Rel Power to pay back institutional bidders | india | Hindustan Times
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Rel Power to pay back institutional bidders

india Updated: Jan 23, 2008 22:29 IST
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Reliance Power Ltd has written to the Securities and Exchange’s Board of India (SEBI), on Tuesday, offering to make an early allotment and refund of the application money deposited by qualified institutional bidders towards its initial public offering, sources close to the development said. It could release around Rs 2 lakh crore within this week and boost the fortune of at least three major public floats.

A little less than 500 qualified institutional bidders or QIBs had applied for the issue and they had to submit 10 per cent of the value of shares applied for at the time of application. The QIB portion constitutes 60 per cent of the IPO. Reliance Power had received Rs 50,848 crore from QIBs towards this. The news comes on the backdrop of the largest ever two-day correction on the Indian bourses and a reported rush to stop payments on Reliance Power IPO applications.

Timely refunds are crucial as fortune of several IPOs slated to open later this month depend on unlocking of liquidity sucked in by the R Power IPO. The second largest real estate IPO so far, Emaar MGF issue plans to raise Rs 7080 crore and the issue is open from February 1 to February 6. Wockhardt Hospitals and the Rs 1,200 crore issue from IRB Infrastructure are slated to open on January 31.

With over-subscription in the QIB section being around 80 times the company would be in a position to refund around Rs 40,000 crore. The refund of the money will also release another Rs 1,56,000 crore blocked from foreign institutional investors who had applied through participatory notes.

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