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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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Wednesday, 05 August 09
SMALLER DRY BULK CARRIERS TO FARE BETTER UNTIL THE END OF 2009 - SHIPPING
Marcor Shipping reported that, Smaller ship types are expected to outtake larger ones in dry bulk trade for the period until the end of the year. Th ...
Wednesday, 05 August 09
PEOPLE'S MINING SHOULD BE REGULATED UNDER RPP MINERBA
The Indonesian Institute of Science (LIPI) has called on the government to include a specific provision for people’s mining in the draft govern ...
Tuesday, 04 August 09
SRI LANKA IS LOOKING FOR 650,000 TON OF COAL NEXT YEAR FOR ITS FIRST 900 MW POWER PLANT.
COALspot.com ( Sri Lanka) : Lanka Coal Company Limited was issued a tender on 23 July 2009 to purchase 650,000 +/- 20% MT Bituminous Coal per a ...
Monday, 03 August 09
ONE YEAR CHARTER RATES FOR SUPRAMAX WAS AT AROUND USD 18,500 - VISTAAR SINGAPORE
COALspot.com (Singapore) : The freight market was flat this week with hardly any change in the BDI.The cape was up by about 4 pct and closed at 5,38 ...
Saturday, 01 August 09
APGENCO SAYS BOUGHT 500,000T MALAYSIAN COAL
The Malaysian Insider reported that, Indian state utility Andhra Pradesh Power Generation Corporation Ltd (Apgenco) has bought 500,000 tonnes of Mal ...
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- Sojitz Corporation - Japan
- Gujarat Mineral Development Corp Ltd - India
- Kideco Jaya Agung - Indonesia
- CIMB Investment Bank - Malaysia
- Chettinad Cement Corporation Ltd - India
- Indonesian Coal Mining Association
- ICICI Bank Limited - India
- European Bulk Services B.V. - Netherlands
- Eastern Coal Council - USA
- PowerSource Philippines DevCo
- Meenaskhi Energy Private Limited - India
- Wood Mackenzie - Singapore
- Parry Sugars Refinery, India
- Iligan Light & Power Inc, Philippines
- LBH Netherlands Bv - Netherlands
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Krishnapatnam Port Company Ltd. - India
- Global Coal Blending Company Limited - Australia
- Madhucon Powers Ltd - India
- Barasentosa Lestari - Indonesia
- GMR Energy Limited - India
- Semirara Mining Corp, Philippines
- Karaikal Port Pvt Ltd - India
- Indian Oil Corporation Limited
- Oldendorff Carriers - Singapore
- Bangladesh Power Developement Board
- Deloitte Consulting - India
- Riau Bara Harum - Indonesia
- PTC India Limited - India
- Electricity Authority, New Zealand
- Simpson Spence & Young - Indonesia
- Independent Power Producers Association of India
- Cement Manufacturers Association - India
- Mercator Lines Limited - India
- Thai Mozambique Logistica
- Renaissance Capital - South Africa
- Samtan Co., Ltd - South Korea
- London Commodity Brokers - England
- SMC Global Power, Philippines
- Coastal Gujarat Power Limited - India
- Neyveli Lignite Corporation Ltd, - India
- GN Power Mariveles Coal Plant, Philippines
- Petrochimia International Co. Ltd.- Taiwan
- Posco Energy - South Korea
- PNOC Exploration Corporation - Philippines
- Australian Commodity Traders Exchange
- Interocean Group of Companies - India
- Rio Tinto Coal - Australia
- Trasteel International SA, Italy
- Tata Chemicals Ltd - India
- Electricity Generating Authority of Thailand
- Bhoruka Overseas - Indonesia
- Mintek Dendrill Indonesia
- TeaM Sual Corporation - Philippines
- Ministry of Mines - Canada
- Salva Resources Pvt Ltd - India
- Indogreen Group - Indonesia
- Merrill Lynch Commodities Europe
- India Bulls Power Limited - India
- Gujarat Electricity Regulatory Commission - India
- Leighton Contractors Pty Ltd - Australia
- CNBM International Corporation - China
- Petron Corporation, Philippines
- Essar Steel Hazira Ltd - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Maharashtra Electricity Regulatory Commission - India
- Videocon Industries ltd - India
- Siam City Cement PLC, Thailand
- Jindal Steel & Power Ltd - India
- Antam Resourcindo - Indonesia
- Globalindo Alam Lestari - Indonesia
- San Jose City I Power Corp, Philippines
- Thiess Contractors Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Timah Investasi Mineral - Indoneisa
- Sakthi Sugars Limited - India
- Eastern Energy - Thailand
- Pendopo Energi Batubara - Indonesia
- Heidelberg Cement - Germany
- Minerals Council of Australia
- Attock Cement Pakistan Limited
- Indo Tambangraya Megah - Indonesia
- Central Java Power - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Aboitiz Power Corporation - Philippines
- Orica Australia Pty. Ltd.
