Power project to generate 2.4 MW:

Hemas Power to launch IPO

Sanjeevi Jayasuriya

The power sector has enormous potential as the per capita electricity consumption would increase due to the improvement in the quality of people’s lives. There is much scope for household electrification, said Managing Director, Hemas Power (Pvt) Ltd. Kishan Nanayakkara.

Hemas Power Limited will launch its Initial Public Offering (IPO) - 31,300,000 ordinary shares issued through an offer for subscription. The company will be listed on the Main Board of the Colombo Stock Exchange.

The key objectives of the issue are to raise funds to construct the Magal Ganga mini hydro power plant and the acquisition and development of other projects, he said.

The project under development will generate 2.4 MW of electricity.

Our contribution to the power sector will complement the Government’s plan to achieve 10 percent of power generation through renewable energy. The Government is keen on the renewable energy sector and has set up a Sustainable Energy Authority. It has also appointed a Presidential Task Force to look in to the issues and extend support towards the sector, he said.

The Hemas Power IPO is the first corporate IPO in post-war Sri Lanka and is expected to raise between Rs. 532 million -Rs. 626 million. The share issue is managed by NDB Investment Bank.

The offer will be 25 percent of the share capital, hence the float. The share offer price will be determined via a book building process. The book building range is Rs. 17, Rs. 18, Rs. 19 and Rs. 20.

The official opening date of IPO is September 17 and applications are now being accepted from the public. Secondary market trading is excepted to take place during mid October.

“With the end of the war, Sri Lanka’s economic climate has been on an upward trend. With the opening of the North and the East, the signs are healthy and positive. We have great confidence that this IPO will be oversubscribed on the opening day,” said Chairman, Hemas Power Husein Esufally.

Hemas Power which was set up in 2003, entered Sri Lanka’s power generation industry at a crucial stage when the Government actively promoted private sector involvement in local power generation.

Hemas Power currently supplies electricity for local consumption through its joint venture thermal power plant in Puttalam and its hydro power plant in Teldeniya in its efforts to help the national demand for power.

The Hemas Group is one of the top conglomerates in Sri Lanka with a focus on five key sectors - FMCG, healthcare, transportation, leisure and power generation.