Power Grid Corporation of India FPO Review (Subscribe)

Review By Dilip Davda on Nov 29, 2013

After its maiden IPO in October 2007, Power Grid Corporation of India Ltd. (PGCIL) is now entering with FPO. As per latest information, the FPO’s price band is fixed at Rs. 85-90 per share having a face value of Rs. 10 each. . The issue is opening on 03.12.13 and will close on 06.12.13. The purpose of the issue is to generate funds for transmission project and dilution of GoI stake. The total number of shares on offer are 78.70 crore including GoI’s stake sale of 18.51 crore share. Of the fresh shares, about 2.4 per cent will be reserved for the employees. This is the second follow-on offering from PGCIL that sold 10 per cent stake along with a similar stake divested by the government in November 2010 at an issue price of Rs 90 a share.

The issue is lead managed by SBI Capital Markets, Kotak Securities, Citigroup, ICICI Securities and UBS who are advising PGCIL on its FPO for 17 per cent stake sale, comprising 4 per cent stake dilution by Government and 13 per cent fresh equity by the company. 50 percent of the net issue is allocated to qualified institutional buyers (QIBs), 35 per cent for retail category and 15 per cent for high networth investors. In addition, 0.38 per cent of the issue is reserved for employees. Retail category and employees shall be given a discount of 5 per cent on the issue price. A discount of Rs 4.50 (which is 5 per cent of the top end of the price band) will be available to retail investors and eligible employees on the issue price on allotment. After the stake sale, the Government’s holding in PowerGrid will come down to 57.89 per cent from the current 69.42 per cent. Karvy Computershare is the registrar to the issue. Post allotment, the shares will be listed on BSE and NSE.
 
On secondary market front the PGCIL counter closed at Rs 95.05 on Friday on the Bombay Stock Exchange.


Conclusion / Investment Strategy

A good long term bet for all class of investors.

Reviewer recommends Subscribing to the issue.

Review By Dilip Davda on Nov 29, 2013

Review Author

DISCLAIMER: No financial information whatsoever published anywhere here should be construed as an offer to buy or sell securities, or as advice to do so in any way whatsoever. All matter published here is purely for educational and information purposes only and under no circumstances should be used for making investment decisions. Readers must consult a qualified financial advisor before making any actual investment decisions, based on information published here. Any reader taking decisions based on any information published here does so entirely at its own risk. Investors should bear in mind that any investment in stock markets is subject to unpredictable market-related risks. The above information is based on RHP and other documents available as of date coupled with market perception. The author has no plans to invest in this offer.

(SEBI registered Research Analyst-Mumbai).


About Dilip Davda

Dilip Davda, a freelance journalist

Dilip Davda is veteran journalist associated with stock market since 1978. He is contributing to print and electronic media on stock markets/insurance/finance since 1985.

Dilip Davda is a leading reviewer of public issues and NCDs in the primary stock market in India. The knowledge he gained over 3 decades while working in the stock market and a strong relationship with popular lead managers makes his reviews unique. His detail fundamental and financial analysis of companies coming up with IPO helps investors in the primary stock market. Dilip Davda has a special interest in analyzing the SME companies and writing reviews about their public issues. His reviews are regularly published online and in news papers.

Email: dilip_davda@rediffmail.com

Power Grid FPO 2 FAQs

  1. 1. Why Power Grid FPO 2?

    The initial public offer (IPO) of Power Grid Corporation of India offers an early investment opportunity in Power Grid Corporation of India. A stock market investor can buy Power Grid FPO 2 shares by applying in IPO before Power Grid Corporation of India shares get listed at the stock exchanges. An investor could invest in Power Grid FPO 2 for short term listing gain or a long term.

  2. 2. How is Power Grid FPO 2?

    Read the Power Grid FPO 2 recommendations by the leading analyst and leading stock brokers.

  3. 3. Power Grid FPO 2 what should investors do?

    Power Grid FPO 2 offers an opportunity to buy IPO shares before they get listed at the stock exchanges. Read the Power Grid FPO 2 Notes, Analysis and Recommendations by leading stock brokerage firms and experts in the above answer.

  4. 4. Is Power Grid FPO 2 good?

    Our recommendation for Power Grid FPO 2 is to subscribe.

  5. 5. Is Power Grid FPO 2 worth Investing?

    As per the analysis by our lead analyst Mr. Dilip Davda, we suggest you to subscribe to the Power Grid FPO 2.

  6. 6. When will Power Grid FPO 2 allotment status?

    The Power Grid FPO 2 allotment status will be available on or around [.]. The allotted shares will be credited in demat account by [.]. Visit Power Grid FPO 2 allotment status to check.

  7. 7. When will Power Grid FPO 2 list?

    The Power Grid FPO 2 will list on Thursday, December 19, 2013, at BSE, NSE.








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