Adani Energy Solutions QIP over-subscribed thrice, $1 billion raised

Adani Energy Solutions, the conglomerate’s transmission and distribution entity, on Tuesday said it has launched a qualified institutional placement (QIP). According to people privy to the matter, the company has raised $ 1billion from this round as the issue was over-subscribed thrice.

QIP is a fund-raising tool for companies, through which they issue equities, or other equity convertible securities to qualified institutional buyers.

In May, the company had approved plans to raise funds up to Rs 12,500 crore through the QIP route in the current financial year. And it was put to vote and approved at the company’s annual general meeting in June.

On Tuesday, the company said, its board has passed a resolution to authorise the opening of the issue on the same day. The statement further added, the board has approved the floor price for the issue at Rs 1,027.1125 per share. The statement said the company, at its discretion, can offer a discount of not more than 5 per cent on the floor price.

“Global investors including GQG, ADIA and domestic institutions Bandhan Mutual fund, Nomura were some of the participants,” according to sources in the know.

SBI Capital Markets Limited, Jefferies India Private Limited and ICICI Securities Limited have been appointed as the book running lead managers for the issue and Cantor Fitzgerald & Co. as advisors.

Past equity investments in AESL include investments from QIA in the company’s fully owned subsidiary Adani Electricity Mumbai in 2019 and GQG Partners in 2023 in AESL.

In its latest investor presentation, AESL highlighted it has raised US$ 700 million revolving facility and has an additional US$ 2 billion Global Medium-Term Notes program in place for its capex plans.

CRISIL Ratings in July in a note on the company said that AESL plans to incur significant capital expenditure under its transmission and smart meter business, and has nine transmission assets under various stages of implementation as of March with a combined project cost of Rs 17,000 crore.

The rating agency added, in the smart meters business, AESL is implementing nine contracts to install 22.8 million smart meters, which involves capital expenditure of Rs 12,300 crore.