14% Discount on Reliance Power shares worth Rs 1,524.60 on Monday’s closing price

Reliance Power Ltd’s shares came into focus on Tuesday morning after Anil Ambani- led company declared preference shares worth Rs 1,524.60 crore at a price of Rs 33 per share, which appeared to be on 14 per cent discount on Monday’s closing price. Promoter Reliance Infrastructure Ltd and non-promoter entities Authum Investment and Infrastructure Ltd and Sanatan Private Ltd were issued the proposed declaration.

With this Reliance Infrastructure holds 24.88 per cent summation, promoter group’s share percentile would come up to 24.95 per cent of the paid up equity share. The company posted the allotment of 18,31,00,000 equity shares. It owned 23.15 per cent of shares in Reliance Power or 93,01,04,490 shares as on June 30 
Authum Investment and Infrastructure now owns paid-up equity share capital of the company after the allotment of up to 21,82,00,000 equity shares. As on June 30th Reliance Power held 7,67,77,000 shares or 1.91 per cent stake.

Post the allotment on Monday Satan Financial Advisory Services Private Ltd would own 1.36 per cent part in Reliance Power post the allotment.

Reliance Power stated that it is a zero bank debt on standalone basis and looking poised to proceed into new horizons of growth. Particularly, Reliance Power intends to expand its presence in the energy renewable sector. It intends to use a portion of the proceeded Rs 803.60 crore towards expanding into the renewable sector and other new business opportunities. This includes meeting the long term working capital requirement.

For all this, the company plans to make investments or provide financial support to its subsidiaries. Special purpose vehicles and joint ventures includes equity, quasi equity, subordinated or unsubordinated debt. 
A portion of the issued shares will be directed towards the conversion of the debt availing the company from Reliance Infrastructure Ltd thereby reducing the existing debt of Reliance Power. This aims to achieve Reliance Power’s financial stability and develop cash flow, ultimately positioning it for better future.

“For general corporate purposes and not limiting the operational expenses, corporate exigencies and managing juncture, 25% of the issue proceeds will be utilised. Company’s financial health, enhancing net worth and minimising debt, ensuring long-term stabilization are some aspects where funds are being directed,” Reliance Power said.