Ind-Barath to raise funds through PE

Hyderabad-based Ind-Barath Power is looking to raise Rs 1,000 crore through private equity, after the company shelved its plans to go public due to volatile market conditions.

The company is in discussions to raise the money through a private equity deal of almost the same fund size that it had initially planned to raise through an initial public offer, said a person privy to the development. The company did not respond to an e-mailed questionnaire on the issue.

In June 2010, the company had filed a draft red herring prospectus which has expired. It was planning to raise around Rs 1,100 crore. Ever since the markets have been volatile, many companies deferred their plans to go public. “L&T Finance has recently received a good response to its IPO, but the current low valuations of listed power and infrastructure companies are a damper,” say experts.

The company which planned to use the proceeds of the IPO for expanding its power generation capacity is now in need of equity for its projects, which are in various stages of development. It is operating a power capacity of around 300 megawatts.

It has three power plants with a combined generation capacity of 1,337.5 megawatts. The company is developing a 700 megawatt coal-based power project in Jharsuguda, Orissa. The first unit is expected to be commissioned by January 2012.

Ind-Barath is also implementing a 660 megawatt power project at Thoothukudi, Tamil Nadu, that is expected to be commissioned by December 2013. It is developing yet another 300 MW power project in Tamil Nadu, where it has targeted a first unit generation to start by March 2012. It also has a small hydro power project in its kitty with a five megawatt capacity.