Ispat hits the PE trail to mop up Rs 800 cr
While the mandate for advising the private placement is still being discussed among various merchant bankers, some of the big names doing the rounds are ICICI Securities, Merrill Lynch, Goldman Sachs, SBI Caps and Credit Suisse First Boston.
The move by Ispat follows a slew of initial public offerings and pre-IPO deals by power companies. While Reliance Power is readying its mega IPO, many others, including Essar, Sterlite and JSW, are currently sewing up pre-IPO deals.
“PE funds invest selectively, where growth and returns are strong, such as renewable energy, and niche segments in equipment manufacture and merchant plants. The power companies have seen huge market valuations, leading to attractive gains for investors,” said Kameswara Rao, leader power practice, PricewaterhouseCoopers (PwC).
Thanks to the power deficit of 22,000 MW in the country, the power generation companies are getting high valuations. The company, which plans Rs 20,000 crore investment, could easily fetch $3-5 billion valuation, said an investment banker.
Ispat Energy, which is at an advanced stage of completion of a 110 mega watt (mw) captive power plant at Dolvi near its steel plant, is looking at a price earnings multiple of 20-25, a merchant banking source bidding for the deal said.
The construction of the plant is in final stages and it is slated to be commissioned by October–November 2008. The plant is based on blast furnace waste gas which the Ispat’s 2 million tones blast furnace is producing and hence the fuel for power generation is virtually free.
Ispat Energy is also looking at setting up another 150 MW of power plant based on coke oven gas with Ispat setting up a 1.5 MTPA coke oven plant with its trading partner Stemcor of UK.
Being set up at a cost of Rs 386 crore, the total cost of generation including depreciation and finance charges is expected to be only around Rs 2 per unit.
While Ispat currently buys power from state electricity board at a price of Rs 4.25 per unit, Ispat Energy is expected to generate a surplus of Rs 160-170 crore annually with an estimated generation of 75 million units per annum. Ispat Energy has a debt of Rs 240 crore and equity of about Rs 150 crores.
Nifty 7 K target intact
Another huge volatile session today but we are not disturbed because we know for sure volatile market is the best time for choosing jewels. Market punters had gone long disproportionately which is always dangerous for the trades. It was perceived earlier that the threat of correction till 6100 but since Nifty was admittedly not falling below 6210 made everybody believe that it has bottomed out. Today too it crossed 6300 to create false signal and finally the inevitable has happened in the last 30 minutes as usual. My Nifty target of 6990 is intact and I expect this to touch post Budget. This is LAXMAN rekha for the time being and hence I am openly asking all our members to hold positions and even churn portfolio very fast. Every market has some multi baggers and in fact I feel that this is the best market having "n" no. of stocks still undervalued provided you know the jewels. Who had imagined KEMROCK will touch Rs 1000 except us and it did….?
This was lull before the storm. Infosys set to announce results tomorrow and market is gasping a bad performance from Infosys which is not correct. Mastek and I Gate announced stunning results which means Rupee has been factored in for the time being. Infosys will rise which means market will rise but roller coaster is not ruled out for next 3 days in order to remove ticket less passengers.
We are sticking with our target and confidence level and we just can’t get bogged down by the screen. We are here to prove ourselves which we have done time and again and this time too there is no exception. Weak players must exit from futures positions even if in losses no problem because this game is now only for lion hearted traders. Volatility will remain forever and we always fancy such falls for accumulation. The clarity in the market is my profit on the given day which is 20 to 30% in no time.
Now which stocks you need to acquire in such crisis time which can give you 30% return is not an ordinary call and hence we will share the same in the Chakry talk section. This will add value to the existing customers. We are here to protect your capital though you have every right to lose it on its own. Faith and friendship and love is the universal equation. We do not boost that we can’t go wrong but for sure we understand the market better than others becuase we are have no vested interest.
You may have to digest little more pain tomorrow becuase of margin call trigger becuase every time market break techncial barrier, my friends generate sell call and they have obliged the same today. There weakness is my strenght.
Let your capital be simplicity and contentment.
VIP Industries - Updates
VIP Industries Ltd has informed that the Hon'ble High Court of Judicature at
IG Petrochemicals to issue & allot warrants
IG Petrochemicals Ltd has informed that the members at the Extra Ordinary General Meeting (EGM) of the Company held on January 09, 2008, have passed the Special Resolution to offer, issue and allot 15,00,000 share warrants at a price of Rs 77.50 per warrant to M/s. Financierings Maatschappji voor Ontwikkelingslanden N V (FMO) to he converted into 15,00,000 equity shares of Rs 10/- each at a premium of Rs 67.50 per equity share in the ratio of 1:1 within a period of 18 months from the date of allotment of share warrants.
