Balephi Hydropower Opening IPO to Public from Today, Here's All You Need to Know

Balephi Hydropower Limited has published an offer letter to issue an IPO to the general public. The IPO issue will open today, i.e. on 16th Chaitra and close on 21st Chaitra, 2078. If not subscribed by the early closing date, the deadline can be extended till 30th Chaitra.

18,27,970 shares will be issued at a par value of Rs. 100 per unit. 4% of the total issue, i.e. 73,119 units have been allocated for employees while 5%, i.e. 91,398 units have been allocated for mutual funds. The rest 16,63,453 shares are for the individual public.

The minimum bid quantity is 10 units while the maximum is 1,00,000 units. Global IME Capital has been appointed as the issue manager for the IPO issuance. ICRA Nepal Limited has rated the issue Double B, indicating a moderate risk of default regarding timely servicing of financial obligations.

Offer Letter

Company Profile:

Incorporated on February 15, 2012, as a private limited company, Balephi Hydropower Limited (BHL) was converted into a public limited company on January 6, 2017, to facilitate public participation. BHL is developing a 36-MW Upper Balephi A hydroelectric project in Sindhupalchowk district of Province 3 of Nepal, which is around 95-98% complete as of November[1]end 2021. This run of the river (R-o-R) project is being developed at a 41.60% probability of exceedance (Q41.60). The project has been estimated to be developed at a revised budgeted cost of NPR 7,856 million (~NPR 218 million per MW) at a debt-equity ratio of 74:26. BHL has a paid-up capital of ~NPR 1,462 million, as of mid-July 2021, which is 100% held by the promoters. The major promoters of the company include Mr. Shakti Kumar Golyan (18.25%), Mr. Shulav Agrawal (18.25%), Mr. Shushil Gupta (17.50%), Mr. Shandeep Kumar Sharda (15%), Mrs. Prabha Goyanka (Bhimshariya) (9.95%) and Mr. Umesh Kasaju (8.68%). Out of the total equity requirement, the promoters have already injected their 100% capital commitment and the rest 20% of the equity, which is yet to be issued an Initial Public Offering (IPO), has been funded through a bridge gap loan against the proposed IPO

ICRA Rating:

ICRA Rating Nepal has assigned [ICRANP-IR] IPO BB to the proposed Initial Public Offering (IPO) of Balephi Hydropower Limited indicating a moderate risk of default regarding timely servicing of financial obligations.

Key Grading Weakness:

• Lower Project Execution risk
• Lower evacuation risk
• Experienced promoters and management
• Low tariff and offtake risks with the presence of long-term PPA at predetermined tariffs and escalations

Key Grading Strengths:

• High project commissioning cost
• Funding gap amid the escalated project cost
• Failure to get extended RCOD could result in tariff escalation loss and late COD penalty
• High hydrology risks, given lack of deemed generation clause in PPA

Board Members:

Capital Structure:

Shareholding Pattern:

Project Information:

Use of Funds collected from IPO

Financial Highlights: