New Delhi-based Hindustan Power Projects Limited (HPPL), formerly known as Moser Baer Projects Private Limited, plans its initial public offering (IPO) to raise around INR32 billion. The electrical power developer is backed by American multinational private equity Blackstone Group which plans to partially exit its holdings in the company. Citigroup has been authorized as the lead manager of the IPO which will value the company at INR128 billion. The public offer is expected to be launched by the end of current FY.
Blackstone Group’s partial exit plan
Blackstone Group made its second largest investment in India of nearly INR14 billion in Hindustan Power Projects in 2010. The investor will earn around five folds and is on the lookout for partial exit via this issue. Other investors include SBI-Macquarie, a private equity fund focusing on infrastructure which had invested in company’s thermal power assets. Blackstone has also invested in other companies including Nuziveedu Seeds and SH Kelkar. Interestingly, both the companies are in the IPO queue and have received regulatory approvals.
Established in 2008, Hindustan Power Projects is India’s leading player in the energy sector and plans to commission 7000 MW of thermal, solar and hydro power by 2020. Further the company is also developing over 6100 MW of capacity using conventional and non-conventional energy sources in India, Europe and the USA.
Hindustan Power Projects is in advanced stages of commissioning 5000 MW by 2017 of combined power assets investment valued at INR320 billion. Company’s solar division has an installed capacity of 350 MW and targets 1 GW capacity by 2016. HPPL owns power generation assets in many states of India including Madhya Pradesh, Tamil Nadu, Chhattisgarh, Punjab, Orissa, West Bengal etc and internationally in US, UK, Germany, Italy, and Japan.
Growing IPO size
HPPL IPO will be one of the biggest public issues in India in recent years. While booming stock markets are encouraging companies to tap the IPO route, debt-laden infrastructure companies have been particularly active. Out of the 16 IPOs so far in India, three have been from infrastructure space. MEP Infrastructure Developers, PNC Infratech, and Sadbhav Infrastructure Projects raised a combined INR13.04 billion through their respective IPOs. Other hopefuls include Essel Infra’s INR15 billion offer, G R Infraprojects INR4 billion and GVR Infra Projects.
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Indian markets are witnessing a vigorous growth in the number of public issues this year and several big-ticket IPOs have lined up. InterGlobe Aviations’ INR25 billion IPO is expected to be launched on 26 October while Coffee Day’s INR11.5 billion offering is scheduled to close today.