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September 01, 2007 17:33 IST
Central transmission utility PowerGrid Corp said on Saturday it plans to invest Rs 55,000 crore (Rs 550 billion) in the next five years to expand the national grid capacity to transmit 37,000 MW of electricity by 2012.
To part finance these projects, PGCIL is hoping to raise up to Rs 3,000 crore from its initial public offer. "The price band for the issue has been fixed between Rs 44 and Rs 52 per equity share," PGCIL Chairman and Managing Director R P Singh told reporters.
The issue, which opens on September 10, would mop up Rs 2,525 crore (Rs 25.25 billion) at the lower end and Rs 2,984 crore (Rs 29.84 billion) at the upper end. Along with the IPO, the government is selling 5 per cent of its existing shares in the company.
The proceeds would be used to part-finance 15 projects that entail a total investment of Rs 12,280 crore (Rs 122.8 billion).
"These projects are to be funded in a debt-equity ratio of 70:30. The equity is to be funded by a combination of internal accruals and proceeds from the fresh issue," he said.
PGCIL owns and operates 61,875 circuit kms of transmission lines. The proposed 15 projects would enhance its transmission system by 13,022 circuit kms. The company currently has inter-regional electricity transfer capacity of around 14,000 MW and plans to scale it up to 37,000 MW.
Singh said the company plans to invest Rs 55,000 crore (Rs 550 billion) over the next five years for transmission and telecommunications projects.
Out of the Rs 12,280 crore (Rs 122.8 billion) investment, Singh said PGCIL has spent Rs 4,278 crore (Rs 42.78 billion) as on March 31, 2007.
The company would issue 57.39 crore equity shares of Rs 10 each at a price to be determined by 100 per cent book building route. It would constitute 13.64 per cent of the fully diluted post-issue capital of the company.
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