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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, 23 July 09
COAL IMPORTS SURGE; EXPORTS DOWN IN H1
China Trade Information reported that, China’s coal imports surged by 126.3 percent year-on-year in the first half of 2009, reaching 48.3 mill ...
Thursday, 23 July 09
SRI LANKA CALLS FOR COAL SUPPLY BIDS
Daily Mirro reported that, In a move to install the country’s first coal power plant, Sri Lanka has invited bids to supply 2.4 million metric ...
Thursday, 23 July 09
POWER INVESTORS TURN BACKS ON VIETNAMESE COAL IMPORTERS
VietNamNet Bridge reported that, Investors of power plants always seek foreign coal sources to import themselves, believing they can come by it chea ...
Wednesday, 22 July 09
BERAU COAL DRAWS LOCAL, CHINESE BIDS - SOURCES
* Indonesian coal firm draws local, Chinese bids-sources
* Deal could value Berau at more than $1 billion-sources
Reuters reported that, China' ...
Wednesday, 22 July 09
ONE TENDERS FOR 114,000 MT FOR NOV-JAN
Moroccan state-owned power utility Office National de l’Electricité (ONE) has launched a tender for three handymax shipments of coal fo ...
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- Ministry of Finance - Indonesia
- Mjunction Services Limited - India
- Banpu Public Company Limited - Thailand
- Thiess Contractors Indonesia
- The University of Queensland
- Electricity Generating Authority of Thailand
- Semirara Mining Corp, Philippines
- Malabar Cements Ltd - India
- Standard Chartered Bank - UAE
- Directorate General of MIneral and Coal - Indonesia
- SMC Global Power, Philippines
- Star Paper Mills Limited - India
- Power Finance Corporation Ltd., India
- Holcim Trading Pte Ltd - Singapore
- Bulk Trading Sa - Switzerland
- Videocon Industries ltd - India
- Krishnapatnam Port Company Ltd. - India
- Kideco Jaya Agung - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Sarangani Energy Corporation, Philippines
- Metalloyd Limited - United Kingdom
- Posco Energy - South Korea
- Timah Investasi Mineral - Indoneisa
- Mercator Lines Limited - India
- Ceylon Electricity Board - Sri Lanka
- Parry Sugars Refinery, India
- Africa Commodities Group - South Africa
- Carbofer General Trading SA - India
- Riau Bara Harum - Indonesia
- Siam City Cement - Thailand
- CNBM International Corporation - China
- Bhoruka Overseas - Indonesia
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- Coal and Oil Company - UAE
- Kepco SPC Power Corporation, Philippines
- Ministry of Transport, Egypt
- Mercuria Energy - Indonesia
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- ICICI Bank Limited - India
- Billiton Holdings Pty Ltd - Australia
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- Georgia Ports Authority, United States
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- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Coastal Gujarat Power Limited - India
- The Treasury - Australian Government
- Miang Besar Coal Terminal - Indonesia
- Vizag Seaport Private Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Sindya Power Generating Company Private Ltd
- Orica Mining Services - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Madhucon Powers Ltd - India
- Port Waratah Coal Services - Australia
- Interocean Group of Companies - India
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- VISA Power Limited - India
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- Aditya Birla Group - India
- Orica Australia Pty. Ltd.
