Simultaneously, the public sector firm would also invite expressions of interest for ultra mega power projects of 4,000 MW each by January 31, with an aim of transferring these plants to potential private companies by the end of 2006.
"We will hit the market with our initial public offer and sale of government equity during April-June this year," PFC chairman and managing director V K Garg said. The public sector firm would shortly appoint merchant bankers for the IPO from among the six shortlisted ones - Citibank, ICICI Securities, HSBC, Enam Financials, Kotak Mahindra and DSP Merril Lynch, he said.
PFC's paid-up capital is Rs 1,030 crore (Rs 10.30 billion), which would rise to Rs 1,134 crore (Rs 11.34 billion) after the issue, he said, adding government holding in the company would come down to 86.36 per cent from 100 per cent at present. The issue comprises of 10.3 crore (103 million) fresh shares and sale of 5.15 crore shares by the government.
When asked about the price band or the amount that the company plans to raise from the issue, Garg said it would be decided through a book-building process in consultations with the merchant bankers.
However, industry sources said PFC has a book value of Rs 65 per share and it could charge some premium over it. This could translate to a price band of Rs 70-100, which would fetch between Rs 1,080 crore (Rs 10.80 billion) to Rs 1,500 crore (Rs 15 billion).