After the poor response to NTPC’s recent FPO, the subscription of Rural Electrification Corporation’s by 3.1 times brought cheer for Union Power Minister Sushilkumar Shinde. In an interview over telephone with Sanjay Jog, he hoped the coming issues of SJVN and PowerGrid Corporation would get a good response. Excerpts:
Finally, REC FPO is oversubscribed. What’s your comment?
REC’s FPO was subscribed by 3.1 times. The QIB (qualified institutional buyer) section was oversubscribed by 5.6 times, HNI (high net worth individuals) by 1.7 times and the retail section by 0.2 times. Retail subscription may further increase. REC has received bids of Rs 10,000 crore and this is quite crucial, taking into consideration the critical situation ahead of the annual budget.
Were the bids as estimated or less?
The bids are as we estimated. This shows confidence in the power sector by both Indian and foreign investors. What is interesting is that foreign institutional investors (FII)s have bid for the company’s FPO book. The FPO once again proved that the Indian power sector is a happening story and foreign investors, in particular, are keen to invest.
What will be the fate of the ensuing issues of power PSUs?
I strongly feel PowerGrid’s proposed FPO and Satluj Vidyut Nigam’s IPO will be successful. Investors will come forward in a big way. These issues are slated for next fiscal (year).
However, the capacity addition of 78,700 Mw aimed for the 11th Plan (2007-12) will not be achieved?
We will be able to achieve over 62,000 Mw by the end of the 11th plan, higher than what the country added in the last three five-year plans. Besides, we have proposed capacity addition of 100,000 Mw in the 12th plan.
What are the challenges faced by the sector?
Availability of fuel — coal and gas — is a major challenge. However, the ministry is making all-out efforts to organise adequate supplies, both from domestic and global markets.
