia
- Cement Manufacturers Association - India
- Jorong Barutama Greston.PT - Indonesia
- Global Coal Blending Company Limited - Australia
- European Bulk Services B.V. - Netherlands
- Price Waterhouse Coopers - Russia
- Gujarat Sidhee Cement - India
- Bharathi Cement Corporation - India
- Bukit Asam (Persero) Tbk - Indonesia
- Kartika Selabumi Mining - Indonesia
- Global Business Power Corporation, Philippines
- Altura Mining Limited, Indonesia
- Bhoruka Overseas - Indonesia
- Videocon Industries ltd - India
- Global Green Power PLC Corporation, Philippines
- ASAPP Information Group - India
- Indian Energy Exchange, India
- Ceylon Electricity Board - Sri Lanka
- Rashtriya Ispat Nigam Limited - India
- Edison Trading Spa - Italy
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- PowerSource Philippines DevCo
- Gujarat Electricity Regulatory Commission - India
- Indo Tambangraya Megah - Indonesia
- Thiess Contractors Indonesia
- South Luzon Thermal Energy Corporation
- Iligan Light & Power Inc, Philippines
- Chamber of Mines of South Africa
- Power Finance Corporation Ltd., India
- SN Aboitiz Power Inc, Philippines
- Kalimantan Lumbung Energi - Indonesia
- Siam City Cement - Thailand
- Deloitte Consulting - India
- Binh Thuan Hamico - Vietnam
- Renaissance Capital - South Africa
- Borneo Indobara - Indonesia
- Romanian Commodities Exchange
- Simpson Spence & Young - Indonesia
- London Commodity Brokers - England
- PetroVietnam Power Coal Import and Supply Company
- Lanco Infratech Ltd - India
- IHS Mccloskey Coal Group - USA
- Parliament of New Zealand
- Malabar Cements Ltd - India
- Sinarmas Energy and Mining - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Grasim Industreis Ltd - India
- Ministry of Mines - Canada
- Bukit Makmur.PT - Indonesia
- Sical Logistics Limited - India
- White Energy Company Limited
- Jaiprakash Power Ventures ltd
- Kaltim Prima Coal - Indonesia
- CIMB Investment Bank - Malaysia
- Wood Mackenzie - Singapore
- Kepco SPC Power Corporation, Philippines
- The State Trading Corporation of India Ltd
- McConnell Dowell - Australia
- Sindya Power Generating Company Private Ltd
- Star Paper Mills Limited - India
- San Jose City I Power Corp, Philippines
- Mintek Dendrill Indonesia
- Semirara Mining and Power Corporation, Philippines
- Eastern Coal Council - USA
- Ambuja Cements Ltd - India
- Maheswari Brothers Coal Limited - India
- Makarim & Taira - Indonesia
- Goldman Sachs - Singapore
- Billiton Holdings Pty Ltd - Australia
- Thai Mozambique Logistica
- Essar Steel Hazira Ltd - India
- Minerals Council of Australia
- Energy Link Ltd, New Zealand
- Medco Energi Mining Internasional
- Tamil Nadu electricity Board
- Coal and Oil Company - UAE
- Australian Coal Association
- Aditya Birla Group - India
- Vizag Seaport Private Limited - India
- Orica Australia Pty. Ltd.
- VISA Power Limited - India
- Bukit Baiduri Energy - Indonesia
- PNOC Exploration Corporation - Philippines
- Standard Chartered Bank - UAE
- Karbindo Abesyapradhi - Indoneisa
- Dr Ramakrishna Prasad Power Pvt Ltd - India
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