Sanima Mai listed at the stock exchange

Sanima Mai Hydropower became the fifth hydel project to be listed at the Nepal Stock Exchange as the company listed Rs 1.05 billion worth 10,550,000 units of share at a face value of Rs 100 per unit.

The listed shares will be traded in a week – from next Tuesday – according to the regulation. The share of the fifth hydropower company at the Nepse is expected to open between Rs 100 to Rs 300 per unit.

Sanima Mai Hydropower is developing two hydropower projects with an aggregate capacity of 29 MW, including the 22-MW Phase I project that is expected to commission in July 2014 and 7-MW Phase II project that is expected to commission in July 2015.

On September 20, 2013, Sanima Mai Hydropower had floated 2.11 million units of primary shares to the public.

The public issue managed by NIDC Capital that was closed on September 24 had seen some 29 times oversubscription to Rs 6 billion.

The hydropower's IPO that was rated ‘[ICRANP] IPO Grade 3’ by Icra Nepal is promoted by NRNs with 70 per cent, locals of Ilam 10 per cent and general public with 20 per cent shares.

Earlier in July 2013, Sanima Mai Hydro had allotted Rs 105 million worth shares to the locals of the project affected areas in nine VDCs of Ilam districts. The locals have the lock-in period of three years, unlike the general public meaning they cannot sell their shares before three years.

Nepal Stock Exchange has already listed National Hydropower, Butwal Power, Arun Valley Hydropower and Chilime Hydropower that share around six per cent of the total market capitalisation of the listed companies.

Sanima Mai Hydro to float shares for locals from Sunday

Sanima Mai Hydropower will float primary shares to locals of Ilam district from May 12.

"The company has separated 1,055,000 units of shares at a face value of Rs 100 per unit, worth Rs 105.5 million, for the locals of nine affected village development committees in Ilam district," according to the company that has assigned NCM Capital as its sales and issue manager for the ordinary shares.

Locals can apply for a minimum of 20 units and a maximum of 1,000 units of ordinary shares, according to the 22-MW hydropower company that has issued capital of Rs 1.05 billion and paid up capital worth Rs 738.5 million. "The company has completed around 70 per cent of its construction till date."

Promoted by Non-Resident Nepalis, Sanima Mai Hydro has upgraded its earlier 15.6 MW capacity to 22 MW.

On March 21, 2012, it had signed a Power Purchase Agreement (PPA) with Nepal Electricity Authority (NEA) for its upgraded capacity.

The entry of Sanima Mai in the secondary market is going to strengthen the hydropower sub-group — among the nine sub-groups — as the current market is largely dominated by banks and financial institutions.

Currently, the hydropower sub-group has only four hydropower companies — Arun Valley Hydropower, Butwal Power Company, Chilime Hydropower and National Hydro — with some 43,877,556 units of shares at a face value of Rs 100 per unit amounting to Rs 4.38 billion.

The entry of the fifth hydropower company that is going to issue its Rs 105.5 million worth primary shares to the locals of some nine village development committees — affected by the hydropower — in Ilam district, in the first phase, will boost the market capitalisation of the hydropower sub-group. It will float Rs 211 million worth primary shares to the general public in the second phase, which will raise the company's paid up capital to Rs 1.58 billion.

Reports fail to rescue hydropower companies

The steep growth in the profit of listed hydropower companies signalling handsome dividends for investors could not rescue the stock market today, as the market dropped by 5.17 points to close at 392.01 points from the morning's opening of 397.18 points.
The hydropower subgroup lost 17.9 points to close at 746.64 points dragging the secondary market index down.
Three among the four listed hydropower companies have registered 54.5 per cent growth in the fourth quarter of the last fiscal year in comparison to the third quarter, according to the unaudited financial results of Arun Valley Hydropower, Butwal Power Company and Chilime Hydropower.
National Hydropower Company — the fourth listed hydro company — last published its quarterly financials till the third quarter of fiscal year 2010-11. The three companies earned Rs 1.5 billion as net profit in the last fiscal year while in the previous quarter their profit stood at Rs 994.45 million.
Likewise, in comparison to fiscal year 2010-11's last quarter they have registered a 29.3 per cent growth in profit when they earned Rs 1.18 billion as net profit.
The hydropower subgroup's index has appreciated by 11 per cent in the last one year following the capital market’s rally since mid-April, 2012. Last week, Nepse witnessed a surge in hydropower stock prices due to rumours regarding the possibility of hydro companies distributing generous dividends, though, from the beginning of this week their stock prices started to decline a little.
The three companies had distributed attractive dividends from the previous fiscal year’s profit. Chilime was one of the highest dividend payers among the listed companies with its 30 per cent cash dividend and 40 per cent stock dividend. Likewise, Butwal Power and Arun Valley distributed 25 per cent and 15 per cent cash dividend, respectively. Dividends are one of the important features that a non-speculative investor regards before purchasing a stock.
Though the three hydropower companies are raking money for investors, National Hydropower is a black sheep in the subgroup. Despite running successful hydro projects, the company's balance sheets show trouble all because of bad corporate governance and embezzlement of funds by the promoters –– NB Group.
The company has not even conducted the annual general meeting of the last two fiscal years despite pressure from shareholders. The good performance of the hydro companies failed to affect the overall market due to its small share in total market capitalisation. The market capitalisation of hydropower companies only stands at Rs 28.3 billion, making only 5.7 per cent of the total market capitalisation.
Meanwhile, National Hydropower seems unlikely to hold its 14th and 15th annual general meetings (AGM) by August 21, as directed by the regulators. A meeting held between the regulators — District Administration Office, Company Registrar's Office and Securities Board of Nepal — had ordered National Hydropower to hold its 14th and 15th AGMs within August 21. It will be highly disappointing if the regulator fails to take action against the company's board even now as it had been putting off its AGM since the last three years. NB Group holds 20 per cent stake in the company and is blamed by shareholders for trying to take the company down and is being held responsible for large scale fund misappropriation.

