Kathmandu, November 14
Solu Hydropower Company is set to open its Initial Public Offering (IPO) from Mangsir 7, 2082. The IPO will first open for project-affected locals and Nepalis working abroad. The issue for the general public will open only after these two groups receive their allocations.
IPO Details
The company plans to issue 20 million shares worth Rs. 2 billion to the public, which is 20% of its Rs. 10 billion issued capital, already approved by the Securities Board of Nepal (SEBON).
Allocation Breakdown
1 crore shares reserved for project-affected locals
40 lakh shares for residents of the most affected wards:
Dudhkunda Municipality Wards 7 and 11
Thulung Dudhkoshi Rural Municipality Ward 1
60 lakh shares for locals of other wards within these municipalities
10 lakh shares reserved for Nepalis currently working abroad
Both groups can apply for a minimum of 10 units and a maximum of 100,000 units.
Application Deadlines
Project-affected locals:
Earliest closing: Mangsir 21
If not fully subscribed: extended until Poush 7
Foreign-employed Nepalis:
Earliest closing: Mangsir 10
If not fully subscribed: extended until Mangsir 21
Where to Apply
Project-affected locals can obtain prospectuses and submit applications at:
Global IME Bank, Salleri Branch
Laxmi Sunrise Bank, Nele Branch
Lower Solu Hydropower Project Office
Application form fee: Rs. 2
Foreign-employed Nepalis can apply through:
ASBA-participating banks and financial institutions
Online via Mero Share
Nabil Investment Banking Limited is the issue manager for the IPO.
How Is the Company? (Project & Financial Overview)
Solu Hydropower has developed the 82 MW Lower Solu Hydroelectric Project in Solukhumbu district. The project is based on a run-of-the-river model and has already started commercial electricity generation from Shrawan 24, 2081.
Project Cost & Profitability
Total project cost: Rs. 16.30 billion
Cost per MW: Rs. 19.88 crore
Electricity generation license valid until: Chaitra 4, 2106
Financial Indicators (FY 2080/81)
Earnings per share (EPS): Rs. 0.23
Net worth per share: Rs. 100
Reserve fund: Rs. 15.8 million
Estimated simple payback period: 6.78 years
Total loan: Rs. 10.60 billion
Planned IPO raise: Rs. 8 billion
According to unaudited recent financials, the company has:
Cumulative profit: Over Rs. 2.83 billion
EPS: Rs. 3.39
Net worth per share: Rs. 135.45
Credit Rating
Infomerics Credit Rating Nepal has assigned the company IRN BB (Issuer Rating), indicating a moderate risk level in meeting financial obligations.
Major Promoters
Key founders and major shareholders include:
Govind Lal Sanghai, Ram Chandra Sanghai, Virendra Kumar Sanghai, Aditya Sanghai, Anuj Agrawal, Vishal Agrawal, Subhash Chandra Sanghai, Harshvardhan Sanghai, Nikunj Agrawal, among others.