The Hindu Business Line : ‘RPower investment in liquid schemes’ market value important’

Mumbai, Jan. 22 Reliance Power, whose jumbo initial public offering of shares had collected Rs 11,500 crore in January last year, has utilised Rs 2,686 crore of the proceeds as of December 31, 2008, while Rs 8,874 crore of the IPO money had been invested in liquid and fixed maturity plans.

The utilised portion has gone towards the company’s Krishnapatnam, Tato II and Siyom power projects, according to Reliance Power’s notes to its accounts for the third quarter of the current fiscal.

Analysts noted that the market value of the investments made in liquid and fixed maturity plans had not been disclosed, so one could not determine whether there any erosion or not in the shareholder money that the IPO had fetched. “The market value of these investments is alone the real indicator of the use of resources, especially in the current context, when the benchmark indices have declined more than 50 per cent since the time of the IPO in January 2008,” said one equity analyst.

The Anil Ambani group company has reported an operating loss of Rs 19 crore (before other income interest and exceptional items). Profit after interest and before exceptional items amounted to Rs 112 crore.

The company’s stock declined 1.64 per cent on BSE, closing at Rs. 98.7 on Thursday, down from Rs 100.35 on Monday.

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