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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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Thursday, 06 August 09
CHINA JULY COAL IMPORTS AT 9.5 MLN T, DEMAND FIRM
* Coal imports at key ports in July 2.8 times year-ago levels
* July coal imports down nearly 40 percent from June
* China still buying overseas c ...
Thursday, 06 August 09
CASES FILED AGAINST ESSAR ALGOMA OVER TERMINATED COAL SHIPMENTS
Steel Guru reported that, It is reported that units of International Coal Group Inc and Arch Coal Inc have filed federal lawsuits in the same court ...
Thursday, 06 August 09
COMPULSORY MINE RECLAMATION PROPOSED FOR A MINING'S LIFETIME
Tambang reported that, A data from the Forestry Ministry showed that almost 65 percent of mining activities operated under contract of work, c ...
Thursday, 06 August 09
MINING PERMITS FOR THOSE COMMITTED TO SMELTER DEVELOPMENT ONLY
Tambang reported tht, Concrete and tangible endeavors are key to guarantee the attainment of added value from mining sector. The Indonesian Ministry ...
Thursday, 06 August 09
PRESS RELEASE - CZECH COAL CONTESTS THE J&T AND IPO MERGER
Prague, 3 August 2009 - The Czech Coal Group filed today objections to the proposed merger of the J&T Group and International Power Opatovice (I ...
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- Bhatia International Limited - India
- AsiaOL BioFuels Corp., Philippines
- Agrawal Coal Company - India
- Australian Coal Association
- Grasim Industreis Ltd - India
- Kepco SPC Power Corporation, Philippines
- Binh Thuan Hamico - Vietnam
- Coal and Oil Company - UAE
- Bangladesh Power Developement Board
- Singapore Mercantile Exchange
- Neyveli Lignite Corporation Ltd, - India
- OPG Power Generation Pvt Ltd - India
- Trasteel International SA, Italy
- Bukit Asam (Persero) Tbk - Indonesia
- Vedanta Resources Plc - India
- Riau Bara Harum - Indonesia
- Vizag Seaport Private Limited - India
- Goldman Sachs - Singapore
- Karaikal Port Pvt Ltd - India
- Independent Power Producers Association of India
- Simpson Spence & Young - Indonesia
- Siam City Cement PLC, Thailand
- Offshore Bulk Terminal Pte Ltd, Singapore
- Port Waratah Coal Services - Australia
- Chettinad Cement Corporation Ltd - India
- Central Java Power - Indonesia
- ICICI Bank Limited - India
- Kapuas Tunggal Persada - Indonesia
- Antam Resourcindo - Indonesia
- Semirara Mining and Power Corporation, Philippines
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- SN Aboitiz Power Inc, Philippines
- Tamil Nadu electricity Board
- Timah Investasi Mineral - Indoneisa
- Merrill Lynch Commodities Europe
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- Central Electricity Authority - India
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- Dr Ramakrishna Prasad Power Pvt Ltd - India
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- Wilmar Investment Holdings
- Latin American Coal - Colombia
- Sindya Power Generating Company Private Ltd
- Bharathi Cement Corporation - India
- Bukit Baiduri Energy - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Economic Council, Georgia
- Bhushan Steel Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Kumho Petrochemical, South Korea
- Banpu Public Company Limited - Thailand
- Petron Corporation, Philippines
- Meenaskhi Energy Private Limited - India
- Ministry of Finance - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Essar Steel Hazira Ltd - India
- SMC Global Power, Philippines
- Kobexindo Tractors - Indoneisa
- Barasentosa Lestari - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Heidelberg Cement - Germany
- Sree Jayajothi Cements Limited - India
- Parry Sugars Refinery, India
- Orica Mining Services - Indonesia
- Parliament of New Zealand
- Intertek Mineral Services - Indonesia
- Interocean Group of Companies - India
- Minerals Council of Australia
- Ministry of Mines - Canada
- Wood Mackenzie - Singapore
- Tata Chemicals Ltd - India
- Eastern Coal Council - USA
- SMG Consultants - Indonesia
- The Treasury - Australian Government
- Global Business Power Corporation, Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Salva Resources Pvt Ltd - India
- Electricity Generating Authority of Thailand
- Kohat Cement Company Ltd. - Pakistan
- Australian Commodity Traders Exchange
- The State Trading Corporation of India Ltd
- Oldendorff Carriers - Singapore
- Samtan Co., Ltd - South Korea
- Gujarat Electricity Regulatory Commission - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Anglo American - United Kingdom
- Energy Link Ltd, New Zealand
