IME Life Insurance and Ru Ru Jalabidhyut Pariyoajana set to issue IPO to general public; SEBON adds the issue to pipeline

Securities Exchange Board of Nepal (SEBON) has added the proposed IPO issue of IME Life Insurance Company Limited under preliminary review in the latest list of IPO issues in the pipeline published.

The company is proposing to come out with an IPO of 60,00,000 equity shares with a face value NPR 100 each, at par. The amount of the issue is Rs 60 Crore. The total capital of the company post IPO will be Rs 200 crore, having promoter and public ratio 70 : 30.

Civil Capital Market Limited has been appointed as the issue manager for the proposed IPO issuance.

CRNL has assigned grading of ‘CARE-NP IPO Grade 4’ to the proposed Initial Public Offer (IPO) of IME Life Insurance Company Limited (ILIC). ‘CARE-NP IPO Grade 4’ indicates Below Average Fundamentals. 

IME Life Insurance Company Limited (ILIC) is a life insurance company registered at Office of Company Registrar under the Company Act 2006 on October 1, 2008 and has obtained license from Insurance Board on July 4, 2017. ILIC has been offering an extensive range of products as Money Back, Endowment, Whole Life, Term Assurance products etc. through its diversified sales network. ILIC is part of IME Group which has business across different sectors including banking, remittance, insurance, hydropower, hospitality etc.

Likewise; Securities Exchange Board of Nepal (SEBON) has added the proposed IPO issue of 8,15,410 units of Ru Ru Jalabidhyut Pariyoajana Ltd. under preliminary review in the latest list of IPO issues in the pipeline published.

The company is proposing to come out with an IPO of 4,07,705 equity shares with a face value NPR 100 each for the locals of the project affected area and 4,07,705 equity shares with a face value NPR 120 each for the general public. The company has proposed to issue 10% share to the local people and the same percentage and quantity to the general public. 

ICRA Nepal has assigned an “[ICRANP] IPO Grade 4+”, indicating below-average fundamentals to the proposed initial public offering (IPO) of Ru Ru Jalbidhyut Pariyojana Limited (RRJPL). 

NMB Capital Limited has been appointed as the issue manager for the proposed IPO issuance.

The company has been operating a 5-MW run of river project (Upper Hugdi Khola Hydropower Project) in Gulmi district of West Nepal since March 2015. Initially proposed as a 2.6-MW project at a 65% exceedance flow model, the project capacity was later changed to 5 MW to be built on a 43% exceedance flow model. As per the PPA with NEA, the annual contract energy for the project is ~28 GWh, corresponding to a contract plant load factor (PLF) of ~65%. The tariff rates for contract energy as per PPA are NPR 4 and NPR 7 per unit for wet and dry seasons2, respectively, subject to annual escalation from Commercial Operation Date (COD) @ 3% on base tariff for nine years. Under the Government’s initiative of promoting private sector hydropower developers, the project has been availing promotional tariff rates of NPR 4.80 and NPR 8.40 per unit in wet and dry seasons; this shall remain effective for up to the seventh year after COD with five times annual escalation of 3% on base tariff. The electricity sales revenue would thereafter be based on the rates as per the PPA.