Sterlite Power Transmission may consider listing post demerger
Sterlite Power Transmission Ltd (SPTL), which will retain only its manufacturing vertical following the proposed demerger of the transmission business, may explore a public listing as part of its fundraising plans, said managing director Pratik Agarwal.
The Vedanta Group's manufacturing arm, Global Products and Services, produces power transmission components, such as conductors, power cables and overhead wire cables.
In November, the company announced the demerger of its transmission business into a separate entity. In an interview, Agarwal said the company is awaiting the approval for the demerger from the National Company Law Tribunal (NCLT) and expects the process to be completed by the second quarter of FY25.
"The most suitable business for the public markets is our manufacturing business. There are multiple listed players in that space—some are in B2B, some in B2C—and some are capitalizing on the Indian growth story. We are also riding a global growth wave, with 50% of our business coming from exports. We have 40 customers across the US, Europe, Latin America, Southeast Asia, and Australia. So, it is very suitable. Post-demerger, we will evaluate all fundraising options," he added.
“We have no urgency, but we will evaluate all options. If the markets are favourable and, depending on investor interest, we will surely consider a listing of the manufacturing business.”
The company is also considering expanding its existing manufacturing facilities in India, besides setting up a new facility, Agarwal said. “The total investment for expansion (both brownfield and greenfield) should be in the range of ₹350400 crore.”
The manufacturing business is projected to grow by 20-30% in 2024-25, buoyed by the around₹2 trillion worth of central sector transmission projects in India.
The company is also in talks with private equity investors for raising funds for its transmission business, he said.
“That is the business where we operate like a highway operator, where we build, own and operate transmission lines, providing transmission services to end users, generators, and consumers. That business is growing very, very fast. And then we're looking at closing a large transaction with a very large investor, which we also hope to finalize soon.”