Sterlite Power Transmission Ltd, backed by the Vedanta Group, is planning to get a whopping funds of $300 Million from GIC. It is part of Sterlite's internal restructuring process in which it inducts GIC, a Singapore-based sovereign wealth fund, as a strategic partner. The step is taken to boost the business growth and expand its market share in the power transmission sector.
Investors planning to buy Sterlite Power unlisted shares must also know the company's business expansion plans in the future. It will give you a better idea of the predicted growth in its pre-IPO share value. This blog will discuss Sterlite Power Transmission Ltd's business expansion plans in detail.
Sterlite Power Transmission Ltd To Get $300 Million Funding From GIC
According to the latest report of Money Control, Sterlite Power Transmission is in talks with GIC to be a strategic partner in the power transmission business. It is also reported that Sterlite also looks for a $300 million cash infusion for expansion. Sterilite is also a sponsor of IndiGrid, which is listed on the stock exchange. There are also rumours that Sterlite plans to demerge the solutions business and then be listed on the domestic bourses.
According to the company's officials, "GIC is not keen on exposure to the solution business. GIC will invest $300 million as part of a joint venture with Sterlite Power transmission." In addition, Avendus Capital and Deutsche Bank are engaged in making this deal successful. Since Sterlite Power Transmission business model is diversified it allows the company to maintain consistent business growth in the last 5 years.
The funding from the GIC will be crucial for Sterlite Power in terms of expansion plans and preparation for an IPO.
Possible Business Expansion Plans Of Sterlite Power Transmission Ltd
The business expansion plans of Sterlite Power Transmission include strengthening its global infrastructure business. GIC has a high interest in its infrastructure design, which has the potential to generate high revenue in the next few years. Recently, Sterlite acquired Fatehgarh III Beawar Transmission Project in Rajasthan to extend its portfolio.
In the future, we can expect Sterlite to participate in the bidding process and acquire government and private-based power transmission projects. Here are the possible business expansions of Sterlite Power Transmission Ltd:
Extend Order Value
The major revenue of Sterlite Power Transmission Ltd comes from its power transmission projects. As per the report shared by Sterlite, it secured new orders worth Rs 1400 crore in the last quarter of FY23. The company secured these orders from domestic and international markets, strengthening Sterlite's total order book value. The company will aim to extend this order value and get the big power transmission and infrastructure development.
Targets Renewable Energy Projects
The world is shifting from fossil to renewable energy to save the environment. Sterlite Power Transmission Ltd has future plans to target renewable energy projects that will meet its green-energy goals in the next 5 years. The company has eyes on green energy projects worth Rs 70,000 crore, for which it will participate in the auction process soon.
Strengthen Its Transmission Infrastructure Business
The transmission infrastructure is the second largest business segment of Sterlite Power Transmission. Since it gets a cash infusion of $300 million from GIC, it is expected that the company will work on strengthening its transmission infrastructure business.
In the past, the company also acquired back around 29% of stakes in its transmission infrastructure business from Standard Chartered Private Equity(SCPE). The goal of Sterlite is to strengthen this business segment and look for future growth opportunities.
Apart from this, Sterlite Power Transmission will also aim to improve its business performance in the unlisted shares market. The financial performance of Sterlite Power pre-IPO shares remained normal compared to its business growth. Its PAT was negative in the last fiscal year, which concerns its investors.
Invest In Sterlite Power Transmission Ltd With Stockify
Sterlite Power Transmission Ltd has a profitable business model with a high success rate in completing various transmission projects. The company moved towards its business growth with funding from GIC. Being an unlisted company, Sterlite remains in the limelight. Investing in Sterlite Power Transmission Ltd is beneficial as the company has clear business growth plans.
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FAQs
1- What is the demerger ratio of Sterlite Power Transmission Limited?
The demerger ratio of Sterlite Power Transmission Ltd is 5:1, which means for every 5 equity shares held in Sterlite, shareholders can receive one equity share of Rs 2 each.
2- Will Sterlite Power Transmission get benefits from GIC funding?
The funding of $300 Million from GIC will be helpful for Sterlite Power in terms of business growth. It plans to extend its order value and participate in the bigger tender that will be issued in the coming years.
3- What is the current Sterlite Power Transmission share price?
As per the fresh market data, the current Sterlite Power Transmission share price in India is Rs 615 per equity share. To stay updated with its future unlisted share price, subscribe to Stockify.
4- How can I invest in Sterlite Power Transmission Ltd?
You can invest in Sterlite Power Transmission Ltd via its unlisted shares available in the grey market. On Stockify, you will get complete details of Sterlite Power Transmission pre-IPO shares and financial performance for the various financial years.
5- When Will Sterlite Power Transmission IPO Release?
There is no confirmation from the company's side regarding the Sterlite Power Transmission Ltd IPO. You can use Stockify to check future updates regarding Sterlite IPO and other news.
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