"Prabhu Smart Fund (PSMF)" Opens From Today; All information You Need To Know In One Place
Thu, Mar 2, 2023 7:10 AM on IPO/FPO News, Mutual Fund, Company Analysis, Latest,
Company Profile
The mutual fund scheme "Prabhu Smart Fund (PSMF)" is promoted by Prabhu Bank Limited and managed by Prabhu Capital Limited.
Prabhu Bank Limited (PBL) is an “A” Class Licensed Institution from Nepal Rastra Bank (NRB). It was incorporated on July 21, 1998, as Kist Merchant Banking and Finance Ltd. and renamed as Kist Bank Ltd. June 19, 2001. Later it was merged with three other banks and financial institutions (BFIs) namely Prabhu Bikash Bank Ltd., Zenith Finance Ltd., and Gaurishankar Development Bank Ltd. on September 15, 2014, and the name of the bank was changed to Prabhu Bank Ltd. As on July 15, 2021, 51% of the total shares of PBL were held by the promoter whereas the remaining 49% is held by the general public.
Prabhu Capital Limited is one of the leading Merchant Banking companies with a paid-up capital of NRs. 100 Cr. The primary goal of the company is to serve its clients with innovative and modern Merchant Banking services while also assisting in the development of a successful and healthy Nepalese Capital Market. Prabhu Capital Ltd. is a subsidiary of Prabhu Bank Limited. Prabhu Bank Limited is a part of Prabhu Group, a conglomerate with businesses in banking, insurance, microfinance, technology, remittance and payment services, and digital services. Prabhu Capital Ltd. was established on 21st July 2009 and obtained a Merchant Banking license from the Securities Board of Nepal (SEBON) on September 9, 2010. Since then, Prabhu Capital Ltd. is currently providing various Merchant Banking services such as Depository Participant (DP), Issue Management, Underwriting, Portfolio Management Services, Registrar to the Share (RTS) Services, and Mutual Fund Manager.
About the issue
Prabhu Capital Limited is issuing the closed-ended mutual fund scheme "Prabhu Smart Fund" from today i.e. on 18th Falgun and will close on 23rd Falgun, 2079. If not subscribed fully by the early closing date, the issue can be extended till Chaitra 05.
8 crore unit shares will be issued at a par value of Rs. 10 per unit. 14% of the total units i.e. 1.12 crore units worth Rs. 11.2 crores have been allocated to the fund promoter Prabhu Bank Limited whereas 1% of the total units i.e. 8 lakh units have been allocated to the fund manager Prabhu Capital Limited. Thus, the remaining 6.80 crore units will be allocated to the general public.
"Prabhu Smart Fund" is a closed-end fund, meaning it can be traded in NEPSE. The fund has a maturity period of 10 years. Applicants can apply for a minimum of 100 units to a maximum of 80 lakh units.
Currently, Prabhu Capital is managing one closed-end fund i.e Prabhu Select Fund (PSF) in the market.
Click here for the offer letter
| Prabhu Smart Fund | |
|---|---|
| Fund Size | Rs. 80 Crores |
| Per Unit Price | Rs. 10 |
| Total Units | 80,000,000 |
| Fund Sponsor | Prabhu Bank Limited |
| Fund Manager and Depository | Prabhu Capital Limited |
| Seed Fund by Prabhu Bank - 14% (units) | 11,200,000 |
| Seed Fund by Prabhu Capital - 1% (units) | 800,000 |
| General Public (units) | 68,000,000 |
| Nature of Scheme | Close-ended Fund |
| Fund Maturity | 10 years |
| Minimum units to be applied | 100 |
| Maximum units to be applied | 8,000,000 |
| Issue open date | 18th Falgun |
| Issue closing date (earliest) | 23rd Falgun |
| Issue closing date (latest) | 5th Chaitra |
| ICRA Ratings of Prabhu Bank | [ICRANP-IR] BBB |
| CARE ratings of Prabhu Capital | CARE-NP AMC Quality 3 (AMC 3) |
| Minimum units that needs to be sold | 40,000,000 |
| Maximum units that can be extended | 100,000,000 |
Dividend Payout
The dividend will be paid out of realized profits in proportion to investments made on a yearly basis. The Retained earnings will be re-invested if any.
