Sanjiv Goenka: Big plans

Calcutta, Dec. 7: CESC has raised Rs 600 crore through a qualified institutional placement (QIP) issue to fund its Haldia project.

The RPG Enterprises flagship has priced the shares at Rs 618, increasing the equity base by Rs 10 crore.

CESC stocks closed today at Rs 629.40, at a 2 per cent premium to the QIP offer price. The stock has gained 60 per cent in the last one month.

Fidelity, the Singapore government and Goodman were among the clutch of investors who queued up for the heavily oversubscribed offer.

“We have got a very good response from quality investors. They sought much more than what we could offer,” CESC vice-chairman Sanjiv Goenka said today.

The company will use the resources to finance the first phase of its Haldia power project.

It plans to set up a 600MW plant in the first phase and has already bought land for it.

The project requires an investment of Rs 2,500 crore, which will be funded through Rs 1,500 crore of debt and Rs 1,000 crore of equity.

Goenka said he expected to reach financial closure of the project by tying up the debt part by March. After the fresh issue of about 1 crore shares, the promoters’ stake would come down to 53 per cent from 56 per cent now.

The company has received necessary coal linkage from Coal India Ltd for the Haldia project.

CESC plans to set up a 2,000MW plant to meet the growing demand of Calcutta.

It has also signed MoUs with the Jharkhand and Orissa governments for a 2,000MW and a 1,000MW plant, respectively. Considering all the projects, the company will make around Rs 20,000 crore worth of investment over the next few years.

Earlier this year, the group merged its retail venture Spencer’s with CESC.

Tyre plant

The RPG group will set up a tyre manufacturing plant to raise its total capacity. It has zeroed in on two sites in Maharashtra for the unit.

“Ceat will set up tyre manufacturing plants to expand its capacity and to develop radial capability. The group has finalised Patalganga and Ambernath as possible locations,” RPG Enterprises’ chairman Harsh Goenka said.

“A plant will be set up with an investment of Rs 500 crore at Patalganga or Ambernath by 2008-09,” Ceat managing director Paras K. Chowdhary said.