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Rel Power IPO to see 100% subscription in NII: Experts
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Wednesday, January 9, 2008 |
There is a mad rush for IPO funding now a days. Looking at recent big IPOs like Mundra Port, in which NII category subscribed 154 times of their reserved portion of shares and Reliance Petroleum's NII category got subscribed 58 times.
Reliance Power IPO
There has been huge rush for Reliance Power IPO after looking at its pre IPO response.
The IPO price band is between Rs 405-450 per share and lot size is 15 shares and in multiples thereof.
It will open on January 15 and close on January 18, 2008. The company is entering capital market with a public issue of 26 crore equity shares. Net issue to the public will be 22.8 crore shares. The company is going to raise more than Rs 10,000 crore from this IPO.
There are 2.28 crore shares available in the NII category, which is 10% of the total shares available in the IPO.
Comment:
This is the first IPO from Anil Dhirubhai Ambani Group and experts say that at least 100 times subscription is likely in NII category.
Moneycontrol learnt that the grey market premium for the Reliane Power IPO is around Rs 390-400.
Reliance Industries group companies have always delivered value in the past. Retail investors are pooling so that they can take leveraged bets.
If we assume that the IPO has subscribed 100 times in NII category and listing price at Rs 850 then the return for non institutional investors on investment is at 5.7%.
Source : MoneyControlLabels: per share and lot size, Rel Power IPO, Rel Power IPO to see 100% subscription in NII Experts, Reliance, Reliance Petrolium, Reliance Power IPO, Reliance Power IPO price band |
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posted by Unknown @ 11:24 PM  |
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Promoters seen offering more shares to institutions during IPOs
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Public issues, it seems, are not quite meant for the ‘public’. At a time when more and more retail investors are looking to hop on to the equity bandwagon, promoters have taken refuge in a decade-old regulation that allows them to dole out more shares to institutional bidders at the cost of retail ones.
And the sad part is that this is perfectly legal and only an initiative from the market regulator can create a more level-playing field for small investors.
According to capital market regulations, if promoters dilute more than 25% during an initial public offer (IPO), retail investors can be allotted 35% of the issue, while institutional category and HNI segment commands 50% and 15%, respectively.
However, promoters are nowadays diluting less than 25%, as this allows them to cap the retail portion at a maximum of 30%. The institutional portion in such cases go up by 10%. For small investors, this 5% difference can be substantial when the issue size is large.
Interestingly, this special clause — Rule 19(2)(b) — was introduced by the Securities and Exchange Board of India (Sebi) in 1999 for technology companies wherein promoters were allowed to dilute 10% if the issue size was more than Rs 100 crore.
This also meant that QIBs could be allotted 60%, while HNI and retail portion was capped at 10% and 30% respectively. While initially the special clause was applicable only to technology companies, it was subsequently extended to all sectors.
Meanwhile, two of the most high-profile issues in recent times — Reliance Power and Future Capital — that are about to hit the market shortly are also using this age-old clause (by diluting only around 10-12%) to allocate more to the institutional investors. For instance, Reliance Power, where 22.8 crore shares are on offer, retail investors can bid for only 6.84 crore shares.
While this trend has been on an upswing for quite some time now, the recent past has seen a near complete disappearance of issues where retail investors were offered 35% of the total issue. Industry watchers say this trend is killing the very concept of ‘public holding’ in a publicly listed company.
“The clause was valid when it was introduced”, says Prithvi Haldea of Prime Database, adding that now times have changed and there is an urgent need to revisit it. “May be increasing the Rs 100 crore limit to Rs 300 crore or Rs 500 crore could be a practical option as there is enough depth in the market to absorb such an issue,” he said.
The effect of this clause can be gauged from the shareholding pattern of some of the companies that turned ‘public’ last year.
The retail holding in Puravankara Projects is a lowly 0.8%. In the case of Motilal Oswal Securities and Omaxe, the retail stake is 3.43% and 3%, respectively. After the mega-sized public issue of DLF, retail investors have a 2.25% stake in the real estate major. In Vishal Retail, public stake is less than 5%.
However, merchant bankers, quite expectedly, are happy as it allows them to allocate more shares to institutional investors. “Promoters want more institutional investors as their shareholders”, said an investment banker on condition of anonymity. “Ultimately, it is the name of the foreign or domestic institutional entities that will attract more investors,” he added.
Some bankers are also of the view that promoters like to leave some room for a follow-on offering or a qualified institutional placement and so decide against a dilution of around 25%. However, bankers remain tight-lipped when questioned about the importance of the law in the current scenario.
Source : http://economictimes.indiatimes.comLabels: IPO, Promoters seen offering more shares to institutions during IPOs, Public issues, Rel Power IPO, Reliance, Reliance Power |
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posted by Unknown @ 11:19 PM |
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Reliance Power IPO opens Jan 15 - closes on Jan 18.Reliance Power will give the retail investors a five per cent price discount in its forthcoming IPO
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Wednesday, January 2, 2008 |
Reliance Power IPO opens Jan 15 and closes on Jan 18.Reliance Power will give the retail investors a five per cent price discount in its forthcoming IPO, through which the company will raise up to Rs 11,700 crore.
