These Are The Key Information You Should Know Before Investing In IPO Of Emerging Nepal Limited, IPO opens from today
Wed, Feb 9, 2022 6:26 AM on IPO/FPO News, Company Analysis, Latest,
About the issue:
Emerging Nepal Limited (ENL) is issuing 555,600 units of ordinary shares worth Rs 55,560,000 to the general public from Magh 26, 2078. The early closing date of this issue is on Falgun 1 and if the issue is not fully subscribed till Falgun 1, then it can be extended up to Falgun 11, 2078.
Out of the offered 5,55,600 units; 2% of the total public issue i.e. 11,112 units have been set aside for the employees of the company and 5%, i.e. 27,780 units have been set aside for mutual funds. The remaining 5,16,708 units are for the general public (individuals).
Applications can be placed for a minimum of 10 units and a maximum of 5,000 units.
NIC Asia Capital Ltd has been appointed as the issue manager for the IPO issuance.
After the issuance of 5,55,600 units worth Rs. 5.5 crore IPO shares the general public i.e 10% of total capital which will together raise its paid-up capital to Rs 55.56 crore and the promoter/public ratio will be 90:10.
|
Particulars |
Percentage |
Units |
Amount |
|---|---|---|---|
|
Total Capital |
100% |
5,556,000 |
555,600,000 |
|
Total Issue |
10.00% |
555,600 |
55,560,000 |
|
Employees |
2% of IPO issue |
11,112 |
1,111,200 |
|
Mutual Fund |
5% of IPO issue |
27,780 |
2,778,000 |
|
Public |
9.3% of Issued capital |
516,708 |
51,670,800 |
|
Issue Manager |
NIC Asia Capital Limited |
|
|
|
Issue Open Date |
26 Magh, 2078 |
|
|
|
Issue Closing date (earliest) |
01 Falgun, 2078 |
|
|
|
Issue Closing date (late) |
11 Falgun, 2078 |
|
|
|
Minimum application |
10 |
|
|
|
Maximum Application |
5000 |
|
|
Company Info:
Emerging Nepal Limited was established in August 2015 as a public-private partnership (PPP) investment company with the motive to invest in projects from diverse sectors. ENL is promoted by the renowned business groups of Nepal, with the major holding by the Vishal Group and IME Group affiliated entities and individuals (joint stake of more than 50%).
Shareholding Structure
|
Shareholders |
Shares Held |
% Held |
Total Amount (Rs) |
Status |
|
Promoter Shareholder |
5,004,000 |
90.00% |
500,400,000 |
Paid |
|
Public Shareholders |
555,600 |
10.00% |
55,560,000 |
After issuance of IPO |
|
Total |
5,556,000 |
100% |
555,600,000 |
- |
Board of Directors
|
Name |
Designation |
|---|---|
|
Mr. Shri Lal Mani Joshi |
Chairman |
|
Mr. Shri Shova Kanta Poudel |
Director |
|
Mr. Shri Ashok Kumar Agrawal |
Director |
|
Mr. Shri Chandra Tandan |
Director |
|
Dr. Binod Atreya |
Director |
|
Mrs. Lima Acharya (Adhikari) |
Independent Director |
Emerging Nepal Limited will be the 6th company to be listed as an investment company in NEPSE. As such, the addition may play a crucial role in the development of the investment sector and its index. Furthermore, as an investment company, Emerging Nepal Limited may help channel investment funds from the capital market to diversified sectors of the national economy.
Capital Structure
|
Particulars |
Amount (Rs) |
|
Authorized Capital |
5,000,000,000 |
|
Issued Capital |
555,600,000 |
|
Current Paid-Up Capital |
500,040,000 |
|
Capital after issuance of IPO |
555,600,000 |
Key Financial Indicators
|
Figures in NPR Million |
FY2018 (Audited) |
FY2019 (Audited) |
FY2020 (Audited) |
9MFY2021 (Provisional) |
|---|---|---|---|---|
|
Operating income |
28 |
20 |
15 |
13 |
|
Total expenses |
13 |
7 |
5 |
4 |
|
PAT |
15 |
13 |
10 |
9 |
|
Share Capital |
450 |
450 |
450 |
500 |
|
Net Worth |
465 |
478 |
464 |
526 |
|
Investments (excluding FDs) at Book Value |
224 |
362 |
370 |
358 |
|
Cash and Bank Balances (including FDs) |
237 |
116 |
93 |
165 |
|
Gearing |
0.00% |
0.00% |
0.00% |
0.00% |
|
Return on Average Assets |
4.51% |
2.66% |
2.06% |
2.33% |
|
Return on Average Net Worth |
4.68% |
2.69% |
2.07% |
2.34% |
|
Source: Company data |
Company's Portfolio
|
Company |
Sector |
|
|---|---|---|
|
Nepal Infrastructure Bank Limited |
Investment |
|
|
CARE Ratings Nepal Limited |
Rating agency |
|
|
Hotel Alice The Wonder Inn Limited |
Hotels and Tourism |
|
|
Banking Finance and Insurance Institute of Nepal Ltd. |
Training & Research Institutions |
|
ICRA Rating:
ICRA Nepal has assigned an issuer rating of [ICRANP-IR] BB+ (pronounced ICRA NP Issuer Rating Double B Plus) to ENL which means that the company has a moderate risk of default.
Key Strengths:
Strong promoter profile
Adequate value generation for shareholders
Comfortable financial flexibility
Key Challenges:
Limited track record with evolving system and procedures
Lack of clarity regarding sources of raising further funds for investment
Absence of company's ability to maintain liquid investment portfolio on a sustained basis
Conclusion:
Emerging Nepal, which is backed up by strong promoters shareholders, is expected to give IPO investors impressive returns under the assumptions of the basic theory of demand and supply.
The total shares floated by Emerging Nepal Limited is 555,600 units, of which only 5,16,708 units are available to the general public after the allocation of shares to staff and mutual funds.
If we see the recently concluded IPO, a total of more than 27 lakh applicants applied for the company IPO and we assume that the same or even more craze prevails in Emerging Nepal Limited's IPO too. Since the 10 kitta rule exists for IPO; 51,670 applicants will be lucky enough to get the shares of Emerging Nepal Limited.
Hence, if the same number of applicants (or more), i.e., 26+ lakhs apply for this issue then there is a high probability of lottery for 10 units. Since the minimum unit is 10, it is advisable to apply only 10 units in the IPO issue of Emerging Nepal Limited.
