Dear Valued Subscribers,

We are back with some riveting updates on Sterlite Power, a leading player in the Indian power sector.  As your trusted advisors in the Pre-IPO market, it's our duty to keep you abreast of pivotal shifts that  could influence your investment strategy. Today, we delve into Sterlite Power's latest strategic moves,  which include a business demerger and a subsequent IPO.

Demerger of Infra Business: Birth of SGL5

In a landmark decision made in September 2023, Sterlite Power has opted to demerge its infrastructure business  into a separate entity named SGL5. This is not just a corporate restructure; it is a joint venture with Singapore's  sovereign wealth fund GIC. GIC is anticipated to invest a colossal $500 Million for a 49% stake, valuing the separated transmission business at approximately INR 8000 Cr.

Sterlite Power Post-Demerger

Post this demerger, Sterlite Power will primarily consist of its Products, MSI, and Convergence businesses,  collectively valued at around INR 9000 Cr. This move strategically positions Sterlite Power to focus on its  core competencies while leveraging the strength of GIC in the infrastructure business.

Check our video on Product, MSI and Convergence Business Valuation -

Regulatory Approvals

The company has already filed for the demerger with the National Company Law Tribunal (NCLT). The entire process is  expected to conclude within 8-9 months, paving the way for its much-anticipated IPO.

Shareholding Structure

For every share you hold in Sterlite Power, you will be entitled to receive one share in the newly formed SGL5,  effectively doubling your investment avenues.

Financials at a Glance

The overall order book for the Products, MSI, and Convergence business stood at INR 3400 Cr for H1FY23.  With the demerger, the total business value before the split is estimated at INR 17,000 Cr. With a total of 12 Cr outstanding shares, this pegs the per-share value at approximately INR 1400. Currently, it is available at around INR 600 per share in the unlisted market. But whoever wants to invest have to wait for 2 years minimum to get value unlocking. So, invest accordingly.

What's Next: The IPO

Once the demerger is complete, Sterlite Power is expected to go public. This IPO represents not just a liquidity event  but a milestone in the company's journey toward sustainable growth.

Conclusion

The strategic reorganization of Sterlite Power into two distinct entities serves as a groundbreaking development,  opening new investment horizons. It's not just a demerger; it's a transformation that offers diversified avenues for  both Sterlite Power and its investors.

If you are intrigued and want to explore investment opportunities in Sterlite Power's Pre-IPO shares, feel free to reach  out to us.