IPO of Hathway Investment Nepal Opens From Today; A Thorough Look Into Company Performance and Vital Fundamentals
Thu, Sep 7, 2023 6:48 AM on IPO/FPO News, Company Analysis, Latest,
Company Profile:
Hathway Investment Nepal Ltd. (HINL) is Nepal’s first private-equity investment company that has impacted investment objectives. HINL invests in all sectors which has potential and has a positive impact with solutions to existing problems employment creation or contribution to the local economy. The company’s investment combines risk capital financing with advisory support to help the investee develop systems, processes, standards, relationships, networks, and governance frameworks, if necessary. Founded in 2009, Hathway is a provider of private equity to the capital market, tourism, infrastructure, financial sectors, and SMEs. HINL’s renewed focus on equity investment is to support SMEs throughout Nepal with a catalyst to change management.
About the issue:
Hathway Investment Nepal Limited is opening the issue of 24,27,750 unit shares with a face value of NPR 50 per share to the general public from today i.e. on 21st Bhadra, 2080. The early closing date of this issue is on 25th Bhadra and if the issue is not fully subscribed, it can be extended up to 4th Ashwin, 2080.
The issued capital of the investment company is Rs. 1.17 Arba of which 12.50% i.e. 29,25,000 unit shares is for the public (Nepalese citizens working abroad and the general public). Out of this total issue, 10% i.e. 292,500 unit shares were allocated for Nepalese citizens working abroad, whereas 2% i.e. 58,500 units have been set aside for the employees of the company and 5% of the total offered shares i.e. 146,250 units have been set aside for the mutual funds. The remaining 24,27,750 units are for the general public.
Global IME Capital Limited is appointed as the issue manager. Applications can be placed for a minimum of 20 units and a maximum of 100,000 units.
The issue will raise Rs. 14.625 crores for the company since each share will be issued at a face value of Rs. 50 per share. The current paid-up capital of the company is Rs. 1.023 Arba which will reach Rs 1.17 Arba after IPO allotment.
Click here for the offer letter
| Hathway Investment Nepal Limited | |||
|---|---|---|---|
| Particulars | Percentage | Units | Amount |
| Total Capital | 100% | 23,400,000.00 | 1,170,000,000.00 |
| Total Issue (General Public) | 12.50% | 2,925,000.00 | 146,250,000.00 |
| Issue Manager | Global IME Capital | ||
| Issue Open Date | 21st Bhadra | ||
| Issue Closing Date | 25th Bhadra | ||
| Issue Late Closing Date | 4th Ashwin | ||
| Minimum Application | 20 | ||
| Maximum Application | 100,000 | ||
Capital Structure:
| Authorized Capital | 1,500,000,000 |
| Issued Capital | 1,170,000,000 |
| Current Paid-Up Capital | 1,023,750,000 |
| Capital after IPO Issuance | 1,170,000,000 |
Shareholding Structure:
| Number of Shares | Amount | Percentage | Remarks | |
|---|---|---|---|---|
| Promoters Shareholders | 23,400,000.00 | 1,170,000,000.00 | 87.50% | Already issued |
| General Public (Including Nepalese citizens working abroad) | 2,925,000.00 | 146,250,000.00 | 12.50% | To be issued |
Uses of Funds:
| S. No. | Particulars | Amount |
|---|---|---|
| 1 | Invest in hydropower production, transmission, and distribution companies. | Rs. 6 Crores |
| 2 | Invest in organizations related to economic infrastructure, transportation, and communication | Rs. 8.62 Crores |
| Total | Rs. 14.62 Crores | |
Investors:
| Name | Position |
|---|---|
| Yogeshwor Sharma Dhakal | Chairman |
| Kumar Paudel | Director |
| Suraj Kumar Shrestha | Director |
| Jayaram Nepal | Director |
Financial Highlights:
| Financial Highlights | |||||||
|---|---|---|---|---|---|---|---|
| Particulars | Actual | Estimated | |||||
| 2076/77 | 2077/78 | 2078/79 | 2079/080 (Q3) | 2079/80 | 2080/81 | 2081/82 | |
| Total Paid-Up Capital ('000) | 819,000.00 | 819,000.00 | 819,000.00 | 1,023,750.00 | 1,023,750.00 | 1,170,000.00 | 1,170,000.00 |
| Reserve & Surplus ('000) | 231,383.00 | 1,302,988.00 | 923,274.00 | 627,194.00 | 707,782.00 | 893,221.00 | 1,163,319.00 |
| Debt ('000) | - | - | - | - | - | - | - |
| Revenue ('000) | 964,166.00 | 3,428,037.00 | 1,275,619.00 | 8,163.00 | 18,024.00 | 142,867.00 | 176,904.00 |
| Interest Expenses ('000) | 74,889.00 | 42,414.00 | 27,944.00 | 30,038.00 | 38,835.00 | 25,486.00 | 18,579.00 |
| Net Profit ('000) | 23,401.00 | 560,265.00 | 195,767.00 | 3,471.00 | 26,809.00 | 135,169.00 | 169,556.00 |
| Earnings per share (Rs.) | 1.43 | 34.20 | 9.56 | 0.17 | 1.31 | 5.78 | 7.25 |
| Net worth per share (Rs.) | 64.13 | 129.55 | 95.09 | 80.63 | 84.57 | 88.17 | 99.71 |
| Debt-Equity (times) | - | - | - | - | - | - | - |
| Return on Equity (%) | 0.22 | 2.64 | 1.12 | 0.02 | 0.15 | 0.66 | 0.73 |
ICRA Nepal:
ICRA Nepal has assigned a long-term rating of [ICRANP] LBBB- (pronounced ICRA NP L triple B minus) to the long-term bank limits and reaffirmed the short-term rating of [ICRANP] A3 to the short-term bank limits of Hathway Investment Nepal Limited. ICRA Nepal has also reaffirmed the issuer rating of the company at [ICRANP-IR] BBB- (pronounced ICRA NP issuer rating triple B minus).
Credit strengths
- Experienced and diversified promoter profile.
- Strong capitalization profile and adequate liquid assets to debt ratio.
- Long track record of operations.
Credit Challenges
- Exposure to market risk.
- Regulatory risk.
- Sizeable investments in relatively less liquid promoter shares.
