Reliance Power To Hit IPO Stands

With markets on a roll Anil Ambani has made quite a killing not just for himself but for investors as well. Now he is planning a new Initial Public Offering (IPO) for his power subsidiary and as expected it is going to be in billions. Reliance Energy plans to increase its capacity to 25,000 MW over the next 5-7 years. To fulfill its ambition the company is now seeking helping an hand from Dalal Street. According to sources Reliance Energy is planning an IPO for its subsidiary Reliance Power. The company plans to file DRHP of Reliance Power soon and is planning to raise $2.5-3 billion. It has also appointed Enam, JM Financial, JPMorgan, Kotak and UBS as merchant bankers.

Reliance Power has been asked by the government to hand over Sasan project within the next four years. The estimated cost for Sasan project is seen at Rs 20,000 crore. The buck does not stop here, the company has also lined up some mega investment plans. Reliance Power is planning to invest Rs 40,000 crore in ultra mega power projects. It is actively considering to-bid for 4,000 MW Krishnapatnam project also. Reliance Energy stock has gained 148 per cent in the last one year outperforming the benchmark indices by a wide margin. Brokerages after the sharp run-up have turned cautious. However many believe there is huge potential of value unlocking within the stock if the management decides to hive off EPC business into separate entity.