Indian IPO

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Wednesday, March 29, 2006

Reliance Petro IPO likely to open on Apr 10

Reliance Petroleum, RPL, the wholly owned subsidiary of Reliance Industries, is likely to unveil its initial public offering, IPO, on April 10, reports Business Standard.

RPL, which is raising funds to part-fund its Rs 27,000 crore (Rs 270 billion) refinery at Jamnagar in Gujarat, plans to begin its international road shows during the week beginning April 3, 2006.

The entirely book-built IPO is expected to be introduced within a price band of Rs 57 to Rs 62.50.

Sources in the investment banking industry said road shows were being planned in cities including Hong Kong, Singapore, London, Boston, New York and San Fransisco.

Reliance Industries Chairman Mukesh Ambani is expected to attend a couple of road shows, they added.

Stock market sources said going by the huge response of the pre-IPO private placement, RPL’s IPO might break the previous record of investors’ participation in a public float. National Thermal Power Corporation had set a record by attracting 15 lakh applications for its public issue in October, 2004.

A clutch of investors including Blackstone, Citigroup, UBS, Deutsche Bank, UTI Bank, SBI, ICICI and IDBI and Mukesh Ambani, were learnt to have scooped up 450 million shares in the pre-IPO private placement.

The institutions were believed to have purchased shares at Rs 60 a piece, totaling an investment of Rs 2,700 crore (Rs 27 billion). A formal announcement of this is expected shortly.

Incidentally, Reliance Industries had invested Rs 2,700 crore (Rs 27 billion) in RPL as its equity contribution in three tranches in December, January and February.

The IPO will offer 1,800 million shares. Reliance would again acquire 900 million shares through the IPO, exactly the same amount to be offered to the public. As the pre-IPO placement consumed 450 million shares, the public would be entitled to apply for 450 million shares.

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