New Delhi Vedanta Group arm Sterlite Power Transmission Ltd is waiting for favorable market conditions before launching a planned initial public offering (IPO). 1,250 crores.
Managing director Prateek Agarwal said timing of the share sale would depend on market demand and valuations as well as other fundraising options available with the company.
“It completely depends on the market; It is not for us to decide for ourselves. This is business that needs capital, so we will take whatever is the best solution on the table,” Agarwal said in an interview.
Sterlite Power had applied for the IPO in August last year and received the approval of markets regulator SEBI in December. However, given the weak market conditions due to geopolitical tensions and bearish concerns, it is yet to initiate the share sale. SEBI approval will be valid for 12 months.
Noting that Sterlite Power is looking at various fundraising options, Agarwal said: “We are constantly looking for capital solutions that address scale, size, valuation, flexibility; All the requirements that should come with capital. And, right now, we have the option of the public markets, if the market supports and investors are excited. But, of course, there are private investors too and that option exists. So, we are evaluating everything.”
Mint reported on July 21 that Sterlite Power is in talks with the Pension Fund and Sovereign Wealth Fund to raise $500-1 billion. Agarwal said there are several ways to finance the company’s growth, including monetizing assets through an Infrastructure Investment Trust (InvIT). In 2020, Sterlite Power sold its 14.7% stake in India Grid Trust (IndiGrid) to institutional and high net worth individual investors. 840 crores. In its draft prospectus, the company said it would use the proceeds of the IPO either in full or for repaying certain debts and for general corporate purposes. “Our company expects that the listing of equity shares will enhance our visibility and our brand image amongst our existing and potential customers.”
Apart from India, the company also has operations in Brazil. Recently, it has got two transmission projects in the South American country.
Sterlite Power has a total of 28 projects covering 13,950 circuit kilometers of transmission lines in India and Brazil. It also has a portfolio of high-performance power conductors, extra high voltage cables and optical ground wires. The company’s funding needs are expected to grow in line with its diversification plans.
According to the draft prospectus, Sterlite Power’s net profit fell 7.7% in FY2011 870.12 crores.
rituraj.baruah@livemint.com
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