NEW DELHI: Shares of Indian Energy Exchange (IEX) made a tepid debut on BSE on Monday, as the scrip got listed at Rs 1,500, a 9.09 per cent discount to its issue price of Rs 1,650.
The stock has been admitted to the ‘B’ group of securities on the exchange. At the issue price of Rs 1,650, the stock was valued at 43.5 times FY17 EPS.
The issue, which was sold between October 9 and October 11, had been subscribed 2.28 times. The company, which sold the shares in the price range between Rs 1,645 and Rs 1,650 had cut anchor investor allocation to 7,89,120 shares from 18,19,501 announced earlier.
Lack of clarity on whether foreigners are allowed to invest in the IPO of a power bourse was cited as the main reason, said four people familiar with the matter told ET.
Experts noted that IEX enjoys a dominant position in the electronic platform of short-term domestic power market. They expect the exchange to deliver higher revenue and profit, given the strong growth potential.
Government initiatives like rural electrificationBSE -0.54 %, power for all and UDAY are likely to drive short-term power market volumes, they said, which could result in an expected share of 21.1 per cent by FY22.
Energy trading is at a nascent stage in India with only 3 per cent of market volume being traded on the exchange compared with 30‐35 per cent in developed countries.
The company has generated a return on equity (ROE) of 30.8 per cent against the Multi-Commodity Exchange’s 7.4 per cent, based on FY18 annualised earnings.
By 2022, the capacity of the renewable energy segment is expected to reach 170GW from 58.3GW at present. Of this capacity, 100 GW is solar energy, while 60 GW is wind energy. Since wind and solar energy generators are highly dependent on local conditions, it is expected that power generators would rely on the short-term power market.
Source: economictimes.indiatimes
