Reliance Power Ltd, part of the Reliance Anil Dhirubhai Ambani Group (RADAG), will generate over 28,000 MW of electricity by building 13 projects in the next 6-7 years with an investment of $28 billion.
Lalit Jalan, director, Reliance Power, told a news conference in Hyderabad on Monday that the Indian electricity sector offered huge opportunities as the demand for energy was expected to grow by eight per cent during the 11th plan period (2007-12) and by nine percent during 12th year plan period (2012-17).
"There are huge shortages in India. Four hundred million Indians don't have access to power. The per capita consumption in India is 600 units per annum, which is less than one-fourth of the world average of 2,500 units," Jalan said.
With India setting a target of nine to 10 per cent growth, it needs more electricity. "The supply will fuel demand. Industry after industry will increase consumption," he said.
The per capita consumption of power in India is also one-third of China's per capita consumption of 1,684 units. The total installed capacity in India is 132,000 MW, which is a quarter of China's installed capacity of 622,000 MW.
"The low penetration offers us tremendous opportunity," he said.
The 13 projects Reliance Power plans to build will be diverse in geographic location, fuel type, fuel source and off-take.
The projects, including seven coal-fired, two gas-fired and four hydroelectric, will come up in six states.
Suresh Nagrajan, head, project development, Reliance Power, said the company was also looking at acquiring mines in Indonesia and Australia for the supply of coal to the 4,000-MW Krishnapatnam project. He said 40 percent of the electricity to be generated from this project would be supplied to Andhra Pradesh.
For the first phase covering six projects, the company is entering the capital market with its initial public offering of 260 million equity shares of Rs.10 each.
The issue will open on Jan 15 for four days on the price band of Rs.405 to Rs.450 per share. A discount of Rs.20 will be offered to retail investors.
Jalan said the issue comprised a net issue to the public of 228,000,000 equity shares and a promoters' contribution of 32,000,000 equity shares.
The company plans to raise Rs 103.93 billion ($2.64 billion) to Rs.115.63 billion ($2.94 billion) through the country's largest public issue.