NTPC offer price set at Rs 52-62

Issue expected to hit market in the first week of October.

Power utility National Thermal Power Corporation (NTPC) today fixed the price band for its forthcoming initial public offer (IPO) at Rs 52-62 per share.

The power maker today received the final clearances from the market regulator, the Securities and Exchange Board of India (Sebi), for the 100 per cent book built issue.

NTPC will submit the prospectus with the Registrar of Companies tomorrow. The issue is expected to hit the market in the first week of October.

NTPC will offer 866 million shares, amounting to 10.5 per cent of the post-issue expanded capital and comprising equal blocks of fresh shares and sale of existing shares, with the face value of Rs 10 each.

At the upper level of the indicated price band, the IPO is expected to raise Rs 5,369 crore, the second largest public offer after TCS, which garnered a record Rs 5,420 crore.

This puts NTPC's valuation at Rs 51,135 crore, making it the country's third most-valuable firm after ONGC and Reliance. It edges out Indian Oil from the third spot according to today's market capitalisation numbers.

Market sources said the TCS issue's proved there was no dearth of demand for quality paper in the Indian primary market. Going by the huge response to the TCS issue "" subscribed 7.7 times "" it is expected that the NTPC offer would also be able to a elicit good response in the market, they added.

The company had said that the proceeds of the public offer would be utilised to finance expansion plans to feed the growing demands of India's energy-starved economy.

The NTPC offer ran into trouble, after the general elections earlier this year, after the Communist parties opposed the plan to expand the offer size by divesting a 5.25 per cent stake in the company.

The previous government led by the BJP had cleared a fresh issue of 432.9 million shares, which would have lowered the government's stake to 94.75 per cent.