- Straits Asia Resources Limited - Singapore
- Cigading International Bulk Terminal - Indonesia
- Formosa Plastics Group - Taiwan
- GVK Power & Infra Limited - India
- Xindia Steels Limited - India
- IHS Mccloskey Coal Group - USA
- Aditya Birla Group - India
- South Luzon Thermal Energy Corporation
- Goldman Sachs - Singapore
- Indian Energy Exchange, India
- The Treasury - Australian Government
- New Zealand Coal & Carbon
- MS Steel International - UAE
- SMG Consultants - Indonesia
- Energy Link Ltd, New Zealand
- Anglo American - United Kingdom
- Bukit Baiduri Energy - Indonesia
- Standard Chartered Bank - UAE
- Holcim Trading Pte Ltd - Singapore
- Ambuja Cements Ltd - India
- Lanco Infratech Ltd - India
- Therma Luzon, Inc, Philippines
- Kalimantan Lumbung Energi - Indonesia
- Carbofer General Trading SA - India
- ASAPP Information Group - India
- Kobexindo Tractors - Indoneisa
- Billiton Holdings Pty Ltd - Australia
- Latin American Coal - Colombia
- AsiaOL BioFuels Corp., Philippines
- Mercuria Energy - Indonesia
- IEA Clean Coal Centre - UK
- Kartika Selabumi Mining - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Toyota Tsusho Corporation, Japan
- Star Paper Mills Limited - India
- Kapuas Tunggal Persada - Indonesia
- Georgia Ports Authority, United States
- Ceylon Electricity Board - Sri Lanka
- Bulk Trading Sa - Switzerland
- Africa Commodities Group - South Africa
- Price Waterhouse Coopers - Russia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Vedanta Resources Plc - India
- Makarim & Taira - Indonesia
- Parliament of New Zealand
- Kaltim Prima Coal - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Central Electricity Authority - India
- Port Waratah Coal Services - Australia
- Dalmia Cement Bharat India
- Altura Mining Limited, Indonesia
- Sarangani Energy Corporation, Philippines
- Intertek Mineral Services - Indonesia
- Bayan Resources Tbk. - Indonesia
- Romanian Commodities Exchange
- Mjunction Services Limited - India
- Agrawal Coal Company - India
- Grasim Industreis Ltd - India
- Borneo Indobara - Indonesia
- White Energy Company Limited
- GAC Shipping (India) Pvt Ltd
- Miang Besar Coal Terminal - Indonesia
- Global Green Power PLC Corporation, Philippines
- Orica Mining Services - Indonesia
- Commonwealth Bank - Australia
- McConnell Dowell - Australia
- Tamil Nadu electricity Board
- Semirara Mining and Power Corporation, Philippines
- Edison Trading Spa - Italy
- Planning Commission, India
- Larsen & Toubro Limited - India
- Metalloyd Limited - United Kingdom
- Power Finance Corporation Ltd., India
- VISA Power Limited - India
- Maheswari Brothers Coal Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Sical Logistics Limited - India
- Ministry of Transport, Egypt
- Medco Energi Mining Internasional
- Karbindo Abesyapradhi - Indoneisa
- Sinarmas Energy and Mining - Indonesia
- Coalindo Energy - Indonesia
- Bhushan Steel Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Jaiprakash Power Ventures ltd
- Meralco Power Generation, Philippines
- Chamber of Mines of South Africa
- Sindya Power Generating Company Private Ltd
- Vijayanagar Sugar Pvt Ltd - India
- Bhatia International Limited - India
- The State Trading Corporation of India Ltd
- Vizag Seaport Private Limited - India
- Binh Thuan Hamico - Vietnam
- Economic Council, Georgia
- Sree Jayajothi Cements Limited - India
- Energy Development Corp, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Rashtriya Ispat Nigam Limited - India
- The University of Queensland
- Directorate Of Revenue Intelligence - India
- Coal and Oil Company - UAE
- Malabar Cements Ltd - India
- Bukit Makmur.PT - Indonesia
- Siam City Cement - Thailand
- Baramulti Group, Indonesia
- Indika Energy - Indonesia
- Wilmar Investment Holdings
- Savvy Resources Ltd - HongKong
- Global Business Power Corporation, Philippines
- Kepco SPC Power Corporation, Philippines
- Ind-Barath Power Infra Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Kumho Petrochemical, South Korea
- Ministry of Finance - Indonesia
- International Coal Ventures Pvt Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- Singapore Mercantile Exchange
- Uttam Galva Steels Limited - India
- OPG Power Generation Pvt Ltd - India
- Bharathi Cement Corporation - India
- Pipit Mutiara Jaya. PT, Indonesia
- Australian Coal Association
- SN Aboitiz Power Inc, Philippines
- Marubeni Corporation - India
- Gujarat Sidhee Cement - India
- Banpu Public Company Limited - Thailand
- Manunggal Multi Energi - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Kohat Cement Company Ltd. - Pakistan
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