What do major indicators of Butwal Power Company Limited say about the company? Look at some key details

Thu, Jul 25, 2019 1:01 PM on Company Analysis, Exclusive, Featured,

Butwal Power Company Limited

Symbol: BPCL

Sector: Hydropower

No. of Outstanding Shares: 24,405,550

Introduction

Butwal Power Company, one of the leading companies in Nepal’s hydropower sector, was established in 1966 as Private Sector Company and then converted into public limited in 1993. It believes on operational excellence, corporate citizenship, good governance and creating value for its shareholders.

Associates

1. Hydro Lab Private Limited (HLPL)

2. Himal Power Limited

Subsidiaries

1. Nyadi Hydropower Limited (NHL)

2.Nepal Hydro & Electric Limited (NHE)

3.Khudi Hydropower Limited (KHL)

4. Kabeli 'A' Hydro Electric Project

5. Hydro Consult Engineering Limited

6. BPC Service Limited (BPCSL)

Board of Directors

Names

Position

Experiences

1. Padma Jyoti

Chairman

More than 16 years of experience in hydropower along 47 years of experience in industrial and business operations.

2. Pradeep Kumar Shrestha

Director

More than 16 years of experiences in hydropower along with 34 years of experience in industries and business operations.

3. Bijaya Krishna Shrestha

Director

More than 11 years of experience in hydropower along with 38 years of experience in the banking, insurance, computer, and electronic sector.

4. Om Prakash Shrestha

Director

More than 8 years of experience in hydropower along with 31 years of experience in the field of construction management and training.

5. Sandip Kumar Dev

Director

24 years experience of public service, Deputy Director General in Department of Electricity Development, GoN

6. Sandip Shah

Director

More than 26 years of experience as hydropower engineer, energy specialist, and project management professional.

7. Mr. Tirtha Man Shakya

Director

More than 34 years of progressive track record of work experiences in different job positions in NEA and others since 1975.

8. Mr. Dinesh Humagain

Director

15 years of experience in Nepalese Stock Market (NEPSE).

9. Bijay Bahadur Shrestha

Alternate Director

More than 16 years of experience in hydropower along with 34 years in export sectors and 18 years in the capital market, financial and insurance sectors.

10. Mr. Sanjib Rajbhandari

Alternate Director

30 years of experience in IT sector

(Source: website of BPCL)

Financial Indicators

Particulars

Indicator

FY15/16

FY 16/17

FY 17/18

Q3 18/19*

Paid up Capital

NPR

1,673,222,700

1,810,572,000

2,218,672,000

2,440,560,000

Reserve and Surplus

NPR

1,970,981,727

2,581,887,172

4,291,524,889

4,361,628,000

Bonus Shares

Percent

7

0

10

              -

Cash Dividend

Percent

20

20

18

              -

Earnings per Share

NPR

34.57

37.02

36.33

40.40

P/E Ratio

Times

25.86

16.75

12.06

8.91

Net Worth per Share

NPR

238

243

293.4

278.71

(*Earning per share and P/E ratio are annualized, 2018/19 indicators are of 9 months only, till Chaitra of FY 2075/76).

Facts and Figures

Source: Annual and Quarterly report of BPCL

Note: All the data plotted in the figures above for the last period 2018/19 include only 9 months data (up to Chaitra of 2075), due to which income from sales of electricity and ROE have shown downward trend. Based on the third quartile data, the annualized income from sales of electricity would be Rs. 706,398,667 with the CAGR of 6% and net profit would be Rs. 1,001,164,000 with the CAGR of 17% in 4 years.

Financial Indicators of BPC’s Subsidiaries

Particulars

FY 2017/18

NHE

HCEL

Khudi

Nyadi*

BPCSL

KEL*

Paid up Capital

139,530,000

14,723,100

84,000,000

555,000,000

10,000,000

1,085,014,947

Reserve and Surplus

270,922,895

87,727,746

120,144,861

-22,320,291

5,056,972

-15,188,835

Net Profit

47,408,532

26,623,805

27,695,910

-6,766,213

1,173,947

-5,336,602

EPS

33.98

180.83

32.97

-1.22

11.74

-0.49

*30 MW Nyadi Hydropower Project and 37.6 MW Kabeli-A Hydroelectric Project are under construction.

Key Indicators of BPCL (V/s Industry)

Price History since FY 15/16 to 2019-07-21

Highest Trading Price: Rs. 1030 (2016-08-01)

Lowest Trading Price: Rs.332 (2019-03-03)

Highest Closing Price: Rs. 995 (2016-07-31)

Lowest Closing Price: Rs. 336 (2019-03-03)

52-weeks High: Rs. 496

52-week Low: Rs. 332

Monthly Stock Outlook

Based on its stock performance since 2011, (BPCL) Butwal Power Company Limited has closed higher in 77.78 % of May months. In terms of price change, it has gained the most (5.61 % on average) in Apr month.

Measurement of Investment Risk (VAR)

 

Measurement of Systematic Risk (Beta)

During this year, it is expected that the company’s net profit would reach to Rs. 1 billion, an increase of 28% compared to previous years. So, it could be expected that, this year BOD would facilitate its investors with handsome bonus and cash dividend.

The Graham number 14.86 (less than 22.5) and PEG ratio 0.77 (less than 1) suggest that the company is undervalued. On the other hand, the Core growth rate of the company is the highest in the industry. So, there is high possibility that the company’s stock may provide good capital gain to its investors in the future.

In the present context, where in annual demand for electricity is growing by around 100 MW nationally and in foreign countries like India and Bangladesh as well, there is a great opportunity for hydropower like BPC and investors. On the other hand, the competitors like Upper Tamakoshi (456 MW), expecting to start its operation from this year may become big threat to BPC.