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- Karbindo Abesyapradhi - Indoneisa
- Neyveli Lignite Corporation Ltd, - India
- Barasentosa Lestari - Indonesia
- Independent Power Producers Association of India
- Thai Mozambique Logistica
- Indian Energy Exchange, India
- LBH Netherlands Bv - Netherlands
- Tamil Nadu electricity Board
- IHS Mccloskey Coal Group - USA
- Energy Link Ltd, New Zealand
- Economic Council, Georgia
- Anglo American - United Kingdom
- Bukit Baiduri Energy - Indonesia
- Indogreen Group - Indonesia
- Binh Thuan Hamico - Vietnam
- Planning Commission, India
- Vijayanagar Sugar Pvt Ltd - India
- Edison Trading Spa - Italy
- Xindia Steels Limited - India
- Australian Coal Association
- International Coal Ventures Pvt Ltd - India
- Sinarmas Energy and Mining - Indonesia
- Medco Energi Mining Internasional
- London Commodity Brokers - England
- Formosa Plastics Group - Taiwan
- Siam City Cement PLC, Thailand
- Gujarat Electricity Regulatory Commission - India
- Eastern Coal Council - USA
- Minerals Council of Australia
- Price Waterhouse Coopers - Russia
- Dalmia Cement Bharat India
- Energy Development Corp, Philippines
- Borneo Indobara - Indonesia
- MS Steel International - UAE
- Sakthi Sugars Limited - India
- TeaM Sual Corporation - Philippines
- ASAPP Information Group - India
- Simpson Spence & Young - Indonesia
- Romanian Commodities Exchange
- PowerSource Philippines DevCo
- Kobexindo Tractors - Indoneisa
- TNB Fuel Sdn Bhd - Malaysia
- GVK Power & Infra Limited - India
- Merrill Lynch Commodities Europe
- Directorate Of Revenue Intelligence - India
- Bukit Makmur.PT - Indonesia
- New Zealand Coal & Carbon
- GAC Shipping (India) Pvt Ltd
- SN Aboitiz Power Inc, Philippines
- India Bulls Power Limited - India
- Goldman Sachs - Singapore
- Samtan Co., Ltd - South Korea
- Petron Corporation, Philippines
- Marubeni Corporation - India
- Sical Logistics Limited - India
- Manunggal Multi Energi - Indonesia
- Wilmar Investment Holdings
- Jindal Steel & Power Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Indika Energy - Indonesia
- CIMB Investment Bank - Malaysia
- Indo Tambangraya Megah - Indonesia
- San Jose City I Power Corp, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Makarim & Taira - Indonesia
- Agrawal Coal Company - India
- Lanco Infratech Ltd - India
- Antam Resourcindo - Indonesia
- Larsen & Toubro Limited - India
- Salva Resources Pvt Ltd - India
- Maheswari Brothers Coal Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Globalindo Alam Lestari - Indonesia
- Vedanta Resources Plc - India
- Wood Mackenzie - Singapore
- Cement Manufacturers Association - India
- Sojitz Corporation - Japan
- Maharashtra Electricity Regulatory Commission - India
- Therma Luzon, Inc, Philippines
- Pendopo Energi Batubara - Indonesia
- Ministry of Mines - Canada
- Global Business Power Corporation, Philippines
- Iligan Light & Power Inc, Philippines
- Bharathi Cement Corporation - India
- Chamber of Mines of South Africa
- Attock Cement Pakistan Limited
- Oldendorff Carriers - Singapore
- PTC India Limited - India
- Latin American Coal - Colombia
- Commonwealth Bank - Australia
- Parliament of New Zealand
- Intertek Mineral Services - Indonesia
- Ambuja Cements Ltd - India
- Kohat Cement Company Ltd. - Pakistan
- Bayan Resources Tbk. - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Rio Tinto Coal - Australia
- Indian Oil Corporation Limited
- Eastern Energy - Thailand
- Heidelberg Cement - Germany
- Kumho Petrochemical, South Korea
- Altura Mining Limited, Indonesia
- Kapuas Tunggal Persada - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Global Green Power PLC Corporation, Philippines
- IEA Clean Coal Centre - UK
- Meenaskhi Energy Private Limited - India
- Singapore Mercantile Exchange
- White Energy Company Limited
- Uttam Galva Steels Limited - India
- Australian Commodity Traders Exchange
- GMR Energy Limited - India
- European Bulk Services B.V. - Netherlands
- Offshore Bulk Terminal Pte Ltd, Singapore
- Global Coal Blending Company Limited - Australia
- Electricity Authority, New Zealand
- Toyota Tsusho Corporation, Japan
- Sree Jayajothi Cements Limited - India
- SMG Consultants - Indonesia
- Aboitiz Power Corporation - Philippines
- Jorong Barutama Greston.PT - Indonesia
- Gujarat Sidhee Cement - India
- Bangladesh Power Developement Board
- South Luzon Thermal Energy Corporation
- Grasim Industreis Ltd - India
- Bahari Cakrawala Sebuku - Indonesia
- Deloitte Consulting - India
- Alfred C Toepfer International GmbH - Germany
- Leighton Contractors Pty Ltd - Australia
- Trasteel International SA, Italy
- Bhushan Steel Limited - India
- Semirara Mining and Power Corporation, Philippines
- Central Java Power - Indonesia
- Ind-Barath Power Infra Limited - India
- Chettinad Cement Corporation Ltd - India
- Mintek Dendrill Indonesia
- Indonesian Coal Mining Association
- Savvy Resources Ltd - HongKong
- Rashtriya Ispat Nigam Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Renaissance Capital - South Africa
- Meralco Power Generation, Philippines
- McConnell Dowell - Australia
- Central Electricity Authority - India
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