SAFA Award for Nepali corporate houses

Credit Information Bureau (CIB) bagged the second runner-up award in Best Presented Accounts (BPA) amongst the public sector in the South Asia Federation of Accountants (SAFA) Awards in Dhaka on November 29.
Similarly, Nabil Bank, Standard Chartered Bank Nepal, NIC Bank were awarded with Certificate of Merit under the Banking Sector, while Ace Development Bank and Butwal Power Company were also awarded Certificate of Merit under Financial Service Sector and Manufacturing Sector respectively.
Among the various corporate houses that were awarded with Best Presented Accounts (BPA) in the event held at Dhaka, Bangladesh on November 29 organised by South Asia Federation of Accountants (SAFA), an apex body of SAARC, Nabil Bank was the winner of BPA Award in Nepal with Standard Chartered Bank Nepal as first runner up and NIC Bank as second runner up under Banking Sector Category.
It is not only a satisfying achievement but also substantiates accounting and disclosure practices followed in Nepal and they are in line with international standards, according to the winners.
Similarly, Ace Development Bank, Butwal Power Company and Credit Information Centre were the winner of BPA Award in Nepal in financial service sector, manufacturing sector and public sector entities, respectively.
The president of the Institute of Chartered Accountants of Nepal (ICAN) Sudarshan Raj Pandey expressed happiness with the result of Nepal where more numbers of corporate were awarded with coveted awards.
"Domestic corporate sector has made Nepal proud,” Pandey added.

Chilime to float primary shares to public

Chilime Hydropower is floating 134,4000-unit primary shares to the public from May 31.
The company is floating the shares adding premium of Rs 308.36 in the face value of Rs 100 making a total of Rs 408.36 million that will fetch the company Rs 548.83 million. After the primary issue to the public, the paid up capital of the company will be Rs 960 million.
According to the rule, a company can add premium to its face value, if it is in profit and distributing dividends for last three consecutive years.
Chilime -- which has its Earning Per Share (EPS) stands at Rs 107 -- has been distributing dividends since last five years. It has distributed 60 per cent dividends from last fiscal year's profits.
One of the model hydro companies of the country has appointed Citizen Investment Trust (CIT) and NCM Merchant Bank as its issue and sales managers.
Chilime Hydropower -- with installed capacity of 22.1 MW is a subsidiary company of Nepal Electricity Authority with NEA's 51per cent equity ownership -- is based in Rasuwa district has distributed 10 per cent shares to the locals of project affected area.
It had floated 960,000-unit of ordinary shares to the local people of Rasuwa from November 10 to December 14 last year. Of 960,000-unit set aside for the locals, 636,000-unit was for the locals of project-affected Goljung, Chilime and Syafru Village Development Committees, while the remaining 624,000-unit was for the locals of 15 other VDCs of the Rasuwa district.
The locals of three VDCs of project-affected areas got the shares at a face value of Rs 100 per. Currently, it has listed 7,296,000-unit of shares at the secondary market and is being traded at around Rs 900 per unit. Its total market capitalisation as of today stands at Rs 6,384 million.
The first domestic hydropower company that has been constructed with domestic capital and technical know-how had issued shares to the employees of Nepal Electricity Authority (NEA) as it was NEA’s brainchild.
The Chilime model hs been followed by Upper Tamakoshi Hydropower.
According to the amended Securities Registration and Issuance Regulation – 2065, hydropower companies must float shares for the locals before they open the issue for general public. A company has to float a minimum of 30 per cent of the shares to the public and out of the 30 per cent, five per cent has to be set aside for the company’s staff, 10 per cent for the locals and remaining 15 per cent will be floated to the general public, the amended regulation said.