L&T bags Rs 2000 crore orders for
Larsen & Toubro Ltd (L&T) has informed that Larsen & Toubro's (L&T) Construction Division has recently secured orders on Design and Build / Turnkey basis from leading Developers / Owners. Prominent amongst these include Rs 2000 cr order from M/s. Kingston Properties Pvt Ltd for construction of various office & residential buildings in Mumbai, to be developed in a span of 4 years.
Apart from this project the Buildings and Factories (B&F) Business Unit of L&T's Construction Division (ECC) has secured orders for many assignments including Rs 665 cr design & build contract from M/s. Cognizant Technology Ltd for their development centres in Chennai and Kolkatta.
L&T has also bagged a Rs 187 cr, turnkey order from M/s. ITC Hotels Ltd for their Grand Chola Hotel at Chennai. The scope involves construction of 1.52 million sq ft area to house 600 rooms.
The Company has secured a Rs 408 cr contract from M/s. ICICI Bank for construction of their office building at
L&T's ECC division has also secured a Rs 300 cr order from M/s. CSJ Infrastructure Pvt Ltd for construction of 3.00 million sq ft building at
Incidentally, in the last 9 months of this year, the business unit has so far bagged contracts worth nearly Rs 12000 crore including Mumbai International Airport Ltd (MIAL).
Power Grid lines up Rs 12k crore for diversification
Power Grid Corporation of
The company is in talks with the World Bank and the Asian Development Bank (ADB) to avail loans of $600 million from each.
While the talks with the World Bank will conclude by February, negotiations with ADB will begin in the same month. Besides, efforts are also on to avail loans of $1 billion each from the World Bank and ADB without government guarantee.
“If this materialises (the loans), it could open up new windows of opportunity for investing in
The company hopes to mobilise about Rs 20,000 crore from the private sector, at a 70:30 debt-equity ratio. “If the private sector investments are below the target, we will go in for equity dilution up to 80:20 per cent, to raise the requisite funds for our projects,” he added.
Power Grid is in talks with a state and a private player to launch entertainment services through a joint venture.
“The company is also planning to enter the tower business, data centre management, gigabit knowledge network and voice over internet, utilising its nationwide power transmission network,” said R P Singh.
“Our plans are to get into the A to Z of telecom and its related businesses. We will invest as and when required, depending on the returns. Returns from this business are as high as 20-23 per cent, much higher than what we get from power transmission,” he said.
He declined to name the joint venture partners citing the confidentiality agreement. Power Grid, which carries 45 per cent of the power generated in India, already has a 19,000 km long fibre-optic telecom network, part of its power transmission infrastructure, and has already leased bandwidth to various telecom companies.
During financial year of 2007-08, telecom revenues for the company increased to about Rs 90 crore for the nine months ending December 2007, from Rs 51 crore for the corresponding period in the previous year.
Singh said the firm has orders worth Rs 300 crore for the quarter ended December 31, 2007, and is hoping for Rs 500 crore-plus turnover from the telecom and entertainment businesses by next financial year.
The company will soon float global tenders worth over $1 billion to develop transmission grids which will transmit power from the NE region to supply the north and western parts of the country.
Vishnu chemicals will be the biggest block buster of 2008 ans 2009
Vishnu chemicals will be the biggest block buster of 2008 ans 2009
S S Duncan shaping up....
Why are we so bullish on S S Duncan....?
Today
Auto companies will definitely make a killing in next 3 years. Tata Motor will cross Rs 2000 whereas Maruti will become Rs 3000 and we have no doubt about the same. What is more interesting to note is that where from they will source component....?
It is like Steel cos dyeing for iron ore and oxygen. Therefore the bigger call is in auto spares.
Precisely this is the reason major auto spare manufactures are entering
S S Duncan has now geared to catch the momentum as co has shifted its MULUND plant to Ranjangaon Pune and done VSR for Mumbai employees. This is an indication of its realty deal happening soon.
If this is happening then co would get close to Rs 275 crs ie Rs 500 per share. After merger of its
It is a sure multi bagger MNC investment from the investment perspective.
Indian Rupee Exchange Rate
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