The Hindu Business Line : GIPCL plans Rs 275-crore public issue by month-end

"We are waiting for a final clearance from the Securities and Exchange Board of India. We hope to get the green signal in the next couple of days and enter the market in the last week of September," the company's Managing Director, Mr L. Chuaungo, told Business Line.

The book-built public issue would comprise fresh issue of shares and would involve offering Rs 200 crore worth of equity to the general public and the rest to employees and GIPCL promoters - the Gujarat Electricity Board (GEB) and Gujarat Alkalies and Chemicals Ltd.

Post the public issue, the floating equity of GIPCL would rise to about 25 per cent from 11 per cent at present. GIPCL would use the funds for a proposed 270-300 MW lignite-based pithead power plant in south Gujarat.

The company has already taken lignite mines in Valia-Mangrol in Surat district.

The company has mines with an approximate deposit of 212 million tonnes, which is adequate to fuel a 1000 MW power plant for 30 years.

The company, which already has an installed capacity of 555 MW, has also signed a memorandum of understanding with GEB to sell the power produced from the new plant.

A formal power purchase agreement would, however, be signed after GIPCL finalises the engineering procurement and construction (EPC) contract.

"We have received bids for the EPC contract. We are insisting on the environment friendly CFBC technology and hope to finalise the contractor in the next couple of months," Mr Chuaungo said, adding that the plant would be commissioned in three years.

The company has received technical bids from Alstom-Reliance and Lurgi-BHEL combines.

The project would be funded on a 75:25 debt to equity ratio and GIPCL has already tied up for funds from different banks and financial institutions at rates ranging from 7.5 to 8.3 per cent, Mr Chuaungo said.

The company's shares closed at Rs 85.85 on the National Stock Exchange on Friday.

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