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Rel Power IPO subscribed in one minute

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BS Reporter Mumbai
Anil Dhirubhai Ambani Group-promoted Reliance Power Ltd's Rs 11,700 crore initial public offering (IPO) got off to a blazing start today with the share sale "" India's biggest "" fully subscribed within a minute of opening at 10 am.
 
The issue, which was subscribed by about 10 times, received bids for 2.4 billion shares, worth Rs 1.08 lakh crore.
 
Reliance Power is issuing 260 million shares at a price band of Rs 405 to Rs 450 each. The issue closes on Friday.
 
Institutional investors, which were responsible for most of the demand on the first day, are eligible to apply for shares by putting just 10 per cent of the amount required at the time of bidding.
 
The Qualified Institutional Bidder (QIB) portion was subscribed 17.5 times and high net worth investor (HNIs) segment was subscribed 6.7 times.
 
The retail portion was subscribed about 60 per cent (0.6 times) at the time of going to press.
 
The frenzied bidding for Reliance Power's shares is unmatched in Indian stock market history after the share offer received applications for Rs 333 crore worth shares in every minute during the first five hours, according to officials.
 
"We were virtually on our toes to process the applications that poured in from investors. The Reliance Power IPO has seen the entry for several thousands of first-time investors into the stock market," said Dinesh Thakkar, managing director of Angel Broking, which is among the several broking firms that distribute the IPO application forms.
 
Due to the unprecedented demand, the company has also extended the timing for receiving applications till 9 pm today.
 
Reliance Power's initial share sale will surpass the record set by Delhi-based property developer DLF Ltd, which raised Rs 9,200 crore last year.
 
Dealers said Anil Ambani's decision to pay at the upper end of Rs 450 apiece for the promoter's contribution of 32 million shares also boosted investor confidence for the issue.
 
Anil Dhirubhai Ambani Group's Reliance Energy quadrupled in value last year, the best-performing stock on the Sensex, on the news of the Reliance Power IPO (REL holds 50 per cent stake in Reliance Power Ltd) and on government plans to invest $200 billion in generation and distribution in seven years.
 
Reliance Power will lead at least Rs 30,000 crore share sales this year by Indian power companies. Some other power IPOs expected this year are from Sterlite Industries (India) Ltd, Mumbai-based JSW Energy Ltd, and Jaiprakash Power Venture.

 

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First Published: Jan 16 2008 | 12:00 AM IST

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