Jaiprakash Hydro's IPO

Jaiprakash Hydro's IPO may be priced at Rs 27-32

The initial public offering of Jaiprakash Hydro-Power (JHPL) is likely to be priced in the band of Rs 27-32 per equity share. The group's holding company, Jaiprakash Associates, which currently holds its entire equity, has put up around 36% for sale.

The issue, which will be offered through the book-building route, is expected to hit the market on March 22. The shares will have a face value of Rs 10 each. The proceeds from the IPO will be used to fund company's upcoming mega hydro projects.

Any opinion on this one??
Jaiprakash Hydro-Power Limited is the kind of stock not commonly encountered on the Indian market safe and guaranteed returns but few growth prospects by and large, a utility company.

Given the nature of the stock, it may be interesting for a very long-term investor looking for stable returns over a long period.

Jaiparkash Hydro Power Limited (JHPL) owns and operates India's largest hydropower plant in the private sector at BASPA-II (300MW) in Himachal Pradesh since June 2003.

The plant will generate 1.3 billion KWh of power annually, including the 12 per cent power that the company will be supplying to the State Government, to help meet the projected demand of the northern grid.

The entire power is being purchased by the Himachal Pradesh State Electricity Board.

Talking to presspersons here on Monday, Mr Jaiprakash Gaur, Chairman of the company, said there were plans for the company to foray into power distribution, apart from consolidating its generating capacities.

The company is setting up another 400 MW hydro-power project in Vishnuprayag in Uttaranchal, which is scheduled to be commissioned in June 2006, apart from a 1,000 MW project at Karcham on River Sutlej in Himachal Pradesh.

The group is targeting a capacity of 700 MW in the hydro power sector by 2006 and 1,700 MW by 2010.

Mr Gaur pointed out that the country held out enormous potential in this sector, with the Government proposing to add 41,000 MW and 59,000 MW of power in the Tenth and Eleventh Plan Periods respectively. "This means 10,000 MW of power will have to be added every year," he said.

According to him, the Tenth Plan period envisages the highest addition of capacity in the hydro-power sector. "During this Plan, some14,393 MW of hydro-power is proposed to be added. And we are associated with 54 per cent of this," he said.

The power purchase agreement (PPA) between the Himachal Pradesh State Electricity Board (HPSEB) and the company, provides for a fixed return of 16% per annum on the equity capital.

The PPA is for an initial period of 40 years, extendable for a further period of 20 years on the same terms and conditions.

During the year ended March 31, 04, the company reported net sales of Rs 295 crore and net profit of Rs 57.9 crore.

The PPA also provides for reimbursement of the fixed costs, such as depreciation and interest as well as variable costs of operations and maintenance, interest on working capital, income tax and foreign exchange fluctuations.

The agreement further provides for reimbursement of escalation in costs of operations and maintenance subject to certain limits.
A comment from a beginer here.
Company appears to be on strong fundamentals.. I think it will perform good in the market... opening of ~ 50-60 Rs can be expected.

even i've subscribed for some 600 shares!!!! so any idea abt the allotment for me..

by the way wat is green shoe option.....
Re Jaiprakash Hydro

The listing of stock has been made and in this downtown market month the share will bottom out and policy of the goverment for power tariff could adversly bring the power company to a lacklustre attention of the brokers fraternity with
company of good results. The company script is good pick inspite reservation for many s view on skill of managment excel.Inference we can have well deserved pick lower than IPO.
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I have purchased 1000 shares of Jaiprakash Hydro @Rs.32/ and the way the analysts are projecting about the stock saying it is highly overprised I am worried if the stock will perform. Kindly I need some good advice.
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