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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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Saturday, 25 July 09
HUANENG EYES MAJORITY STAKE IN PT BERAU COAL
CCTV reported that, China's largest publicly traded power company has submitted a bid for controlling stake in Indonesia's fifth largest coal mine ...
Saturday, 25 July 09
ADANI POWER TO IMPORT COAL FOR MUNDRA PLANT
BL reported that more than 50% of the coal requirement for Adani Power’s 4,620 MW Mundra plant will have to be imported from Indonesia though ...
Friday, 24 July 09
INDONESIAN COAL NEWS - UPDATE
Income from tax slow
Since the economic crisis in October 2008 until now, tax from the general mining sector is slow. According to the Director Gene ...
Friday, 24 July 09
S.AFRICA JAN-JUNE EXPORTS TO ASIA AROUND 1.4 MLN T
* China takes 140-150,000 tonnes
* S.Korea imports zero
* Hong Kong utilites buy S.African coal
South African coal exports to Asia excluding India a ...
Friday, 24 July 09
BIG ADARO SHAREHOLDERS CREATE HOLDING COMPANY
The nation’s second-largest coal producer, PT Adaro Energy, said on Thursday that five key shareholders had merged their holdings in the compan ...
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- Medco Energi Mining Internasional
- Chamber of Mines of South Africa
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- Globalindo Alam Lestari - Indonesia
- Bayan Resources Tbk. - Indonesia
- Georgia Ports Authority, United States
- Planning Commission, India
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- Directorate Of Revenue Intelligence - India
- Global Business Power Corporation, Philippines
- London Commodity Brokers - England
- Timah Investasi Mineral - Indoneisa
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- ICICI Bank Limited - India
- Price Waterhouse Coopers - Russia
- Oldendorff Carriers - Singapore
- Bangladesh Power Developement Board
- Singapore Mercantile Exchange
- Leighton Contractors Pty Ltd - Australia
- Bulk Trading Sa - Switzerland
- Toyota Tsusho Corporation, Japan
- GAC Shipping (India) Pvt Ltd
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- White Energy Company Limited
- Baramulti Group, Indonesia
- Directorate General of MIneral and Coal - Indonesia
- The Treasury - Australian Government
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- Cigading International Bulk Terminal - Indonesia
- Jaiprakash Power Ventures ltd
- Indian Oil Corporation Limited
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- European Bulk Services B.V. - Netherlands
- IEA Clean Coal Centre - UK
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- Cement Manufacturers Association - India
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- MS Steel International - UAE
- Kobexindo Tractors - Indoneisa
- VISA Power Limited - India
- Jindal Steel & Power Ltd - India
- Malabar Cements Ltd - India
- Bharathi Cement Corporation - India
- SMG Consultants - Indonesia
- Commonwealth Bank - Australia
- Sarangani Energy Corporation, Philippines
- Rashtriya Ispat Nigam Limited - India
- Barasentosa Lestari - Indonesia
- Sojitz Corporation - Japan
- Maharashtra Electricity Regulatory Commission - India
- Goldman Sachs - Singapore
- Marubeni Corporation - India
- Power Finance Corporation Ltd., India
- AsiaOL BioFuels Corp., Philippines
- Mintek Dendrill Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Trasteel International SA, Italy
- Central Java Power - Indonesia
- PowerSource Philippines DevCo
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- Therma Luzon, Inc, Philippines
- CNBM International Corporation - China
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- Interocean Group of Companies - India
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- Karaikal Port Pvt Ltd - India
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- Indo Tambangraya Megah - Indonesia
- Indonesian Coal Mining Association
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- Borneo Indobara - Indonesia
- Larsen & Toubro Limited - India
- Heidelberg Cement - Germany
- Merrill Lynch Commodities Europe
- Rio Tinto Coal - Australia
- Coal and Oil Company - UAE
- Wilmar Investment Holdings
- Renaissance Capital - South Africa
- Kepco SPC Power Corporation, Philippines
- Electricity Authority, New Zealand