Fund Management Team of PSMF:
| S No. | Name | Qualification |
|---|---|---|
| 1 | Mr. Dinesh Thakali | CA, MBS, LL.B |
| 2 | Mr. Basu Thapaliya | BBS |
| 3 | Mr. Durga Nanda Jha | MBA, CFA, FRM |
| 4 | Mr. Anish Shrestha | FCCA, MBS |
| 5 | Mr. Bhawan Karmacharya | MBS |
| 6 | Mrs. Basanta Upadhyaya | BBS |
Capital structure of Prabhu Capital:
| Particulars | Amount |
|---|---|
| Authorized Capital | Rs. 1.11 Arba |
| Issued Capital | Rs. 1.11 Arba |
| Paid-up Capital | Rs. 1 Arba |
Board of directors of Prabhu Capital:
| S. No | Name | Position |
|---|---|---|
| 1 | Mr. LP Bhanu Sharma | Chairman |
| 2 | Mr. Dinesh Thakali | Managing Director |
| 3 | Mrs. Jyoti Sherchan | Director |
| 3 | Dr. Bharat Singh Thapa | Director |
| 4 | Mr. Naresh Jung Thapa | Director |
| 5 | Mr. Bhupindra Khattri | Director |
| 6 | Mr. Rabindra Dhakal | Director |
General Asset Allocation of the proposed scheme's portfolio:
| S.N. | Type of Instrument | Normal Allocation (of Net Assets) | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Year 6 | Year 7 | Year 8 | Year 9 | Year 10 | ||
| 1) | Fixed income | 15% | 15% | 15% | 15% | 15% | 15% | 15% | 15% | 15% | 15% |
| 2) | Debentures and Bonds | 10% | 10% | 15% | 18% | 20% | 20% | 18% | 15% | 15% | 15% |
| 3) | Investment in Ordinary shares | 50% | 65% | 65% | 62% | 60% | 60% | 62% | 65% | 60% | 45% |
| 4) | Money at Call and Short Notice | 25% | 10% | 5% | 5% | 5% | 5% | 5% | 5% | 10% | 25% |
| Total | 100% | 100% | 100% | 100% | 100% | 100% | 100% | 100% | 100% | 100% | |
Investment Avenues:
- Securities that are registered with SEBON.
- Securities called for a public offering.
- Securities that are listed in NEPSE.
- Debentures, Treasury Bills, and other instruments of the money market issued by the Government of Nepal or Government Agencies receiving full guarantee or protection of GoN or NRB.
- Bank deposits.
- Money Market Instruments.
- Other areas as prescribed by SEBON.
ICRA Rating (Prabhu Bank Limited):
ICRA Nepal has placed the issuer rating of [ICRANP-IR] BBB& (pronounced ICRA NP issuer rating triple B), assigned to Prabhu Bank Limited (PRVU). The rating indicates a moderate degree of safety regarding the timely servicing of financial obligations.
Key Strengths:
- Competitive funding profile.
- Improved asset quality.
- Improved profitability.
Key Challenges:
- Thin capitalization buffer in terms of tier-I.
- Uncertain operating environment: high exposure to the volatile tourism sector accentuates the concerns.
CARE Ratings (Prabhu Capital Limited):
CARE Ratings Nepal Limited (CRNL) has reaffirmed the Fund Management Quality Rating “CARE-NP AMC Quality 3 (AMC 3)” to Prabhu Capital Limited.
Key Strengths:
- Fund sponsor/ shareholders part of Prabhu Group and established track record of operations in merchant banking.
- The experienced board of directors and management team in merchant and banking services coupled with Professional fund supervisors.
- Moderate Fund Performance
Key Weaknesses:
- Short track record as fund manager under Mutual Fund Regulations, 2010.
- A decline in total operating income during FY22, however an improvement in merchant banking performance.
- Evolving Mutual Fund Industry.
- Limited market diversification and volatile trend of NEPSE index.
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