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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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Sunday, 09 August 09
TNEB ENNORE PORT CALLS TO TRIPLE COAL OUTPUT
World Shipping News reported that, the Tamil Nadu Electricity Board (TNEB) has asked Ennore Port Ltd (EPL) to increase the port’s installed ca ...
Saturday, 08 August 09
TWO / THREE YEAR CHARTER RATES FOR SUPRAMAX IS AROUND US$ 15,000-16,000 PER DAY - CAPT. REDDY
COALspot.com (Singapore): The dry bulk market tumbled this week and the BDI dropped by almost 17% and closed at 2,772 points.
The cape and panam ...
Saturday, 08 August 09
SULTAN MINING SIGNS P8-BILLION, 10-YEAR COAL-SUPPLY CONTRACT WITH KEPCO POWER CORP.
COAL developer Sultan Mining and Energy Development Corp. (SMEDC) reported on Thursday that its subsidiary MG Mining and Energy Corp. signed an P8-b ...
Friday, 07 August 09
NEED TO HIKE DOMESTIC PRICES - COAL INDIA
WSJ reported that, The chairman of Coal India Ltd., the country's biggest coal producer, Friday said there was a need to hike domestic coal prices ...
Friday, 07 August 09
INDONESIA COAL NEWS UPDATES
PTBA to Produce 13 Million Tons
President Director of Tambang Batubara Bukit Asam (PTBA), Sukrisno has estimated coal production of the company th ...
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- IEA Clean Coal Centre - UK
- Mintek Dendrill Indonesia
- Aboitiz Power Corporation - Philippines
- GAC Shipping (India) Pvt Ltd
- Bulk Trading Sa - Switzerland
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Deloitte Consulting - India
- Thiess Contractors Indonesia
- Marubeni Corporation - India
- Grasim Industreis Ltd - India
- Eastern Coal Council - USA
- Alfred C Toepfer International GmbH - Germany
- Port Waratah Coal Services - Australia
- Wilmar Investment Holdings
- Lanco Infratech Ltd - India
- SMG Consultants - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Ambuja Cements Ltd - India
- Karaikal Port Pvt Ltd - India
- CIMB Investment Bank - Malaysia
- Riau Bara Harum - Indonesia
- Timah Investasi Mineral - Indoneisa
- Gujarat Sidhee Cement - India
- Attock Cement Pakistan Limited
- Carbofer General Trading SA - India
- Miang Besar Coal Terminal - Indonesia
- Baramulti Group, Indonesia
- Commonwealth Bank - Australia
- Star Paper Mills Limited - India
- Ministry of Finance - Indonesia
- Orica Mining Services - Indonesia
- Singapore Mercantile Exchange
- Kapuas Tunggal Persada - Indonesia
- Altura Mining Limited, Indonesia
- Bayan Resources Tbk. - Indonesia
- Sarangani Energy Corporation, Philippines
- Oldendorff Carriers - Singapore
- Australian Commodity Traders Exchange
- Coalindo Energy - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Mjunction Services Limited - India
- Georgia Ports Authority, United States
- Banpu Public Company Limited - Thailand
- Minerals Council of Australia
- Indian Energy Exchange, India
- PTC India Limited - India
- Indika Energy - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Binh Thuan Hamico - Vietnam
- Larsen & Toubro Limited - India
- Semirara Mining Corp, Philippines
- Australian Coal Association
- Petron Corporation, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Formosa Plastics Group - Taiwan
- Bhushan Steel Limited - India
- Africa Commodities Group - South Africa
- Rashtriya Ispat Nigam Limited - India
- Tamil Nadu electricity Board
- Directorate Of Revenue Intelligence - India
- Toyota Tsusho Corporation, Japan
- Cigading International Bulk Terminal - Indonesia
- Rio Tinto Coal - Australia
- Indogreen Group - Indonesia
- Pendopo Energi Batubara - Indonesia
- Samtan Co., Ltd - South Korea
- Sakthi Sugars Limited - India
- Thai Mozambique Logistica
- Global Coal Blending Company Limited - Australia
- Indian Oil Corporation Limited
- Orica Australia Pty. Ltd.