- Bhatia International Limited - India
- International Coal Ventures Pvt Ltd - India
- LBH Netherlands Bv - Netherlands
- Banpu Public Company Limited - Thailand
- Aboitiz Power Corporation - Philippines
- Ambuja Cements Ltd - India
- Kideco Jaya Agung - Indonesia
- SMC Global Power, Philippines
- Electricity Generating Authority of Thailand
- Bukit Makmur.PT - Indonesia
- Straits Asia Resources Limited - Singapore
- Port Waratah Coal Services - Australia
- Meralco Power Generation, Philippines
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- Petron Corporation, Philippines
- Tata Chemicals Ltd - India
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- Carbofer General Trading SA - India
- SN Aboitiz Power Inc, Philippines
- Chettinad Cement Corporation Ltd - India
- Semirara Mining Corp, Philippines
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- Uttam Galva Steels Limited - India
- Iligan Light & Power Inc, Philippines
- Kumho Petrochemical, South Korea
- Thiess Contractors Indonesia
- Sical Logistics Limited - India
- Metalloyd Limited - United Kingdom
- Vedanta Resources Plc - India
- San Jose City I Power Corp, Philippines
- Orica Mining Services - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Ministry of Finance - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Sree Jayajothi Cements Limited - India
- Siam City Cement - Thailand
- Miang Besar Coal Terminal - Indonesia
- Kartika Selabumi Mining - Indonesia
- ASAPP Information Group - India
- Indika Energy - Indonesia
- Vizag Seaport Private Limited - India
- Global Coal Blending Company Limited - Australia
- TNB Fuel Sdn Bhd - Malaysia
- Independent Power Producers Association of India
- Kaltim Prima Coal - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Bukit Baiduri Energy - Indonesia
- Australian Commodity Traders Exchange
- Kapuas Tunggal Persada - Indonesia
- Sakthi Sugars Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Orica Australia Pty. Ltd.
- Mercator Lines Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Eastern Coal Council - USA
- Posco Energy - South Korea
- Standard Chartered Bank - UAE
- Samtan Co., Ltd - South Korea
- The University of Queensland
- Star Paper Mills Limited - India
- Indogreen Group - Indonesia
- Mjunction Services Limited - India
- Tamil Nadu electricity Board
- Meenaskhi Energy Private Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Binh Thuan Hamico - Vietnam
- Ceylon Electricity Board - Sri Lanka
- Grasim Industreis Ltd - India
- Parliament of New Zealand
- Energy Link Ltd, New Zealand
- Edison Trading Spa - Italy
- Eastern Energy - Thailand
- Energy Development Corp, Philippines
- Semirara Mining and Power Corporation, Philippines
- Anglo American - United Kingdom
- Salva Resources Pvt Ltd - India
- Manunggal Multi Energi - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Global Green Power PLC Corporation, Philippines
- Romanian Commodities Exchange
- Ind-Barath Power Infra Limited - India
- Makarim & Taira - Indonesia
- Dalmia Cement Bharat India
- Agrawal Coal Company - India
- Gujarat Electricity Regulatory Commission - India
- Sindya Power Generating Company Private Ltd
- Kalimantan Lumbung Energi - Indonesia
- Lanco Infratech Ltd - India
- Minerals Council of Australia
- Attock Cement Pakistan Limited
- Economic Council, Georgia
- PTC India Limited - India
- Australian Coal Association
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Xindia Steels Limited - India
- GVK Power & Infra Limited - India
- The State Trading Corporation of India Ltd
- Jorong Barutama Greston.PT - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Gujarat Mineral Development Corp Ltd - India
- Wood Mackenzie - Singapore
- Formosa Plastics Group - Taiwan
- Intertek Mineral Services - Indonesia
- IHS Mccloskey Coal Group - USA
- Africa Commodities Group - South Africa
- Ministry of Mines - Canada
- Karbindo Abesyapradhi - Indoneisa
- Antam Resourcindo - Indonesia
- Pendopo Energi Batubara - Indonesia
- Ministry of Transport, Egypt
- Deloitte Consulting - India
- Aditya Birla Group - India
- Latin American Coal - Colombia
- Maheswari Brothers Coal Limited - India
- New Zealand Coal & Carbon
- South Luzon Thermal Energy Corporation
- Simpson Spence & Young - Indonesia
- Coalindo Energy - Indonesia
- Parry Sugars Refinery, India
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