Hydro pulls Nepse
KATHMANDU: Hydropower sub gruop shed 37.97 points on Thursday to 626.14 points to pull the secondary market index by 2.07 points to close the day's trading at 344.84 points. Butwal Power lost Rs 66 per units share, whereas Chilime Hydro lost Rs 25 per unit share to pull the hydropower sub group that pulled the secondary market.

FNCCI National Excellence Award to StanChart, Lomas Pharma, Nepal Paper

Standard Chartered Bank Nepal bagged the FNCCI National Excellence Award in the large industry category followed by Lomas Pharmaceuticals in the middle industry category and Nepal Paper in the small industry category here today.
Similarly, Unilever won the prestigious FNCCI Service Excellence Award in the large industry category .

Prime Minister Jhalanath Khanal awarded the winners here today the prestigious national awards.

Surya Nepal bagged the People's Excellence Award in the large industry category, whereas Quest Pharmaceuticals and Kumari Bank were awarded People Development Certificate. Butwal Power Company (large industry category) and Nepal Pharmaceuticals Lab (large industry category) followed by Direction Nepal and Quest Entertainment in the middle and small industry category were awarded Service Class Certificate.

Federation of Nepalese Chambers of Commerce and Industry (FNCCI) has awarded the industries for their excellence in sustainable growth and development of an institution in performance.
Earlier, Surya Tobacco (2001), Standard Chartered Bank Nepal (2003) and Surya Nepal (2005) had bagged the coveted award.
Instituted in 2001 by the umbrella organisation of Nepali private sector to promote performance excellence for sustainable growth and development of an institution, this year 15 companies were contesting for coveted honour.
The annual awards is given in three main categories: National Excellence Award is awarded to institutions striving for national excellence; Service Excellence Award is awarded in recognition of organisations that have developed outstanding management capabilities to drive and sustain customer service excellence for business success; and People’s Excellence Award is awarded to organisations that have excelled in developing employees for business success.
The three category is further divided into three — large, medium and small companies — in each giving chance to get recognised as it is based on a comprehensive model focusing on the organisational practices and performances.
The FNCCI National Excellence Award is the only award that has been planned with a scientific approach and is the most reputed because of the screening that a company has to go through to receive it, according to the coordinator of the awards.
Sponsored by Nimbus Group — an agri business group — the award will be more inclusive, increase nationwide participation, yearly awards ceremony, long term partnership with sponsors and progressive recognition for corporate sector.
Earlier, Nabil Bank Ltd, Unilever Nepal Ltd, Nepal Pharmaceuticals Lab Pvt Ltd, Hulas Wires Industries Pvt Ltd, Nepal Paper Products Pvt Ltd, Himalayan Snax & Noodles Pvt Ltd, Himalayan Bank Ltd, Dabur Nepal Pvt Ltd, Asian Paints Nepal Pvt Ltd, Gorkha Brewery and Pashupati Paints Pvt Ltd had won commendations in various years in the past.

Chilime floats primary shares to Rasuwa locals

Chilime Hydropower Company is floating 960,000-unit of ordinary shares to the locals of Rasuwa district -- where the company is located -- from November 10 to December 14.
"After the issue to the locals, the company will float shares for the general public," said Prakash Man Shrestha, manager at the Chilime Hydro.
The Rasuwa-locals can apply for up to a maximum of 200-unit and minimum of 10-unit share. Of 960,000-unit of the shares separated for the locals, 636,000-unit will be for the locals of the project-affected Goljung, Chilime and Syafru Village Development Committees (VDCs), while the remaining 624,000-unit is for the locals of 15 other VDCs of Rasuwa district. The locals of three VDCs of project-affected areas will get the shares at a face value of Rs 100 per unit but others in the district and general public will have to pay Rs 324 per unit, after adding Rs 224 premium at the face value of Rs 100 per unit.
A company that has been regiatering profits for last three consecutive years can add premium at the face value of its shares. Chilime has not only been posting profits but also distributing cash dividends to its sharesholders since last five consecutive years.
The first domestic hydropower company that has been constructed with domestic capital and technical know--how had issued shares to the employees of Nepal Electricity Authority (NEA) as it was NEA's brain child. The company's shares are being traded above Rs 900 per unit currently. The Chilime model is being followed by the Upper Tamakoshi hydropower.
Claiming that they have right to the ownership in the company that is operating in their disctrict, the locals have formed a share struggle committee and filed cases at theSupreme Court for their right to be the shareholders of the company.
According to the amended Securities Registration and Issuance Regulation – 2065, hydropower companies must float shares for the locals before they open the issue for general public. A company has to float a minimum of 30 per cent shares to the public and out of the 30 per cent, five per cent has to be separated to the company’s staff; 10 per cent to the locals and remaining 15 per cent will be floated to the general public, the amended regulation said. "However, the locals share has a lock-in period of three years."
Thus the locals of Rasuwa districts cannnot sell the Chilime Hydropower shares within three years.
Securities Board of Nepal (Sebon) has amended the regulation to encourage the local participation in the hydro projects. The hydropower companies require a longer construction periods but they can float the shares to the public even during the construction phase provided it has obtained operating licence, and completion of one year’s audit and AGM.
Currently, there are only four listed hydropower companies -- National Hydropower, Butwal Hydropower, Chilime Hydropower and Arun Valley Hydropower -- at the Nepal Stock Exchange (Nepse).

