PFC IPO Basis of Allotment

POWER FINANCE CORPORATION LIMITED
(A Govt. of India Undertaking)
(Incorporated on July 16, 1986 under the Companies Act, 1956 as a public limited company)
Regd. Office: 'Urja Nidhi", 1, Barakhamba Lane, Connaught Place, New Delhi 110 001.
Contact Person: Mr. J.S. Amitabh, Company Secretary,
Tel: +91 11 23456000. Fax: +91 11 23412545.
E-mail: ipo@pfcindia.com. Website: www.pfcindia.com

BASIS OF ALLOTMENT

PUBLIC ISSUE OF 11,73,16,700 EQUITY SHARES OF RS. 10 EACH FOR CASH AT A PRICE OF RS. 85 PER EQUITY SHARE (INCLUDING SHARE PREMIUM OF RS. 75 PER EQUITY SHARE) AGGREGATING TO RS 99,719.19 LACS (THE ISSUE"). THE ISSUE COMPRISED A RESERVATION OF UP TO 25,00,000 EQUTY SHARES FOR SUBSCRIPTION BY EMPLOYEES AND A NET OFFER TO THE PUBLIC OF 11,48,16,700 EQUITY SHARES OF RS.10 EACH FOR CASH AT A PRICE OF RS.85 PER EQUITY SHARE. THE ISSUE CONSTITUTES 10.22% OF THE FULLY DILUTED POST ISSUE PAID-UP CAPITAL OF POWER FINANCE CORPORATION LIMITED. ("COMPANY" OR "ISSUER").

THE FACE VALUE PER EQUITY SHARE IS RS.10. THE ISSUE PRICE PER EQUITY SHARE IS RS. 85
WHICH IS 8.5 TIMES THE FACE VALUE.

The Issue was made through the 100% Book Building Process wherein at least 50% of the net Issue was to be allocated on a proportionate basis to Qualified Institutional Buyers ("QIBs") (including 5% of the QIB portion that was to specifically be allotted to mutual funds), further, up to 15% of the Issue was available for allocation on a proportionate basis to Non-Institutional Bidders and up to 35% of the Issue was available for allocation on a proportionate basis to Retail Bidders, subject to valid bids being received at or above the Issue Price.

The Issue received 6,24,609 applications for 905,24,72,775 Equity Shares resulting in 77.16 times subscription. The details of the applications received in the Issue from Qualified Institutional Buyers, Non-Institutional Investors, Retail Individual Investors and Employees (Before technical rejections) are as under:

Final Demand
A sample of the final demand at different bid prices is as under

The Basis of Allocation was finalized in consultation with the National Stock Exchange of India Limited ("NSE") on February 19, 2007.

A. Allocation to Employees (After Technical Rejections)
The Basis of Allocation to Employees, who have bid at cut-off or at the Issue Price of Rs. 85 per Equity Share, was finalized in consultation with the NSE. The category was over subscribed 1.17 times. The total number of shares allotted in this category is 2500000 Equity Shares to 296 successful applicants. The category-wise details of the Basis of Allotment (Sample) are as under:

B. Allocation to Retail Individual Investor (After Technical Rejections)
The Basis of Allocation to the Retail Individual Investors, who have bid at cut-off or at the Issue Price of Rs.85 per Equity Share, was finalized in consultation with the NSE. The category was over subscribed 8.21 times. The total number of shares allotted in this category is 40185845 Equity Shares to 386023 applicants. The category-wise details of the Basis of Allotment are as under:

C. Allocation to Non Institutional Investors (After Technical Rejections)
The Basis of Allocation to the Non institutional Investors, who have bid at the Issue Price of Rs. 85 per Equity Share, was finalized in consultation with the NSE. The category was subscribed 48.18 times. The total number of shares allotted in this category is 17222505 Equity Shares to 1350 successful applicants. The category-wise details of the Basis of Allotment (Sample) are as under:

D. Allocation to QIBs
Allocation to QIBs has been done on a proportionate basis in consultation with the NSE. As per the SEBI guidelines, Mutual Funds were Initially allotted 5% of the quantum of shares available (28,70,418) and other QIBs and unsatisfied demands of Mutual Funds were allotted the remaining available Equity Shares (5,45,37,932) on a proportionate basis.

The Board of Directors of the Company at it's Meeting held at Hyderabad on February 19,2007 has approved the basis of allotment of Equity Shares in the Issue and has allotted the Equity Shares to various successful applicants.

The CAN-cum-Refund Orders and allotment advice and notices have been dispatched to the address of the investors as registered with the depositories. In case the same is not received within ten days, investors may contact at the Registrar to the Issue at address given below. The Refund Orders have been over-printed with the Bank Mandate details as registered, if any, with the depositories. The Equity shares allocated to successful applicants are being credited to their beneficiary accounts subject to validation of the account details with the depositories concerned. The company is taking steps to get the Equity Shares admitted for trading on the National Stock Exchange of India Limited and Bombay Stock Exchange Limited within seven working days from the date of approval of the basis of allotment.

INVESTORS PLEASE NOTE
This details of the allocation made would be hosted on the website of Registrars to the issue, Karvy Computershare Private Limited at www.karvy.com or http://kcpl.karvy.com
All future correspondence in this regard may kindly be addressed to the Registrars to the issue quoting full name of the First/ Sole applicant, Serial number of the bid-cum-application form, number of shares bid for, name of the Member of the Syndicate and Place where the bid was submitted and payment details at the address given below:

KARVY COMPUTERSHARE PRIVATE LIMITED
Unit PFC Plot No. 17 to 24,
Vitharao Nagar, Hitech City Road, Madhapur, Hyderabad 500 081.
Fax: 040-23420814, Email: pfc.ipo@karvy.com or mailmanager@karvy.com

TOLL FREE - HELPLINE NUMBER : 1 800 3454001

THE LEVEL OF SUBSCRIPTION SHOULD NOT BE TAKEN TO BE INDICATIVE OF EITHER THE MARKET PRICE OF THE EQUITY SHARE ON LISTING OR THE BUSINESS PROSPECTS OF POWER FINANCE CORPORATION LIMITED.