Upper Tamakoshi IPO collection Rs 2.30 arba; last day to apply is 15th Chaitra

ShareSansar, March 6:

Upper Tamakoshi Hydropower Limited (UTHPL) had floated Initial Public Offering (IPO) for the staff of lending institutions from Falgun 11. The IPO was supposed to close on Falgun 25 but was extended till Chaitra 15.

“The reason for this extension of date is to ensure participation of the nation-wide depositors of Employees Provident Fund (EPF). Another reason is that although the IPO was opened for Dolkha residents on Falgun 11, they started applying only after Chaitra 1 because of some differences over share allocation.” said Sushil Kumar Aryal, Deputy CEO of Citizen Investment Trust (CIT). “That is the reason why we had to extend the date for them which made the overall extension necessary because the same IPO cannot have two different closing dates for different categories of investors.”

CIT is one of the issue managers for the IPO. The other issue manager is NCM Merchant Banking Limited.   

According to Mr Aryal, till Wednesday afternoon, the highest number of applications was received from the depositors of Employees Provident Fund. “So far we have received 75,000 forms from the depositors of EPF, and collected approximately Rs 2 arba 10 crore from them,” said Mr Aryal.

From Nepal Electricity Authority, 2,000 employees filed for the IPO with total collection of around Rs 20 crore. Likewise, 200 Nepal Telecom employees have filed application from whom Rs 4,60,000 has been collected. “More telecom employees are expected to submit applications in the coming days. The number of shares each telecom employee can get has been fixed so there is no confusion there,” Aryal said.

Meanwhile, Citizens Investment Trust, Rastriya Beema Sansthan, and many of the employees of the Employee Provident Fund are still under the process of taking a decision about the allocation of shares among themselves.

Mr Aryal pointed out some misunderstanding among EPF depositors about share allocation. “They think the more they invest the more shares they would get, which is simply not true,” said Mr Aryal.

The number of shares set aside for the depositors of EPF is 1,82,99,520 crore kittas. There are slightly more than 4 lakh depositors at the EPF out of which we estimate that around 3 lakhs will definitely apply. In that case, Employees Provident Fund depositors are likely to get only 45-50 kittas, for which they have to invest only Rs 5,000, but they have been investing as much as Rs 5 lakhs.”

Mr Aryal said by Wednesday afternoon Rs 2.30 arba had been collected from the investors associated with lending and promoter companies.

If we look at the trend, we are sure to come across a staggering collection figure by the time the IPO closes, Mr Aryal said.

Collection Centers are listed below:

Some Facts about Upper Tamakoshi

Upper Tamakoshi Hydropower IPO is managed by Citizen Investment Trust and NCM Merchant Banking.

The offer will last till Chaitra 15.

The IPO is the largest in Nepal’s capital market.

EPF, Nepal Telecom, CIT and Rastriya Beema Sansthan have provided loans of Rs 10 billion, Rs 6 billion, Rs 2 billion and Rs 2 billion, respectively, to UTHPL.

The minimum number of shares an individual must apply is 50 units whereas maximum number of shares an individual can apply is 5,000 units.

The 456-megawatt hydropower company has allocated 10.59 million units of shares to the locals of Dolakha, 18,299,520 units to the depositors of the EPF (as of July 30, 2010) and 3,049,920 units to the staff of lending institutions and 4,066,560 units to the staffs of UTHPL and its largest promoter NEA.