Reliance Power IPO on track

The company has announced plans to sell 10.1% of the company making it India’s biggest IPO

Reliance Power has not changed its plans to list its shares, the Anil Dhirubhai Ambani Group that controls the firm said on 23 October, reacting to market speculation the initial public offer may be postponed.

The company has announced plans to sell 10.1% of the company, which media reports have said may raise $2.8 billion, making it India’s biggest IPO.

The group, which also has interests in telecoms, financial sector and infrastructure, controls Reliance Power through group companies including Reliance Energy, which has a 50% holding in the firm.

There is a “vicious campaign of disinformation underway by vested industrial interests to stall Reliance Power’s IPO”, a spokesman for the group said in a statement.

“The campaign is motivated by frustration at continuing success and rising valuations of ADA Group,” he said.

Reliance Power is awaiting the approval of the market watchdog for the offering, he said.

Several sources familiar with the deal said the firm was hoping to price its share offer at the end of November or start of December.

“For the time being they’re looking to launch it in pre-marketing next week,” one source said.

“The original timetable is still going fine,” said another source. “The roadshow was due to start around mid-November, the week of 12 November.”

But a third source said the timetable had to be flexible because it was impossible to start the roadshow around Asia and Europe until the firm had received approval from the Securities and Exchange Board of India (Sebi).

“They’re targetting to complete the transaction by the end of the year. If you want to complete the deal by the end of the year, you have to launch it by mid-November,” the source said.

“If the SEBI’s approval comes in a bit late, everything will be pushed back.”

Up to 30% of the shares will be offered to retail clients, with a further 10% going to high net worth individuals. Institutional investors will be offered 60%, and may get the chance for more if retail demand is weak.

The issue will be managed by UBS, ABN AMRO, JPMorgan, Deutsche Bank, Enam Securities, ICICI Securities, JM Financial and Kotak Mahindra Capital, while Macquarie India and SBI Capital Markets are co-managers.

The Anil Dhirubhai Ambani group was formed two years ago when the Reliance group was split between elder brother Mukesh Ambani, who controls Reliance Industries Ltd, and Anil.