Mohinder Verma
JAMMU, Nov 18: The Jammu and Kashmir State Power Development Corporation is all set to initiate first step towards entering the stock market by signing an agreement with the Power Finance Corporation (PFC) within next 10-15 days. The decision to enter the stock market has been taken to raise substantial equity through Initial Public Offer (IPO) for generation of 6000 Mega Watts of electricity by tapping available water resources of the State.
Official sources told EXCELSIOR that Board of Directors has already given nod to the State Power Development Corporation’s entry in the stock exchange by floating Initial Public Offer (IPO), which is being considered as most viable option to raise huge equity required for generation of 6000 Mega Watts of electricity during the next 10 years by constructing various power projects.
“All the formalities have been completed for engaging Power Finance Corporation (PFC) as Transit Advisor to go through the entire process of entering the stock market”, they informed, adding “an agreement between Jammu and Kashmir State Power Development Corporation and PFC is all set to be signed within next 10-15 days”.
When contacted, Managing Director of Jammu and Kashmir State Power Development Corporation Basharat Ahmad Dhar confirmed that an agreement is being signed with PFC very shortly. “The documents are ready and only a date has to be finalized for signing the agreement”, he added.
“The Power Finance Corporation, which is having good business relations with us, has also agreed to provide Rs one crore assistance to make all necessary arrangements, which are pre-requisite for ensuring listing of Power Development Corporation in the stock market”, he said, adding “the remaining Rs 39 lakh expenditure to be incurred to go through the process of entering the stock market would be borne by the Corporation”.
In response to a question, the Managing Director said, “the entire exercise which the PFC will carry out during the next one year would culminate into appointment of Merchant Banker which will help us to enter the stock market and float IPO”, adding “with this Jammu and Kashmir State Power Development Corporation would be second listed company from the State after Jammu and Kashmir Bank Limited”.
Replying to another query, Basharat Ahmad said, “during the next 10 years we are planning to generate 6000 Mega Watts of electricity by constructing various projects and for this JKSPDC would require Rs 15,000 crore equity—Rs 1500 crore every year and entering stock market is the only viable option to raise substantial equity for implementation of power projects”. He said that Corporation was also taking several other measures to improve its financial health.
“For execution of various projects the REC has also offered to sign agreement with us and we are examining the options before taking decision”, the Managing Director of JKSPDC disclosed.
It is pertinent to mention here that work on 450 Mega Watts Baglihar Hydroelectric Project-II is in progress while as decks have already been cleared for allotment of Parnai project. Five projects have been awarded to various Independent Power Producers (IPPs) under Hydel Policy-2011 which include Ans-I, Bichlari, Kanzil Wangath, Girjan Di Gali and Chandanwari, which were bid out in October last year.
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