Mandakini Hydropower (MAHCL) IPO For Locals Opens From Today; All information You Need To Know In One Place
Wed, Jun 15, 2022 10:16 AM on IPO/FPO News, Company Analysis, Exclusive,
Company Profile:
Mandakini Hydropower Company Limited (MAHCL) is an Independent Power Producers Association Nepal (IPP) of Nepal, owns the Sardi Khola Hydropower Station. It is a run-of-river hydroelectric plant located in the Kaski District of Nepal. The flow from the Sardi River is used to generate 4 MW of electricity. The plant started generating electricity from 2074-08-23 BS. The generation license will expire in 2105-03-12 BS, after which the plant will be handed over to the government. The power station is connected to the national grid and the electricity is sold to Nepal Electricity Authority.
About the issue:
Mandakini Hydropower Company Limited (MAHCL) will be issuing its IPO to the project-affected locals of Kaski District from 1st Ashadh and close on 15th Ashadh, 2079. If unsubscribed, the issue can be extended up to 30th Ashadh, 2079.
5,88,037 unit shares will be issued at a par value of Rs. 100 per share. This is 10% of the company's issued capital Rs 58.80 crore. If the local's issue is not subscribed fully, the remnant shares will be issued along with the allocated quantity for the public issue. Locals of Machhapuchchre VDC wards no. 2, 3, 4, and 6 of Kaski District can apply for a minimum of 10 shares to a maximum of 1,00,000 shares. This will raise the paid-up capital of the company to Rs. 58.80 crores after the IPO allotment. After the IPO Promoter - Public share ratio would be 70: 30.
BOK Capital Market has been appointed as the issue manager for the IPO issuance.
| Mandakini Hydropower Limited | |||
|---|---|---|---|
| Particulars | Percentage | Units | Amount |
| Total Capital | 100% | 58,80,369 | 58,80,36,900 |
| Total Issue (Project-affected Locals) | 10.00% | 5,88,037 | 5,88,03,700 |
| Issue Manager | B.O.K Capital Market | ||
| Issue Open Date | 1st Ashad | ||
| Issue Closing Date (earliest) | 14th Ashad | ||
| Issue Closing Date (Late) | 30th Ashad | ||
| Minimum Application | 10 | ||
| Maximum Application | 100,000 | ||
Capital Structure:
| Authorized Capital | 65,00,00,000 |
| Issued Capital | 58,80,36,900 |
| Current Paid-Up Capital | 41,16,25,900 |
| Capital after IPO Issuance | 58,80,36,900 |
Shareholding Structure:
| Number of Shares | Amount | Percentage | Remarks | |
|---|---|---|---|---|
| Promoters Shareholders | 41,16,259 | 41,16,25,900 | 70.00% | Already issued |
| Project Affected Locals | 5,88,037 | 5,88,03,700 | 10.00% | To be issued |
| General Public | 11,76,073 | 11,76,07,300 | 20.00% | To be issued |
Project Information:
| Name of Project | Sardikhola Jalvidhyut Aayojana |
| Type of Project | Run-of-River |
| Installed Capacity | 4 MW |
| Electricity Generation License received | Ashadh 13, 2070 |
| Generation Valid Date | Ashadh 12, 2105 |
| RCOD | Mangsir 23, 2074 |
| Total Cost in Rs | 83,10,12,000 |
| Cost per Megawatt in Rs. | 20,77,00,000 |
Financial Statement:
| Financial Highlights | |||||||
|---|---|---|---|---|---|---|---|
| Particulars | Actual | Estimated | |||||
| 2075/76 | 2076/77 | 2077/78 | 2078 (Q3) | 2078/79 | 2079/80 | 2080/81 | |
| Total Paid-Up Capital | 172,002,100.00 | 385,000,000.00 | 411,625,900.00 | - | 588,036,900.00 | 588,036,901.00 | 588,036,902.00 |
| Reserve & Surplus | (20,676,345.02) | (6,687,474.77) | 8,442,722.64 | - | 54,971,383.20 | 75,972,034.08 | 102,761,763.74 |
| Debt | 466,688,619.26 | 445,415,625.23 | 409,893,365.30 | - | 323,393,366.00 | 636,758,069.80 | 553,558,069.80 |
| Revenue ('000) | 92,271,024.85 | 104,867,148.04 | 96,571,011.90 | 92,748,093.46 | 124,229,943.72 | 124,229,943.72 | 124,229,943.72 |
| Interest Expenses | 51,668,347.34 | 46,143,589.06 | 38,067,023.02 | 2,23,36,842.17 | 33,484,676.93 | 57,946,556.90 | 51,137,969.40 |
| Net Profit | (1,087,705.55) | 13,988,870.25 | 15,130,197.41 | 34,535,855.32 | 46,528,660.56 | 21,000,650.87 | 2,789,729.67 |
| Earnings per share (Rs.) | (0.63) | 3.63 | 3.68 | - | 7.91 | 3.57 | 4.56 |
| Net worth per share (Rs.) | 88.00 | 98.00 | 102.00 | - | 109.00 | 113.00 | 117.00 |
| Debt-Equity (times) | 3.08 | 1.18 | 0.98 | - | 0.50 | 0.96 | 0.80 |
| Return on Equity (%) | (0.01) | 0.04 | 0.04 | - | 0.07 | 0.03 | 0.00 |
CARE Ratings:
CARE Ratings Nepal Limited (CRNL) has assigned Issuer rating of ‘CARE-NP BB+ (Is) [Double B Plus (Issuer Rating)]’ to Mandakini Hydropower Limited (MHL). Issuers with this rating is considered to have a moderate degree of safety regarding timely servicing of financial obligations, in Nepal.
Key Strengths:
- Experienced promoter/directors and management team.
- The power purchase agreement with sufficient period coverage.
- Moderate financial performance of the company, however, gearing ratio is expected to be increased in future.
- Low Power evacuation risk.
- Current demand & Supply gap however possible oversupply in the future along with moderate counterparty risk.
- Favorable government policies towards the power sector.
Key Weaknesses
- Project implementation and funding risk in case of USHP.
- The subdued operating performance of the Sardi Khola Hydropower Project.
- Hydrology risk associated with run-of-the-river power generation.
- Exposure to regulatory risk.
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