POWER on. India on. Rel Power IPO sells 10 times over - 1 + 1 = 100: Mukesh & I’ve proved that

On the dot of 10 am, bidding was opened to those interested in the IPO. The hysteria that followed was staggering. Sixty seconds later, at 10.01 am, the issue was oversubscribed two times over and Rs 23,400 crore from the system had found its way into the IPO. Clearly, this wasn’t the marathon Anil Ambani had been training for — it was a mad sprint. For the next five hours, each minute was witness to Rs 336 crore being pumped into the issue. By 9 pm, when bidding closed for Day 1, the issue was oversubscribed 10.64 times and investors had committed Rs 1.09 lakh crore to Reliance Power — roughly $25 billion. To get a sense of what these numbers really mean, they ought to be juxtaposed with what the government managed to garner during the year (see box). Close to 98% of those who bid for the IPO were willing to pay Rs 450 a share — the upper limit. If the stock eventually lists at this price, and other things remain the same, Anil may overtake older brother Mukesh as the richest Indian. The latter’s net worth is around Rs 2.15 lakh crore as against Anil’s 1.83 lakh crore. One question remains: what explains the euphoria to invest in a company with net profits of Rs 16 lakh? “I think it is confidence in the India story and a tribute to Dhirubhai Ambani, father of the Indian capital markets,” said Anil.

excerpts from TOI

AT 4.30 PM IN RELIANCE CENTRE, THE headquarters of the ADAG group in Mumbai, Anil Ambani has run the course a few days ahead of the Mumbai Marathon — and in record time. So what does he have to say about India's largest-ever IPO? “Gone in 60 seconds,” says Ambani Jr, walking around the room strutting his stuff (Rs 110,000 crore, no less). Dressed in ETpink shirt, grey trousers and black moccasins, Anil Dhirubhai Ambani can barely hide his euphoria: “If you ask me, this is the beginning of the ADAG group,” he says, amidst congratulatory phone calls and smses. He gets emotional, often angry at the happenings of the past few years: “From being called an underdog to not be in the reckoning at all... to being a big zero... I’ve heard every bit of trash in 2005 (at the time of the demerger),” he told ETover a leisurely tetea-tete soon after the issue was oversubcribed many times over. “It’s a fitting answer to all my detractors... To shut them up.”

POWER on. India on. That’s the ad slogan for Reliance Power. On Tuesday, as India’s largest initial public offer received an overwhelming response on day one of subscription, it seemed to be a case of ‘Reliance Power on, Dalal Street off’. The 22.85-crore share mega issue, looking to raise roughly Rs 11,000 crore, was fully subscribed under a minute of the start of bidding, making you wonder if there were any early-bird prize on offer. At last count, bids for more than 10.5 times the issue size had been received. But the electrifying reception to the IPO plunged the rest of Dalal Street into darkness.

excerpts from ET

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