Ghorahi Cement Industry To Issue IPO Shares At Premium Price To Locals of Dang District and Nepalese Employed Abroad From Baisakh 19

Ghorahi Cement Industry Limited (GCIL) has published an offer letter to issue an Initial Public Offering (IPO) to the project-affected locals of Dang District and Nepalese citizens working abroad.

The IPO issue for the locals and Nepalese citizens working abroad will open on 19th Baisakh to 2nd Jestha, 2080. Note that for the locals of Dang District, if the issue is not subscribed by the early closing date, the issue can be extended till 17th Jestha. However, the issue will not be extended from the early closing date for Nepalese citizens working abroad.

The issued capital of the cement manufacturing company is Rs. 3.97 Arba of which 20% i.e. 79,43,801 unit shares will be issued to the public (including locals, Nepalese citizens working abroad, and the general public). Out of the total issued capital, 1% i.e. 397,190 unit shares have been allocated to project-affected locals of Dang District.

Meanwhile, 19% of the company's issued capital i.e. 75,46,611 unit shares will be issued later for the general public. Of this general public issue, 10% of the shares totaling 7,54,661 units shares have been allocated for Nepalese citizens working abroad, the issue of which will open on the above mentioned date.

The shares will be issued for Rs 400 per unit (including a premium of Rs 300) for the locals and for Rs 435 per unit (including a premium of Rs 335) for the Nepalese citizens working abroad.

Himalayan Capital Limited as well as Nabil Investment Banking Limited has been appointed as the issue manager. The promoter-public share ratio will be 80: 20 after this IPO. This IPO issue will generate Rs. 3.44 Arba for the company.  Out of this Rs 2.645 Arba will be a premium amount and the rest would add to the paid-up capital.

For the project-affected locals, the minimum application quantity is 10 units while the maximum quantity is 100,000 units. Meanwhile, for Nepalese citizens working abroad, the minimum application quantity is 10 units while the maximum quantity is 754,661 units.

CARE Ratings Nepal Limited (CRNL) has assigned a rating of `CARE-NP BBB- (Is)’ to Ghorahi Cement Industry Limited. Issuers with this rating are considered to offer a moderate degree of safety regarding the timely servicing of financial obligations, in Nepal. Such issuers carry moderate credit risk.

Ghorahi Cement Industry Private Limited (GCIL) was incorporated on August 6, 2007, and its integrated cement manufacturing plant is situated in the Dang Valley of Western Nepal. The company was converted into a public limited company in March 2021 and the name has been changed to Ghorahi Cement Industry Limited (GCIL). GCIL is presently engaged in manufacturing and selling cement with a clinker capacity of 1,900 MTPD and a grinding capacity of 2,200 and has completed brownfield expansion enhancing a clinker capacity of 3,000 MTPD and grinding capacity of 1,400 MTPD. GCIL sells its product under the brand name “Sagarmatha” all over Nepal with a primary focus on the western and far western parts of the country. GCIL sells its product in the market through its 21 distributors all over Nepal.

GCIL has an operational track record of more than 9 years in cement manufacturing and is promoted by two leading business groups of Nepal being Sanghai family brothers (Triveni Group) and Vishal Group. Both groups are involved in diversified businesses of banking, insurance, manufacturing, trading, and other businesses. Sanghai family has around 2 decades of experience in cement manufacturing and currently has been operating standalone grinding units. Vishal Group also has a considerable presence in the financial sector of Nepal and is the promoter of banks. Also, Vishal Group has a strong presence in the import and trading of fast-moving consumer goods in Nepal with an established distribution network. The company has five directors on its board and is chaired by Mr. Purshottam Lal Sanghai. The Chairman is supported by a team of qualified professionals in all the departments with wide experience in the cement industry

Offer Letter