Tuesday, November 24, 2009

JSW Energy IPO - Analysis, Recommendation and Review

JSW Energy has come out with an IPO of Rs. 2700 crore. The issue will open for subscription on 7th December and close on 9th December, 2009. The offer price of the issue is between Rs. 100 to Rs. 115.

The company intends to utilize the IPO proceeds to partially finance construction and development of the identified projects aggregating to 2790 MW in capacity;400 KV transmission project and mining venture, and for repayment of corporate project.

Watch out this blog for more details, subscription, allotment and listing!

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2 comments:

No update till 11 pm on 04 Dec. What are your recommendations or are you waiting for initial investor response before shaping your recommendations?

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We would recommend this IPO for mid to long term investors. This is a good company and the IPO price is also justified. JSW Energy has good track record with its 260MW operational power plant. In H1FY2010, the company commissioned two more plants and this is reflected in the strong growth of H1FY2010 numbers, when the sales were up by 42% and the PAT went up by 98%. In FY2008, the PAT is reinstated at Rs 324 crore mainly on account of sale of CERs of Rs 327.6 crore, which pertained to 2001-2006 period.

While comparing with other power utilities, JSW Energy looks fairly priced both in terms of P/B as well as market cap/MW basis. However, JSW Energy is having clear revenue visibility at least from the 995MW operational capacity. Also, another 2,280MW capacity coming up within 18 months would provide further boost to its near future revenue stream.

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