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