Rental rates and booming power plants

National Hydroelectric Power Corp., India's largest hydropower generator, will proceed with a planned share sale after state-run Rural Electrification Corp.'s IPO drew bids for more stock than on offer.

``The public sector companies are strong and the response will be good,'' Anil Razdan, power secretary, told reporters in New Delhi today. ``A lot of people had advised us not to go ahead with the REC IPO, but look at the response we got.''

State-run Rural Electrification, the company that lends to power projects in India's villages, drew bids for more than 27.3 times the shares on offer in an initial sale last month.

Reliance Power Ltd., which raised $3 billion in January in India's biggest initial public offering, has said it will issue free shares after the utility's stock slumped as much as 21 percent when it listed on Feb. 11.

India's key Sensitive Index of the Bombay Stock Exchange has declined more than 18 percent since the start of the year.

Last month Emaar MGF Land Ltd., controlled by the biggest Middle East developer, scrapped its $1.64 billion initial sale following poor investor demand. Wockhardt Hospitals Ltd., part of an Indian group with interests in drugs and biotechnology, withdrew its $164 million initial offering.

National Hydroelectric has sought the regulator's approval to sell 1.68 billion new shares to partly pay for the construction of six hydropower plants. The sale will be managed by Enam Financial Consultants Pvt., Kotak Mahindra Capital Co.

and SBI Capital Markets Ltd.

National Hydroelectric's profit rose 40 percent to 7.4 billion rupees ($184 million) in the six months ended Sept. 30 from 5.3 billion rupees in the year ago, the company said on its Web site. Revenue climbed 36 percent to 19.2 billion rupees.

The company, with an installed capacity of 4,665 megawatts, has 12 projects totaling about 5,132 megawatts under construction, it said on its Web site.

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