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The President of India acting through the Ministry of Power to divest 5% in NTPC, FPO opens on February 03

14th Jan, 2010

MUMBAI, Jan 14: India’s largest power generation company NTPC Limited (Company) will enter the capital markets on February 3, 2010 with its further public offer (FPO) of 412,273,220 equity shares of Rs 10 at prices to be determined through an alternative book building process under part D of Schedule XI of the SEBI (Issue of Capital and Disclosure Requirements) Regulations 2009. The FPO will close on February 5, 2010.

NTPC Limited has filed the Red Herring Prospectus with the regulator Securities Exchange Board of India to this effect.

The floor price and the minimum bid lot for the Offer will be decided at least one day prior to the opening of the offer. Of the FPO, a total of 4,273,220 equity shares are reserved for NTPC employees.

The Offer marks a divestment of 5% in NTPC Limited by the President of India acting through the Ministry of Power. Prior to this Offer, the GoI owned approximately 89.5% of NTPC’s Equity Share capital. The FPO proceeds will go the President of India acting through the Ministry of Power. ICICI Securities Limited, Citigroup Global Markets India Private Limited, J.P. Morgan India Private Limited and Kotak Mahindra Capital Company Limited are the Book Running Lead Managers to the Offer and Karvy Computer Share Private Limited is the Registrar.

As of September 30, 2009, the Company owned installed power generating capacity was approximately 18.6% of India's total installed capacity. In Fiscal 2009, the Company contributed 28.6% of the total power generation of India. (Source: CEA). In 2009, NTPC Limited was the top independent power producer in Asia, and ranked second in the world, on the basis of asset worth, revenues, profits and return on invested capital, according to a study conducted by Platts, a division of the McGraw-Hill Companies.

As of September 30, 2009, the Company’s total installed power generation capacity was 30,644 MW, including 28,350 MW of generation capacity through 112 units owned by NTPC Limited and approximately 2,294 MW of capacity through two joint venture companies. Of the Company’s owned capacity, 86.0% is coal-based, operated through 15 coal-based power stations, and 14.0% is gas-based, operated through seven gas-based power stations (including one naphtha-fired station). In Fiscal 2009, the Company generated 206.9 billion units of electricity through its owned stations.

The Government of India has identified infrastructure inadequacy as a significant constraint in realizing India’s economic growth objectives. In particular, the power sector has been recognized by the GoI as a key infrastructure to sustain economic growth. Under the Eleventh Plan, the power sector is expected to attract 30.4% of the total investment in infrastructure during the Eleventh Plan.

Of the total expected investment of Rs.7,253.33 billion in electricity, Rs. 4,034.76 billion (56%) is expected to be invested for generation, Rs.1,520.77 billion (21%) for transmission and Rs. 1,697.22 billion for distribution. (Source: Projections of Investment in Infrastructure During XI Plan: Planning Commission.)
 

NOT FOR DISTRIBUTION IN THE UNITED STATES.

“NTPC Limited is proposing, subject to market conditions and other considerations, a further public offer of its equity shares and has filed a Red Herring Prospectus with the Registrar of Companies, NCT of Delhi and Haryana, the Stock Exchanges and the Securities and Exchange Board of India (“SEBI”) . The Red Herring Prospectus is available on the website of SEBI at www.sebi.gov.in and the respective websites of the BRLMs at, www.icicisecurities.com, www.citibank.co.in, www.jpmipl.com, www.kmcc.co.in. Investors should note that investment in equity shares involves a high degree of risk and for details relating to the same, see the section titled “Risk factors” of the Red Herring Prospectus.”

“These materials do not and shall not constitute an offer to sell or the solicitation of an offer to buy the Equity Shares in the U.S. or else where. The Equity Shares may not be offered or sold in the U.S. absent registration or an exemption from registration under the U.S. Securities Act of 1933, as amended. Neither the company nor the selling shareholder intends to register any portion of the offering in the U.S.or to conduct a public offering of the Equity Shares in the U.S."

"This press release shall not constitute an offer to sell, or the solicitation of an offer to buy, any securities, nor shall there be any sales of securities mentioned in this press release in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction."


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