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IPO of Sahas Urja Limited Opening Today; Everything You Need to Know About the Company

Company Profile:

Incorporated in February 2014 as a private limited company, Sahas Urja Limited (Sahas) was converted to a public limited company in September 2014 to facilitate public participation. The paid-up capital of the company as of mid-July 2020 was NPR 2,450 million. The major promoters include Mr. Mahendra Kumar Giri (2.29% stake), Mr. Sushil Thapa (2.11%), Ms. Anupama Thapa (2.04%), and Mr. Him Prasad Pathak (1.94%), among others. The company plans to raise NPR 1,050 million, i.e., 30% of the total equity from general shareholders, through the proposed IPO issue. It is developing an 86-MW Solu Khola (Dudh Koshi) HEP in Solukhumbu District, Province 1 of Nepal. The project is a run-of-the-river (R-o-R) type and is being developed at a 40.70% probability of exceedance (Q40.70).

About the Issue:

Sahas Urja Limited is issuing 7,000,000 units of ordinary shares worth Rs. 70 crores to the general public from Ashwin-06. The early closing date of this IPO issue is on Ashwin-10, 2078. If this issue is not subscribed till Ashwin-10, 2078 then the issue will be extended up to Ashwin-20, 2078.

The company is set to issue a total of 7,000,000 units of shares i.e., 20% of the total issued capital from Ashwin-06, 2078. From the total of 7,000,000 units, 350,000 units i.e., 5% are for the Mutual Fund. 3% of the total units i.e., 210,000 units are for the employee of the company, and the remaining 6,440,000 units are for the general public.

Applications can be placed for a minimum of 10 units and a maximum of 1,050,000 units.

NIBL Ace Capital Limited has been appointed as the issue manager for the IPO issuance.

Sahas Urja Limited:

Particulars Percentage Units Amount
Total Capital 100% 3,500,000 350,000,000
Total Issue 20% 7,000,000 700,000,000
Employees 3% of IPO Units 210,000 21,000,000
Mutual Fund 5% of IPO Units 350,000 35,000,000
General Public 92% of IPO Units 6,440,000 644,000,000
Issue Manager NIBL Ace Capital Limited
Issue Open Date Ashwin 06, 2078
Issue Closing Date (earliest) Ashwin 10, 2078
Issue Closing Date (Late) Ashwin 20, 2078
Minimum Application 10
Maximum Application 1,050,000

ICRA Rating:

ICRA Nepal has assigned an issuer rating of [ICRANP-IR] BB+ (pronounced ICRA NP issuer rating double B plus) to Sahas Urja Limited (Sahas).

Credit Strengths:

  • Prior experience of promoters in hydropower sector provides comfort
  • Return and coverage indicators expected t remain supported by lower project cost
  • Low funding risk at current cost estimates
  • Lower evacuation risk
  • Low tariff and offtake risks with presence of long-term PPA at predetermined tariffs and escalations

Credit Challenges

  • High project execution risks
  • Delay in project completion could result in cost escalation, tariff escalation loss and late COD penalty
  • High hydrology risks, given lack of deemed generation clause in PPA

(Source: ICRA Nepal)

Capital Structure:

Capital Structure
Authorized Capital 3,500,000,000.00
Issued Capital 3,500,000,000.00
Current Paid-Up Capital 2,450,000,000.00
Capital after IPO Issuance 3,500,000,000.00


Shareholding Structure:

  Number of Shares Amount Percentage Remarks
Promoters Shareholders 24,500,000.00 2,450,000,000.00 70% Already Issued
Project affected locals 3,500,000.00 350,000,000.00 10% Already Issued
General Public 7,000,000.00 700,000,000.00 20% To be Issued
Total 35,000,000 3,500,000,000 100%

Board of Directors:

Board of Directors
Name Position
Mr. Him Prasad Pathak Chairman
Mr. Sushil Thapa Managing Director
Mr. Mukti Ram Pandey Director
Mr. Bhoj Bahadur Shah Director
Mr. Min Raj Kadel Director
Mr. Mahendra Kumar Giri Director
Mr. Paritosh Paudyal Director

Projects:

Name of Project Solu Khola Jalavidhyut Aayojana
Type of Project Run-of-River
Installed Capacity 86 MW
Total Cost 11.86 Arba
Cost per Megawatt 13.79 Crores
Commercial Operation Date (COD) Jestha-20, 2079
Project handover to NEA Date Ashwin 01, 2106

Use of funds from IPO:

Usage Area Amount
Bridge Gap Loan 60 Crores
Payment to Civil Contractors 22 Crores
Payment to Hydromechanical Contractors 13 Crores
Payment to Transmission Line Contractors 10 Crores
Total 1.5 Arba

(The total amount includes the amount collected from IPO issued to people affected by the project)

Financial Highlights:

Particulars Actual Estimated*
2074/2075 2075/2076 2076/2077 Ashad 2078 2078/2079 2079/2080 2080/2081
Total Paid-Up Capital (‘000) 1,230,494.00 2,450,000.00 2,450,000.00 2,450,000.00 3,500,000.00 3,500,000.00 3,500,000.00
Reserve & Surplus (‘000) 843,967.00 -10,616.00 854,453.00 1,401,631.00 2,254,323.00 2,436,453.00 2,634,406.00
Debt (‘000) 500,000.00 1,006,181.00 2,919,855.00 5,372,894.00 8,360,113.00 8,192,190.00 7,774,905.00
Revenue (‘000) 394,184.00 618,360.00 3,437,116.00 3,472,810.00 4,887,710.00 2,578,224.00 2,655,571.00
Net Profit (‘0000 -2,246.00 -1,351.00 -865,069.00 -549,278.00 770,276.00 1,011,830.00 1,099,738.00
Earnings per share (Rs.) -0.18 -0.06 -35.31 -22.42 22.01 28.91 31.42
Net worth per share (Rs.) 168.59 99.57 134.88 157.21 164.41 169.61 175.27
Debt-Equity (times) 0.24 0.41 0.88 1.39 1.45 1.38 1.27
Return on Equity (%) -0.11% -0.06% -26.18% -14.26% 13.39% 17.04% 17.93%

 

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