Based on the upper limit of the price band, the company would raise Rs 11,700 crore with the sale of 26 crore shares in the public offer.
This would be the biggest ever IPO in India, surpassing the public issue of realty giant DLF that raised about Rs 9,000 crore last year.
This is believed to be the first to offer a discount in the IPO price for retail investors. Rating agency Crisil assigned an above average 4-on-5 rating to the proposed initial public offer of Reliance Power.Labels: biggest ever IPO in India, Rating agency Crisil, Reliance, Reliance Power IPO, Reliance Power IPO Allotment status, Reliance Power IPO opens Jan 15 and closes on Jan 18, Reliance Power Limited IPO |
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posted by Unknown @ 7:57 AM |
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Reliance Power IPO Allotment Status : Reliance Power IPO Allotment chances
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Tuesday, January 1, 2008 |
Reliance Power IPO Allotment status:
Reliance Power IPO is no use applying as there is going to huge response to reliance power ipo.
Reliance Power IPO Response is going be to huge among retail investors going by present ipo trend.
So dont expect Great profits from Reliance Power ipo as allotment chances in reliance power ipo is going to be so bad.
Reliance Power IPO Allotment Status and Listing information
The total value of Reliance Power IPO, according to market expectations, would be more as the proceeds would be used to fund a total of 12 power projects with a total installed capacity of 24,200 MW, generating speculation that it could be even bigger than the largest IPO in the country. The investment envisaged for the projects is nearly Rs 1 lakh crore.
Reliance Power proposes to come out with an IPO of 160 crore shares of face value Rs 2, at a premium to be fixed later.
Source : Birlaa.comLabels: IPO, Reliance, Reliance Power IPO, Reliance Power IPO Allotment status, Reliance Power Limited IPO |
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posted by Unknown @ 6:55 AM |
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Reliance Power IPO : Reliance Power Limited IPO Review
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Reliance Power Limited has recently filed its Draft Red Herring Prospectus (DRHP) with SEBI.
Reliance Power Limited IPO which would be one of the biggest IPO in Indian stock markets which will issue 130 crore equity shares of Rs 2 each at a price to be decided later.
The net issue to the public would be 114 crore equity shares after the promotors contribution of 16 crore equity shares.Reliance Power IPO will constitute 11.5% of the post issue paid-up capital of the company and the net issue will constitute 10.1% of the post issue paid-up capital of the company.
Reliance Power Limited IPO Review:
Company Overiew : Reliance Power Limited is part of the Reliance ADA group and is established to develop, construct and operate power projects domestically and internationally.Reliance Power is currently developing 12 medium and large sized power projects with a combined planned installed capacity of 24,200 MW, one of the largest portfolios of power generation assets under development in India.
Competetive Strengths of Reliance Power Limited
1. One of the largest potfolios of Power Generation Projects under Development in India.
2. Portfolio of Power Projects that diverse in Geographic Location, Fuel-type, Fuel source and off-take.
3. Strategically Located Power Projects.
4. Part of the Reliance ADA Group.
Projects Currently handled by Reliance Power Limited
• Rosa Phase I, a 600 MW coal-fired project in Uttar Pradesh scheduled to be commissioned in March 2010.
• Rosa Phase II, a 600 MW expansion of Rosa Phase I which is scheduled to be commissioned in September 2010.
• Butibori, a 300 MW coal-fired project scheduled to be commissioned in June 2010.
• Sasan 3,960MW UMPPs promoted and awarded by the Government of India is expected to be the largest pithead coal-fired power project at a single location in India,scheduled to be commissioned by April 2016.
• Shahapur, a 4,000 MW coal-fired(1,200 MW) and combined cycle gas-fired (2,800 MW) project in Shahapur, scheduled to be commissioned in March 2011.
• Urthing Sobla (400 MW), a run-of-the-river hydroelectric project, located on the Daulinganga River in Uttarakhand scheduled to be commissioned in March 2014.
Five other projects—the gas-fired Dadri project (7,480 MW), the coal-fired MP Power project (3,960 MW) and three run-of-the-river hydroelectric projects, Siyom (1,000 MW), Tato II (700 MW) and Kalai II (1,200 MW).
Major Points of the Reliance Power IPO
Reliance Energy which holds major stake in Reliance Power will offload 11.5% stake from Reliance Power Limited. With regard to the listing the company has got principal approval from the Reliance Energy Shareholders.
Face Value Change : In an recent news, the SEBI has not agreed to the DRHP presented by the Reliance Power for its IPO and so the company has to alter some points to meet the SEBI instructions. As per the market news, SEBI has not agreed on the IPO offer price at Rs. 2 and the company is now considering to change the face value of the shares offered to Rs. 10, for this the Reliance Power IPO issue date may be delayed for at least a month according to the sources.
Reliance Power IPO Date : Subscription of the issue is expected to start around the 2nd week of January 2008.Subscription of the Reliance Power IPO will be high as the Retail and the Institutional investors are showing tremendous confidence in this issue, even before the subscription of the Reliance Power IPO started, Grey market premium is quoting around Rs. 60.
More information related to the Reliance Power IPO will be updated soon.
Source : bsensedaily.comLabels: Reliance, Reliance Power IPO, Reliance Power Limited IPO Review |
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posted by Unknown @ 6:52 AM |
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