Things to Know Before Applying for IPO of Dordi Khola Jal Bidyut Company, IPO opens from today
Thu, Jun 9, 2022 7:16 AM on IPO/FPO News, Company Analysis, Latest,
Company Profile:
Dordi Khola Jal Bidyut Company Ltd is a public company incorporated on Falgun 14, 2066 (February 26, 2010) as per Companies Act 2063, Nepal with the objective to develop and invest in hydropower projects. It is currently developing a 12 MW Dordi-1 Hydroelectric Project in Lamjung District and owns its generation license. The project is located in Dordi Gaupalika-6, Lamjung. Its registered office is located at Kathmandu -11, Bluestar Complex, Tripureshor. Lamjung Electricity Development Company Limited (LEDCO) holds 84.95% ownership in the company.
About the issue:
Dordi Khola Jal Bidhyut Company Limited (DORDI) will be issuing 21,95,509 unit shares of Rs 100 face value from today i.e 26th Jestha, 2079 to the general public. The company intends to collect Rs 21.95 crore from this IPO. The early closing date of this issue is on 31st Jestha and if the issue is not fully subscribed then it can be extended up to Ashadh 09, 2079.
Out of the total 21,95,509 units; 3% of the total offered shares i.e. 65,865 units have been set aside for the employees of the company and 5% of the total offered shares i.e. 1,09,775 units have been set aside for the mutual funds. The remaining 20,19,869 units are for the general public. The paid-up capital of the company will reach Rs. 1.05 Arba after the IPO issuance.
Earlier, the company had issued 10,54,260 unit IPO shares which is 10% of the issued capital of Rs 105.42 crore to the project-affected locals of Lamjung District from 13th Baisakh to Jestha 05, 2079. However, only 7,56,420 units, or 71.75 % of the total issue have been allotted to the valid applicants.
Thus, the remaining 2,97,840 units unsubscribed shares are added to 18,97,669 units (which is 18% of shares reserved for the general public) to make a total of 21,95,509 units for the general public. Overall, 72% of shares are of the promoter shareholders in the company.
Siddhartha Capital Limited has been appointed as the issue manager for the IPO issuance. Applications can be placed for a minimum of 10 units and a maximum of 17,00,000 units.
| Dordi Khola Jal Bidhyut Company Limited | |||
|---|---|---|---|
| Particulars | Percentage | Units | Amount |
| Total Capital | 100% | 1,05,42,604 | 1,05,42,60,400 |
| Total Issue (General Public) | 18% | 18,97,669 | 18,97,66,900 |
| Issue Manager | Siddhartha Capital | ||
| Issue Open Date | 26th Jestha | ||
| Issue Closing Date (earliest) | 31st Jestha | ||
| Issue Closing Date (Late) | 9th Ashad | ||
| Minimum Application | 10 | ||
| Maximum Application | 17,00,000 | ||
Capital Structure
| Authorized Capital Rs | 2,00,00,00,000 |
| Issued Capital Rs | 1,05,42,60,400 |
| Current Paid-Up Capital Rs | 75,90,67,500 |
| Capital after IPO Issuance Rs | 1,05,42,60,400 |
Shareholding Structure
| Number of Shares | Amount | Percentage | Remarks | |
|---|---|---|---|---|
| Promoters Shareholders | 75,90,675 | 75,90,67,500 | 72% | Already issued |
| Project-affected Locals | 7,56,420 | 7,56,42,000 | 7.18% | Already issued |
| General Public | 21,95,509 | 21,95,50,900 | 20.82% | To be issued |
Board of Directors
| Name | Position |
|---|---|
| Mr. Dipendra Lal Karna | Chairman |
| Mr. Amrit Dimdung | Director |
| Mr. Haribol Bhattarai | Director |
| Mr. Ishwar Tripathi | Director |
Project Information:
| Name of Project | Dordi 1 Jalvidhyut Aayojana |
| Type of Project | Run-of-River |
| Installed Capacity | 12 MW |
| Electricity Generation License received | Magh 12, 2069 |
| Generation Valid Date | Magh 11, 2104 |
| RCOD | Shrawan 4, 2077 |
| Total Cost in Rs | 2,69,44,03,009.70 |
| Cost per Megawatt in Rs. | 22,45,33,584.14 |
Financial Statement:
|
Financial Highlights |
|||||||
|---|---|---|---|---|---|---|---|
|
Particulars |
Actual | Estimated | |||||
| 2075/76 | 2076/77 | 2077/78 | 2078 (Q3) | 2078/79 | 2079/80 | 2080/81 | |
| Total Paid-Up Capital ('000) | 759,067,500.00 | 759,067,500.00 | 759,067,500.00 | 759,067,500.00 | 1,054,260,400.00 | 1,054,260,400.00 | 1,054,260,400.00 |
| Reserve & Surplus ('000) | 15,755,796.19 | 17,284,088.29 | 18,133,306.28 | 18,486,997.96 | 55,519,363.00 | 116,169,527.00 | 194,405,383.00 |
| Debt ('000) | 169,383,087.73 | 170,666,930.74 | 251,297,050.92 | 465,682,988.05 | 101,637,617.00 | 30,460,997.00 | 1,792,682.00 |
| Revenue ('000) | - | - | - | - | 72,089,63.00 | 351,910,394.00 | 362,402,825.00 |
| Interest Expenses ('000) | - | - | - | - | 36,343,125.00 | 143,010,000.00 | 136,147,500.00 |
| Net Profit ('0000) | 9,137,226.32 | 1,528,292.10 | 724,321.29 | 353,691.68 | 50,286,056.00 | 60,650,164.00 | 78,235,856.00 |
| Earnings per share (Rs.) | 1.20 | 0.20 | 0.10 | - | 4.77 | 5.75 | 7.42 |
| Net worth per share (Rs.) | 102.08 | 102.28 | 102.39 | 102.44 | 105.27 | 111.02 | 118.44 |
| Debt-Equity (times) | 0.22 | 0.22 | 0.32 | 0.60 | 0.09 | 0.03 | 0.00 |
| Return on Equity (%) | 0.12 | 0.02 | 0.01 | 0.00 | 0.45 | 0.52 | 0.63 |
ICRA Rating:
ICRA Nepal has reaffirmed an issuer rating of [ICRANP-IR] BB- (pronounced ICRA NP issuer rating double B minus) to Dordi Khola Jal Bidhyut Company Limited. Issuers with this rating are considered to have moderate risk of default regarding timely servicing of financial obligations.
Key Strengths
- Institutional shareholding and prior experience of major promoters/directors in the sector.
- Low project execution risk.
- Low funding risk.
- Low tariff and offtake risks with presence of long-term PPA at predetermined tariffs and escalations.
Key Challenges
- Project cost escalated by ~18% leading to the relatively higher project cost.
- Low evacuation risk.
How much to apply?
When we observe the current scenario, investors have still shown a high level of confidence in IPO despite declining NEPSE, which is shown by the huge demand in the recently concluded IPO.
When we look at the current trend of IPO in the market, we see that more than 20 lakhs of investors have been applying in the recent issue. This shows that, even if a quarter of this number applied for the issue of Dordi Khola Jal Bidyut Company Ltd, the issue will be oversubscribed. Since the "10 kitta rule" still holds true for IPO; 2,19,550 applicants will be lucky enough to get the 10 unit shares of Dordi Khola Jal Bidyut Company Ltd. So, it is advisable to apply only 10 units.
