Solu Hydropower Limited's IPO Closed With 3.86 Times Oversubscription

Solu Hydropower Limited had closed the issuance of 82,00,000 units of IPO shares at a par value of Rs 100 on 4th Magh, 2082. The issue had been opened for the general public on 29th Poush, 2082.

The issued capital of the company had stood at Rs 10 Arba. Of this amount, 20 percent, equivalent to 2,00,00,000 unit shares, had been allocated for public issuance. From the total issued capital, 10 percent, or 1,00,00,000 unit shares worth Rs 1 Arba, had already been issued to project-affected locals of Solukhumbu district. Similarly, 10 percent of the general public issue, amounting to 10,00,000 unit shares, had been allocated to Nepalese citizens working abroad.

Out of the general public issue, 3 percent, or 3,00,000 units, had been reserved for the company’s employees, while 5 percent of the total offered shares, equivalent to 5,00,000 units, had been set aside for mutual funds. The remaining 82,00,000 units had been issued to the general public, and the IPO had closed on 4th Magh.

Nabil Investment Banking Limited had been appointed as the issue manager for the IPO issuance. Applications could be submitted for a minimum of 10 units and a maximum of 1,00,000 units.

According to CDSC, 25,70,422 applicants had applied for 3,17,08,390 units. The issue had been oversubscribed 3.86 times.

Infomerics Credit Rating Nepal Limited (Infomerics Nepal) had assigned an issuer rating of IRN BB (Issuer) [Double B (Issuer)]. Issuers with this rating were considered to have a moderate risk of default regarding the timely servicing of financial obligations.

Solu Hydropower Limited (SHL), originally incorporated as a private company in June 2010 and later converted into a public company in July 2022, had initially been majority-owned by Essel Infraprojects Ltd., India, before ownership shifted to Nepalese shareholders. The company had subsequently been promoted by major business groups, including Triveni, Vishal, Goyal, Rathi, Baidya, and Jain. SHL had operated the 82 MW Lower Solu Hydroelectric Project (LSHEP) in Solukhumbu district, which had a 411 km² catchment area, a design discharge of 19.85 m³/s at 40% PoE, and a gross head of 493 meters. As of mid-February 2024, key shareholders had included Govind Lal Sanghai (8.16%), Nitesh Agrawal (7.09%), and Ram Chandra Sanghai (4.93%).