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Anil Sasi

New Delhi, Oct. 31 Power Grid Corporation of India Ltd (PGCIL), the country’s largest electricity transmission utility, is expected to come out with a follow-on public offer (FPO) in the first quarter of the next fiscal.

Unlike the FPO proposals of NTPC Ltd and Rural Electrification Corporation cleared by the Cabinet recently, the PGCIL issue is likely to be a fresh issue of shares and not entail any disinvestment of the Centre’s stake in the utility.

The state-owned firm would offer around 15 per cent of its equity and hopes to mop-up about Rs 3,000 crore, a company official said. Also, by March the utility is planning two domestic bond issues of Rs 2,000 crore each.

“Our FPO is set for the first quarter of the next financial year, possibly April or May. The offer size will be decided by the Government of India,” the official said. The proceeds from the issue would be used by the company to part-finance its ongoing projects aimed at strengthening the regional grids and to support the targeted generation capacity addition programme of about 78,000 MW during the current Plan period.

The Centre had earlier divested a 5 per cent stake in PGCIL, piggybacking on the maiden equity offering by the company. Through the sale of 382 million shares in September 2007, PGCIL mopped up Rs 2,984 crore.

Of this, Rs 1,989 crore went to the company, with the balance Rs 995 crore being routed to the Centre as disinvestment proceeds. Following the share sale, the Centre has an 86.36 per cent stake in the company.

The ‘navratna’ enterprise is among the largest dedicated transmission utilities in the world. It wheels about 45 per cent of the total power generated in India on its transmission network of around 71,500 circuit-km. PGCIL had reported a net profit of Rs 1,691 crore on revenues of Rs 6,676 crore in 2008-09.

More Stories on : Power | Public Offer | Corporate Bonds

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