India: Adani Transmission plans to raise up to $422m via QIP

Photo: Reuters

Adani Transmission Ltd plans to raise up to ₹3,000 crore through a soon-to-be-launched qualified institutional placement (QIP) offering, said two people aware of the development, requesting anonymity.

“Adani Transmission has been preparing to launch an equity share sale through a QIP offering. They have appointed five investment banks—Kotak Mahindra Capital, Citi, Credit Suisse, Edelweiss and JM Financial—to manage the share sale. They plan to raise around ₹3,000 crore, though they have an approval to raise up to ₹5,000 crore,” said the first person cited above. The company is looking to complete the fundraising by the end of this quarter, the person added.

QIP is a capital-raising tool through which listed companies can sell their equity shares, fully and partly convertible debentures, or any other securities, barring warrants, that are convertible into stocks, to a qualified institutional buyer.

In August, shareholders of Adani Transmission approved a plan to raise up to ₹5,000 crore through an equity share sale.

According to the second person cited above, Adani Transmission will use the capital for a variety of purposes, including debt reduction, capex and to invest in future acquisition opportunities.

“The company has not finalised any plans for equity raise. It continues to explore all possible options for accretive growth and for creation of long-term shareholders value,” an Adani Group spokesperson said in an email response to Mint’s queries.

Citi and Credit Suisse declined to comment.

Emails sent to Kotak Mahindra Capital, Edelweiss and JM Financial remained unanswered.

Adani Transmission is at present India’s largest private power transmission company with a cumulative network of around 12,923 circuit (ckt) km, out of which approximately 10,357 ckt km is operational, while 2,566 ckt kms are under construction.

Last year, Adani Transmission had acquired Reliance Infrastructure’s integrated business of retail electricity distribution, transmission and generation.

The business included Reliance Infra’s power generation units in Dahanu, power transmission network across Mumbai and Maharashtra, and the retail power distribution network in Mumbai suburbs.

The distribution business serves more than three million customers across 400 sq. km.

The acquisition marked the firm’s foray into large-scale electricity distribution.

In 2018, it had also signed agreements to acquire KEC International’s 100% stake in KEC Bikaner Sikar Transmission Pvt. Ltd which had operational transmission lines aggregating to 344 ckt km.

For the first half of 2018-19, it reported revenue of ₹1,658 crore, against ₹972 crore in the first half of the previous fiscal year.

The company reported profit of ₹265 crore in the first half of 2018-19, compared with profit of ₹151 crore in the corresponding period of the previous year.

On Tuesday, Adani Transmission shares fell 1.62% to ₹219.3 apiece on the BSE while the benchmark Sensex rose 1.3% to end the day at 36,318.3 points.

Also Read:

India: High quality IPOs, QIPs to witness strong investor appetite in 2019

This article was first published on livemint.com

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.