- Makarim & Taira - Indonesia
- Eastern Energy - Thailand
- Directorate General of MIneral and Coal - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- SN Aboitiz Power Inc, Philippines
- Barasentosa Lestari - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Manunggal Multi Energi - Indonesia
- Maheswari Brothers Coal Limited - India
- The State Trading Corporation of India Ltd
- GVK Power & Infra Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Kobexindo Tractors - Indoneisa
- OPG Power Generation Pvt Ltd - India
- Globalindo Alam Lestari - Indonesia
- Ministry of Mines - Canada
- Electricity Generating Authority of Thailand
- Ceylon Electricity Board - Sri Lanka
- Renaissance Capital - South Africa
- Intertek Mineral Services - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Sindya Power Generating Company Private Ltd
- Global Green Power PLC Corporation, Philippines
- Independent Power Producers Association of India
- Bukit Asam (Persero) Tbk - Indonesia
- CNBM International Corporation - China
- Aditya Birla Group - India
- Chettinad Cement Corporation Ltd - India
- Kartika Selabumi Mining - Indonesia
- Parry Sugars Refinery, India
- Asmin Koalindo Tuhup - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Bhoruka Overseas - Indonesia
- New Zealand Coal & Carbon
- Kumho Petrochemical, South Korea
- Kepco SPC Power Corporation, Philippines
- Coastal Gujarat Power Limited - India
- GMR Energy Limited - India
- Meralco Power Generation, Philippines
- London Commodity Brokers - England
- Price Waterhouse Coopers - Russia
- Chamber of Mines of South Africa
- Sical Logistics Limited - India
- International Coal Ventures Pvt Ltd - India
- Trasteel International SA, Italy
- Kalimantan Lumbung Energi - Indonesia
- Simpson Spence & Young - Indonesia
- Global Business Power Corporation, Philippines
- Goldman Sachs - Singapore
- Straits Asia Resources Limited - Singapore
- Kohat Cement Company Ltd. - Pakistan
- Coal and Oil Company - UAE
- Wood Mackenzie - Singapore
- Edison Trading Spa - Italy
- Kaltim Prima Coal - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- San Jose City I Power Corp, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Mercuria Energy - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Malabar Cements Ltd - India
- Essar Steel Hazira Ltd - India
- Interocean Group of Companies - India
- VISA Power Limited - India
- ICICI Bank Limited - India
- Latin American Coal - Colombia
- Bangladesh Power Developement Board
- Therma Luzon, Inc, Philippines
- Mercator Lines Limited - India
- PNOC Exploration Corporation - Philippines
- Heidelberg Cement - Germany
- McConnell Dowell - Australia
- Gujarat Mineral Development Corp Ltd - India
- Cement Manufacturers Association - India
- Bhatia International Limited - India
- Siam City Cement - Thailand
- Bukit Baiduri Energy - Indonesia
- Salva Resources Pvt Ltd - India
- Bukit Makmur.PT - Indonesia
- Romanian Commodities Exchange
- Central Java Power - Indonesia
- Jindal Steel & Power Ltd - India
- Central Electricity Authority - India
- Vedanta Resources Plc - India
- Indo Tambangraya Megah - Indonesia
- Posco Energy - South Korea
- The University of Queensland
- Vizag Seaport Private Limited - India
- PowerSource Philippines DevCo
- Energy Development Corp, Philippines
- Standard Chartered Bank - UAE
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- Gujarat Electricity Regulatory Commission - India
- Madhucon Powers Ltd - India
- Jaiprakash Power Ventures ltd
- Videocon Industries ltd - India
- AsiaOL BioFuels Corp., Philippines
- Petrochimia International Co. Ltd.- Taiwan
- Tata Chemicals Ltd - India
- Meenaskhi Energy Private Limited - India
- Ministry of Transport, Egypt
- Savvy Resources Ltd - HongKong
- GN Power Mariveles Coal Plant, Philippines
- Borneo Indobara - Indonesia
- White Energy Company Limited
- Sojitz Corporation - Japan
- Anglo American - United Kingdom
- Power Finance Corporation Ltd., India
- MS Steel International - UAE
- Medco Energi Mining Internasional
- Kideco Jaya Agung - Indonesia
- Semirara Mining and Power Corporation, Philippines
- IHS Mccloskey Coal Group - USA
- Antam Resourcindo - Indonesia
- Xindia Steels Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Uttam Galva Steels Limited - India
- Siam City Cement PLC, Thailand
- Maharashtra Electricity Regulatory Commission - India
- SMC Global Power, Philippines
- Ind-Barath Power Infra Limited - India
- Sree Jayajothi Cements Limited - India
- Iligan Light & Power Inc, Philippines
- Electricity Authority, New Zealand
- Parliament of New Zealand
- Metalloyd Limited - United Kingdom
- India Bulls Power Limited - India
- Planning Commission, India
- TeaM Sual Corporation - Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Karbindo Abesyapradhi - Indoneisa
- Neyveli Lignite Corporation Ltd, - India
- PetroVietnam Power Coal Import and Supply Company
- The Treasury - Australian Government
- Bharathi Cement Corporation - India
- European Bulk Services B.V. - Netherlands
- Energy Link Ltd, New Zealand
- Merrill Lynch Commodities Europe
- LBH Netherlands Bv - Netherlands
- Dalmia Cement Bharat India
- Indonesian Coal Mining Association
- Agrawal Coal Company - India
- Economic Council, Georgia
- South Luzon Thermal Energy Corporation
- ASAPP Information Group - India
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