- European Bulk Services B.V. - Netherlands
- Maharashtra Electricity Regulatory Commission - India
- TeaM Sual Corporation - Philippines
- Renaissance Capital - South Africa
- Savvy Resources Ltd - HongKong
- Marubeni Corporation - India
- San Jose City I Power Corp, Philippines
- Bhoruka Overseas - Indonesia
- Indian Oil Corporation Limited
- CNBM International Corporation - China
- Maheswari Brothers Coal Limited - India
- Altura Mining Limited, Indonesia
- Jindal Steel & Power Ltd - India
- Miang Besar Coal Terminal - Indonesia
- Baramulti Group, Indonesia
- International Coal Ventures Pvt Ltd - India
- White Energy Company Limited
- Dalmia Cement Bharat India
- Indian Energy Exchange, India
- Indika Energy - Indonesia
- London Commodity Brokers - England
- Rashtriya Ispat Nigam Limited - India
- Larsen & Toubro Limited - India
- The University of Queensland
- Sinarmas Energy and Mining - Indonesia
- Formosa Plastics Group - Taiwan
- Sojitz Corporation - Japan
- Holcim Trading Pte Ltd - Singapore
- Jorong Barutama Greston.PT - Indonesia
- Iligan Light & Power Inc, Philippines
- Mercator Lines Limited - India
- Bukit Makmur.PT - Indonesia
- VISA Power Limited - India
- Indo Tambangraya Megah - Indonesia
- PTC India Limited - India
- Energy Development Corp, Philippines
- Directorate Of Revenue Intelligence - India
- GAC Shipping (India) Pvt Ltd
- Manunggal Multi Energi - Indonesia
- Krishnapatnam Port Company Ltd. - India
- MS Steel International - UAE
- Globalindo Alam Lestari - Indonesia
- Gujarat Sidhee Cement - India
- Kartika Selabumi Mining - Indonesia
- Thai Mozambique Logistica
- Siam City Cement - Thailand
- Xindia Steels Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Chamber of Mines of South Africa
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- PowerSource Philippines DevCo
- Carbofer General Trading SA - India
- Thiess Contractors Indonesia
- Metalloyd Limited - United Kingdom
- Directorate General of MIneral and Coal - Indonesia
- Medco Energi Mining Internasional
- Indonesian Coal Mining Association
- Standard Chartered Bank - UAE
- Bayan Resources Tbk. - Indonesia
- LBH Netherlands Bv - Netherlands
- Africa Commodities Group - South Africa
- GVK Power & Infra Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Jaiprakash Power Ventures ltd
- Edison Trading Spa - Italy
- Mjunction Services Limited - India
- Toyota Tsusho Corporation, Japan
- Kideco Jaya Agung - Indonesia
- Madhucon Powers Ltd - India
- IHS Mccloskey Coal Group - USA
- CIMB Investment Bank - Malaysia
- Eastern Energy - Thailand
- South Luzon Thermal Energy Corporation
- Uttam Galva Steels Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Mercuria Energy - Indonesia
- IEA Clean Coal Centre - UK
- GMR Energy Limited - India
- Indogreen Group - Indonesia
- McConnell Dowell - Australia
- PNOC Exploration Corporation - Philippines
- Star Paper Mills Limited - India
- Cement Manufacturers Association - India
- Billiton Holdings Pty Ltd - Australia
- Aditya Birla Group - India
- Commonwealth Bank - Australia
- Ind-Barath Power Infra Limited - India
- Mintek Dendrill Indonesia
- Romanian Commodities Exchange
- Bulk Trading Sa - Switzerland
- PetroVietnam Power Coal Import and Supply Company
- Global Coal Blending Company Limited - Australia
- Attock Cement Pakistan Limited
- Makarim & Taira - Indonesia
- Global Green Power PLC Corporation, Philippines
- Semirara Mining Corp, Philippines
- Borneo Indobara - Indonesia
- Aboitiz Power Corporation - Philippines
- Kalimantan Lumbung Energi - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Ministry of Transport, Egypt
- ASAPP Information Group - India
- Therma Luzon, Inc, Philippines
- Planning Commission, India
- Power Finance Corporation Ltd., India
- Gujarat Mineral Development Corp Ltd - India
- Videocon Industries ltd - India
- Electricity Authority, New Zealand
- Ceylon Electricity Board - Sri Lanka
- Rio Tinto Coal - Australia
- India Bulls Power Limited - India
- Ambuja Cements Ltd - India
- Lanco Infratech Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Price Waterhouse Coopers - Russia
- Straits Asia Resources Limited - Singapore
- GN Power Mariveles Coal Plant, Philippines
- Coalindo Energy - Indonesia
- New Zealand Coal & Carbon
- Sakthi Sugars Limited - India
- Malabar Cements Ltd - India
- Asmin Koalindo Tuhup - Indonesia
- Deloitte Consulting - India
- Pendopo Energi Batubara - Indonesia
- Sical Logistics Limited - India
- Cigading International Bulk Terminal - Indonesia
- Orica Australia Pty. Ltd.
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