Kathmandu, March 29: The Rawa Energy Development Limited and Bhugol Energy companies will be issuing Initial Public Offering (IPOs) from April 5, 2023 (Chait 23). Both the companies have stated that the IPOs will be available for project area locals and foreign workers.
The project affected people from Keplashgadi Rural Municipality of Khotang district will get 280,000 shares. Likewise, foreign workers who have joined foreign labour under government approval will get 56,000 shares.
Prabhu Capital Limited has been appointed as the issue manager. The promoter-public share ratio will be 70: 30 after this IPO. CARE Ratings Nepal Limited (CRNL) has assigned the issuer rating assigned of ‘CARE-NP BB (Is)’ to Rawa Energy Development Limited. Issuers with this rating are considered to have a moderate risk of default regarding the timely servicing of financial obligations in Nepal.
Likewise, Bhugol Energy Development Company will also issue IPOs from April 5, 2023 (Chait 23). The Company has stated that it will issue 13,46,993 units of shares of Rs. 100 face value to general public. The Nepali foreign workers will get 108,811 scrips. The company intends to collect Rs. 13.46 crores from this IPO.
Earlier, the company had issued 544,053 unit shares worth Rs. 5.44 crores to the project-affected locals of Dailekh District out of which only 85,020 units were allotted to valid applicants. Thus, the remaining 459,033 units of unsubscribed shares of project-affected locals are added to 10,88,107 units (20% of the issued capital which is reserved for the general public) to make a total of 15,47,140 units for the general public.
NIC Asia Capital Limited has been appointed as the issue manager for the IPO issuance. Applications can be placed for a minimum of 10 units and a maximum of 30,000 units.
ICRA Nepal has reaffirmed an issuer rating of [ICRANP-IR] B- (pronounced ICRA NP issuer rating B minus) to Bhugol Energy Development Company Limited. Issuers with this rating are considered to have a high risk of default regarding the timely servicing of financial obligations.
What is Bhugol Energy?
Bhugol Energy Development Company Limited was incorporated on February 16, 2009, as a private limited company, and was later converted into a public limited company on October 31, 2017, to facilitate public participation. The company operates a 3.75-MW Dwari Khola Small Hydropower Project, in Dailekh District in Karnali Province of Nepal. The project started commercial operations on May 6, 2017, against the required COD of June 30, 2017, and was developed at a total cost of ~NPR 734 million (~NPR 196 million per MW) funded in an initial debt-to-equity ratio of ~82:18.
Know about Rawa Energy
Rawa Energy Development Ltd is a public limited company, incorporated on August 16, 2009, as a private limited company and later converted to a public limited company on June 28, 2019. It is promoted by business persons having long experience in hydropower and other sectors for setting up Hydroelectric Projects (HEP) in the territory of Nepal. The company has a 3 MW Upper Rawa Khola Small Hydropower Project (URKHP) in Khotang District which has been in commercial operation since September 20, 2020. The project is constructed under BOOT (Build, Own, Operate, and Transfer) mechanism.