Introduction

India's power transmission sector is witnessing a wave of innovative business strategies aimed at enhancing business models and value optimization. One such player is Sterlite Power, supported by Vedanta Group's Anil Agarwal, which is currently undergoing an internal restructuring exercise. With Singapore's sovereign wealth fund, GIC, on the verge of a significant investment, all eyes are on the evolving dynamics of this deal.

The Blueprint of Sterlite Power's Restructuring and GIC's Role

In a strategic move, Sterlite Power is demerging its solutions business from its overall structure. This division provides strategic enhancements and upgrade solutions to power utilities. The plan for the demerged entity involves potential listing on domestic exchanges, an initiative to unlock additional value. In parallel, GIC is charting a substantial entry into Sterlite Power's power transmission business. Post the spin-off, GIC intends to invest approximately $300 million, forming a 51:49 joint venture with Sterlite Power.

Advising the Deal: Avendus Capital and Deutsche Bank

Avendus Capital and Deutsche Bank are key advisers in this transformational deal. While Avendus Capital is guiding Sterlite Power on the restructuring, Deutsche Bank is focusing on the GIC funding aspect. The talks are at an advanced stage and are projected to conclude soon.

Sterlite Power's Solutions Vertical: An Overview

The solutions vertical, earmarked for demerger, provides bespoke solutions for brownfield transmission infrastructure projects' upgrade/uprate. These strategic solutions aim to improve short and long-term performance and hold significant value within Sterlite Power's portfolio.

The Draw for GIC: Sterlite Power's Global Infrastructure Business

GIC's interest lies primarily in Sterlite Power's Global Infrastructure business. This sector bids for, designs, constructs, owns, and operates power transmission assets, boasting operations in India and Brazil. The division holds a portfolio of 31 completed and under-construction projects, making it a key draw for investors.

Sterlite Power's Unlisted Shares and Future Valuation

Currently, Sterlite Power's unlisted share price stands at Rs.600 per share. With approximately 12 Cr shares outstanding, the current valuation of the transmission business and solutions business is about Rs.7200 Cr. The value the solutions business will command post the demerger will significantly influence Sterlite Power's valuation in the unlisted market going forward.

India's Power Transmission Infrastructure Sector: A Look Ahead

The future seems promising for India's power transmission infrastructure sector. With expected government bids for projects worth Rs 1.50 lakh crore over the next 18 months, a robust growth phase is on the horizon.

Conclusion

The unfolding Sterlite Power and GIC deal paints a dynamic picture of investment and restructuring in India's power transmission sector. With potential implications for Sterlite Power's unlisted share prices, this development holds industry-wide significance and is a testament to the sector's future potential Source: MoneyControl https://unlistedzone.com/shares/sterlite-power-transmission-limited-share-price-buy-sell-unlisted-shares-of-sterlite-power-transmission/