Shiva Shree Hydropower allots IPO to valid applicants; Dispute with underwriters not solved yet

Shiva Shree Hydropower has alloted its IPO on Tuesday. All the valid applicants have been fully allotted.

Siddhartha Capital is the issue manager of the IPO.

Shiva Shree’s IPO issue for the public was only subscribed by 27% due to which the underwriters were expected to sweep the remainder of the issue in the predetermined ratio. As per the agreements that took place in the month of Baisakh, Muktinath Capital Limited (former Vibor Capital) and CBIL Capital were appointed as the underwriters to the issue. However, disagreement occured as underwriters pointed out that full information wasn't provided to them by Shiva Shree Hydropower Company.

Despite the disagreement, SEBON had instructed to move ahead with the allottment and therefore a total of 7.20 lakh units were allotted.

The company had issued 33 lakh 51 thousand 140 units in IPO. It had issued the IPO to general public from Ashwin 16, 2076. The issue received applications for 7.20 lakh units and 26.30 lakh units remain unsubscribed.

The paid up capital of the company after the IPO will be Rs.1.47 Arba. After the issuance of IPO, the promoter shareholders will be holding 75% while the project affected locals will hold 2.31% and the ordinary shareholders will hold 22.69% stake.

CARE Nepal had assigned Grade 4 rating to the IPO issuance indicating below average fundamentals.

Currently, it has been developing ‘Upper Chaku Hydroelectric Project’ of capacity 22.2 MW located at Sindhupalchowk district of Nepal. Per megawatt cost is Rs.22.45 Crore and total cost of project is Rs.4.98 Arba. The normal payback period of project is 9.59 years and discounted payback period is 21.95 years.