Adhikhola Laghubitta to soon issue IPO worth Rs.4 Crore; SEBON adds the issue to its pipeline

Securities Exchange Board of Nepal (SEBON) has added proposed IPO issue of Adhikhola Laghubitta Bittiya Sanstha Limited under preliminary review in the latest list of IPO issues in pipeline published.

Adhikhola Laghubitta Bittiya Sanstha Limited is proposing to come out with an IPO of 400,000 equity shares with a face value NPR 100 each, at par. The proposed issue is being made to fulfil the regulatory provision requiring banks and financial institutions (BFIs) to float IPO within three years of coming into operation.

NIBL Ace Capital has been appointed as the issue manager for the proposed IPO issuance.

The microfinance company is looking to raise capital worth Rs.4 Crore through issue of ordinary shares. ICRA Nepal has assigned an [ICRANP] IPO Grade 4, indicating below-average fundamentals to the proposed IPO.

Incorporated in August 26, 2016, Adhikhola Laghubitta Bittiya Sanstha Limited (ALB) started its commercial operation from February 12, 2017, upon receiving license to operate as 10 districts-level class D MFI. As of mid-January 2019, ALB had operations through 19 branches over its 10 licensed districts. ALB is promoted by 38 individual promoters engaged in different professions. Mr. Dolraj K.C is the chief executive officer of the company. The registered and corporate office of ALB is located at Veerkot-1, Syangja district of Gandaki Province in Western Nepal.

ALB reported a net loss of ~NPR 2 million for FY2018, over an asset base of ~NPR 437 million as of mid-July 2018 as against a net loss of ~NPR 6 million during FY2017 over an asset base of ~NPR 108 million as of mid-July 2017. For H1 FY2019, ALB has reported profit after tax of ~NPR 5 million over an asset base of ~NPR 635 million as of mid-January 2019. ALB’s gross NPLs stood at 1.43% and CRAR at 11.13% as of mid-January 2019. On the technology front, ALB uses “Synergy” software which is centralized across all of its branches.