[Ways-2gain] Fw: Exclusive: Konaseema Power to raise Rs 4 bln to fund capex

 

By Santanu Chakraborty    MUMBAI, JUL 14 (TickerNews Service): The Konaseema power plant plans to raise Rs 4 billion through selling shares to financial institutions after its 460 MW gas-based power plant started functioning in full capacity, managing director MSP Rama Rao told Ticker News.    "We plan to raise Rs 4 billion for meeting our capital requirements," Rama Rao said.     "All the three units of the power plant have become operational. Currently, we are generating 440 MW and we plan to ramp up our capacity in the future," Rao said.    Konaseema jointly promoted by VBC Industries, VBC Ferro Alloys and Elgi, also plans to list its shares on the stock exchanges in the next two years.    Konaseema Power Plant was lying idle since 2006 and needs 200,000 million cubic metre of gas per day. The plant became operational following natural gas supply from Reliance Industries Limited.    Of this, VBC Ferro Alloys and VBC Industries hold around 36% stake in the plant.    Konaseema is planning to expand its capacity by setting up 820 MW gas based combined cycle power project at an estimated cost of Rs 28 billion, said Sunil Pachisia, assistant vice president of Ideas First Research.    Ideas First Research expects Konaseema to raise funds at Rs 40 per share to fund its Phase II expansion.    Tuesday, Essar Power Limited, a subsidiary of London-listed Essar Energy Plc, said it will buy out 100% stake in 2250 MW Navabharat Power Private Ltd in Orissa.    Konaseema Power expects to get high valuations for its share sale after the Nava Bharat Power deal and a spate of mid-sized deals in the power sector.    Analysts said an increasing numbers of small players have announced capacity additions in the power sector which in turn can be targeted by large players.    "However setting up a power plant is no easy task with minimum of 3-4 years of time required to get the various clearances. Thus, to avoid the loss of opportunity, we believe a lot of large players will increasingly use the inorganic route to bolster their generation capacity," said an analyst with Networth Stock Broking.    The company targets an annual turnover of Rs 12 billion during the current financial year.       The plant is realizing per MW average cost of Rs 2.60 as it is not able to sale merchant power.    The state government will give Re 1 per unit apart from gas cost, which will be another Rs 1.60 per unit.   Wednesday, shares of VBC Ferro Alloys closed at Rs 433.80 on National Stock Exchange, up 8.8% from previous close. VBC Industries shares closed at Rs 26.40, up 9.3% from previous close. Thanks & Warm Regards, SUNIIL D PACHISIA

__._,_.___

Reply to sender | Reply to group | Reply via web post | Start a new topic

Messages in this topic (1)

Recent Activity:

• New Members 13

Visit Your Group

Switch to: Text-Only, Daily Digest • Unsubscribe • Terms of Use

.

__,_._,___