Power Grid Corporation of India ends with 94% premium

Power Grid Corporation of India settled at Rs 100.65 on BSE, a premium of 93.55% over the IPO price of Rs 52. The stock debuted at Rs 85, a premium of 63.46% over the IPO price. It had hit a high of Rs 109.40 and a low of Rs 85. On BSE, 9.97 crore shares of the scrip were traded. At the current price of Rs 100.65, the PE multiple works out to 38.71, based on FY 2007 EPS of Rs 2.60. The company had fixed the IPO price at the top end of the Rs 44-Rs 52 price band. The Power Grid Corporation of India IPO had ended with 64.82 times subscription. The IPO secured bids for 3720.21 crore shares, compared to the issue size of 57.39 crore shares. The qualified institutional buyer category was subscribed 115.90 times. The non institutional investor category was subscribed 40.34 times. The retail investor category was subscribed 6.76 times. The issue constituted 13.64% of the fully diluted post-issue capital of the company. Along with the IPO, the government has sold 5% of its shares in the company. Power Grid Corporation of India owns and operates most of India’s interstate and inter-regional electric power transmission system. In that capacity, as at June 30, 2007 the company owned and operated 61,875 circuit kilometres of electrical transmission lines and 106 electrical substations. In fiscal 2007, it transmitted approximately 298 billion units of electricity, representing approximately 45% of all the power generated in India. The net proceeds of the fresh issue shall be utilised for 15 identified transmission projects of the company. The estimated cost of these projects as on 31 July 2007 is approximately Rs 12,707.5 crore. These projects are proposed to be funded with a debt-equity ratio of 70:30 in accordance with Central Electricity Regulatory Commission (CERC) norms. The equity component of the identified projects is to be funded by a combination of internal accruals of the company and the proceeds of the fresh issue. Power Grid Corporation of India registered net profit of Rs 453.91 crore on sales of Rs 975.46 crore in Q1 June 2007. It clocked net profit of Rs 1087.65 crore on sales of Rs 3589.85 crore in FY 2007 (year ended 31 March 2007).