IPO of Bhugol Energy Development Company Opens From Today For Project-Affected Locals and Nepalese Employed Abroad
Mon, Feb 20, 2023 10:02 AM on IPO/FPO News, Company Analysis, Latest,
Company Profile:
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.
About the issue:
Bhugol Energy Development Company Limited will be issuing its IPO to the project-affected locals of Dailekh District and Nepalese citizens working abroad from today i.e on 8th Falgun and close on 25th Falgun, 2079. Note that for the locals of Dailekh District, if the issue is not subscribed by the early closing date, the issue can be extended till 7th Chaitra. However, the issue will not be extended from the early closing date for Nepalese citizens working abroad.
The issued capital of the company is Rs. 54.40 Crores of which 10% i.e. 544,053 unit shares worth Rs. 5.44 crores have been allocated to project-affected locals of Dailekh District. Meanwhile, 20% of the company's issued capital i.e. 10,88,107 unit shares will be issued later for the general public. Of this public issue, 10% of the shares totaling 108,811 units shares have been allocated for Nepalese citizens working abroad, the issue of which will open today.
The minimum application quantity to be applied for both project-affected locals and Nepalese citizens working abroad is 10 units while the maximum quantity is 30,000 units. NIC Asia Capital Limited has been appointed as the issue manager.
Click here for the offer letter
| Bhugol Energy Development Company Limited | |||
|---|---|---|---|
| Particulars | Percentage | Units | Amount |
| Total Capital | 100% | 5,440,534.00 | 544,053,400.00 |
| Total Issue (Project-affected Locals) | 10% | 544,053.00 | 54,405,300.00 |
| Total Issue (Nepalese citizens working abroad) | 2.00% | 108,811.00 | 10,881,100.00 |
| Issue Manager | NIC Asia Capital | ||
| Issue Open Date | 8th Falgun | ||
| Issue Closing Date (earliest) | 25th Falgun | ||
| Issue Late Closing Date (for locals only) | 7th Chaitra | ||
| Minimum Application | 10 | ||
| Maximum Application | 30,000 | ||
Capital Structure:
| Authorized Capital | 600,000,000.00 |
| Issued Capital | 544,053,400.00 |
| Current Paid-Up Capital | 380,837,400.00 |
| Capital after IPO Issuance | 544,053,400.00 |
Shareholding Structure:
| Number of Shares | Amount | Percentage | Remarks | |
|---|---|---|---|---|
| Promoters Shareholders | 3,808,374.00 | 380,837,400.00 | 70% | Already issued |
| Project-Affected Locals | 544,053.00 | 54,405,300.00 | 10% | To be issued |
| General Public (Including Nepalese citizens working abroad) | 1,088,107.00 | 108,810,700.00 | 20% | To be issued |
Project Information:
| Name of Project | Dwari Khola Jalbidhyut Yojana |
| Type of Project | Run-of-River |
| Installed Capacity | 3.75 MW |
| Electricity Generation License received | Jestha 26, 2071 |
| Generation Valid Date | Jestha 25, 2106 |
| RCOD | Baisakh 23, 2074 |
| Total Cost | Rs. 73.19 Crores |
| Cost per Megawatt in Rs. | Rs. 19.51 Crores |
Board of Directors:
| Name | Position |
|---|---|
| Mr. Saurabh Aryal | Chairman |
| Mr. Rajendra Prasad Gautam | Director |
| Mrs. Sangeeta Sharma | Director |
| Mr. Shanta Kumar Aryal | Director |
| Mr. Ranjan Kumar Sharma | Director |
Financial Statement:
| Financial Highlights | |||||||
|---|---|---|---|---|---|---|---|
| Particulars | Actual | Estimated | |||||
| 2076/77 | 2077/78 | 2078/79 | 2079/080 (Q1) | 2079/80 | 2080/81 | 2081/82 | |
| Total Paid-Up Capital ('000) | 241,140 | 241,140 | 380,837.00 | 380,837.00 | 544,053.00 | 544,053.00 | 544,053.00 |
| Reserve & Surplus ('000) | (94,029.00) | (123,613.00) | (101,901.00) | (137,212.00) | (62,378.00) | (18,542.00) | 28,706.00 |
| Debt ('000) | - | - | - | - | - | - | |
| Revenue ('000) | 55,482 | 50,023.00 | 42,900.00 | 5,817.00 | 117,679.00 | 117,679.00 | 117,679.00 |
| Interest Expenses ('000) | 54,877 | 68,411.00 | 68,467.00 | 31,095.00 | - | - | - |
| Net Profit ('0000) | (31,029.00) | (51,707.00) | 162,172.00 | (31,438.00) | 40,287.00 | 44,598.00 | 48,011.00 |
| Earnings per share (Rs.) | (12.87) | (21.44) | 42.58 | - | 7.40 | 8.20 | 8.82 |
| Net worth per share (Rs.) | 61.01 | 39.56 | 67.63 | - | 84.75 | 92.95 | 101.77 |
| Debt-Equity (times) | - | - | - | - | - | - | - |
| Return on Equity (%) | (2.11) | (4.40) | 5.81 | (1.29) | 0.84 | 0.85 | 0.84 |
ICRA Nepal:
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.
Credit Strengths
- Adequate funding support from promoters.
- Low tariff and off-take risks with long-term PPA at predetermined tariffs and escalations.
Credit Challenges
- Further weakening in operational performance.
- Weak financial and liquidity profile.
- High hydrology risk due to lack of deemed generation clause in the PPA.
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