State-owned National Thermal Power Corporation is likely to hit the market with a maiden public offer for shares in the first week of August, targeting to raise up to Rs 2,000 crore (Rs 20 billion).
NTPC is hoping to get the green signal from market regulator Securities and Exchange Board of India by July 15, based on the draft red herring prospectus submitted about a week ago, company sources said.
Asked about the premium expected, sources said it would be decided only after the pre-market survey and the roadshows to be carried out by the lead managers and financial advisors along with company officials.
They, however, indicated the book value of a NTPC share of Rs 10 face value was hovering around Rs 45 with an earning per share of Rs 6.
According to analysts, with strong fundamentals, NTPC could raise up to Rs 2000 crore for 5 per cent equity at Rs 432 crore (Rs 4.32 billion).
It has planned to offer 50 per cent of the shares to Qualified Institutional Buyers, while the rest would be allotted to high net worth individuals and retail in equal proportion of 25 per cent.
Sources also said NTPC was in favour of increasing the quota for retail investors.
About NTPC's plan to raise only 5 per cent of its equity, sources said it was decided based on the number of projects in hand.