Nov 30, 2010 (LBO) - Panasian Power Limited, a unit of Malaysian based Majulia group is selling 200 million shares to raise 600 million rupees in an initial public offering which will open on December 07, officials said.
Majulia owns the firm through its energy unit, Power Hub International (PHI).
Panasian Power owns a 2.0 MegaWatt mini-hydro plant in Sri Lanka's Ratnapura district and has a power purchase agreement with state-run Ceylon Electricity Board which runs till July 2019.
Panasian has consistently generated more than 10 GigaWatt-hours (millions of units) of energy a year since 2005 at a plant factor of more than 60 percent, which officials say is the second highest in the country.
The plant factor measure the actual output against the total possible in a period, with the plant running at full capacity.
In 2009 the plant has generated 10.7 GWh of energy (61.3 percent plant factor), in 2008 11.2 GWh (61.1 percent plant factor).
Up to September 2010, the firm has generated 7.7 GWh of energy.
The firm is paid on the so-called 'avoided cost' formula which is based on the thermal costs of the CEB. Director Rifky Badurdeen says in the past the price has risen about 5.0 percent a year.
The CEB is however commissioning a coal plant which will generate power at 8.04 rupees a unit but officials says they do not expect tariff reductions in the near future.
In the year to March 2010 it has earned 118.0 million rupees and profits of 77.9 million rupees. Panasian has a tax holiday running till 2017/2018.
Director Deepal Sooriyaarachchi says firm has received preliminary approval from the CEB to increase the plant's output by one MegaWatt to 3.0 MW.
Director Rifky Badurdeen says the firm is hoping to sign an enhanced power purchase agreement within three months.
Panasian's newly acquired subsidiary Mawanella Power with a 2.4MW plant has a lower plant factor. In 2009 it has generated 4.7GWh of energy at a plant factor of 22.4 percent.
In the first six months of 2010 the plant has generated 5.0GWh of energy at a plant factor of 32.7 percent.
In the year to March 2009 the firm has earned 34 million rupees in revenues and lost 45 million rupees.
In the year to March 2010 the firm earned 70.9 million rupees in revenues and 20.1 million rupees in profits, with interest costs falling to 10.2 million rupees from 34 million rupees. It has a tax holiday till 2013/14.
The plants are currently paid 11.07 rupees during the so-called 'wet season' and 11.94 rupees during the 'dry season', under the formula.
After the issue, the parent, Panansian Power will have 500 million shares indicating earnings per share of 19 cents last year.
source - www.lbo.lk
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