The Company
KATHMANDU: Chilime Hydropower Company Ltd (CHPCL) is a subsidiary company of Nepal Electricity Authority (NEA). It was established in 1996 with the objective of promoting the utilisation of resources within the country for the development of hydropower. Its plant -- with installed capacity of 22.1 MW and located at Rasuwa district -- was built and commissioned by the company on August 25, 2003. In 2008-09, the project had started successsful in delivering 103.3 per cent of the contract energy to NEA. CHPCL is now executing four more hydroelectric projects and thwo of them -- Upper Sanjen Hydroelectric Project (11 MW) and Sanjen Hydroelectric Project (35 MW) construction will be started soon.

Commercial banks, hydro companies propel Nepse

The share holders of commercial banks and hydropower companies gained today as except for the two sub groups all others lost.

The banks sub group propelled the secondary market by 3.84 points to close at 486.6 points after it saw heavy trading in some of the commercial banks. Sunrise Bank (12,340-unit), Lumbini Bank (5,379-unit), Bank of Kathmandu (4,268-unit), Prime Commercial Bank (3,343-unit), Nepal Investment Bank (2,879-unit), NIC Bank (2,255-unit), Kumari Bank (1,469-unit) and Laxmi Bank (1,104-unit) pushed the banking index up by 5.94 points to close the banks sub group at 468.92 points.

Similarly, Butwal Hydropower (2,196-unit) and Arun Valley Hydropower (1,294-unit) along with Chilime Hydropower (400-unit) shares were traded at the market, pushing the sub group by 2.04 points to 726.13 points.

However, the Asian Life Insurance that saw 6,220-unit of its shares being traded could not lift the insurance sub group as the sub group lost 0.37 point to close at 569.58 points.

Meanwhile, the year on year (y-o-y) Nepse index declined by 32.74 per cent to 444.76 points in the nine months of 2009-10. The index stood at 661.27 in the same period last year.

Likewise, Nepse sensitive index (based on July 2006) stood at 108.65 points in mid April, which was 176.17 points in the same period last year.

The float index -- calculated on the basis of final transaction as of August 24, 2008 as base market value -- remained at 41.88 in mid-April, a contraction of 35.15 per cent compared to the same period last year, according to the central bank's data.

The y-o-y market capitalisation also declined by 18.21 per cent to Rs 344 billion in mid-April. The ratio of market capitalisation to GDP stood at 31.80 per cent, said the central bank. "It was 43.87 per cent in the same period last year."

Of the total market capitalisation, bank and financial institutions accounted for 74 per cent followed by manufacturing and processing companies (1.8 per cent), hotels (1.1 per cent), business entities (0.3 per cent), hydropower (four per cent) and other economic sectors (18.7 per cent).

Total paid up capital of the listed companies stood at Rs 74.26 billion in mid-April -- an increase of 35.82 per cent over a period of one year. The increase was largely due to the additional listing of securities at the secondary market.

In the ninth month of current fiscal, additional securities worth Rs 20.15 billion -- ordinary share of Rs 3.59 billion, bonus share of Rs 3.43 billion, right share of Rs 5.96 billion and government securities of Rs 7.25 billion -- were listed at the Nepse.

The total number of companies listed at the Nepse has increased to 168 in mid-April compared to 157 in the same period last year.

Arun valley increases paid up capital

KATHMANDU: As per the decision of 14th AGM of Arun Valley Hydropower Development Company on December 29, 2009, the company has distributed 40 per cent of the paid up capital that is 686,000-unitbonus shares. The bonus share has been listed on the Nepse on June 9. After the bonus shares, the total paid up capital of the company is Rs 240.1 million. The company is also making a detailed study for a proposed hydro power project at Kabeli B-1, with a capacity of 25 MW. -- HNS

Good response for primary issue of Arun Valley

Arun Valley Hydropower Company received good response to its primary issue. "On the first day yesterday, 7,000 applications worth Rs 160 million were files its Initial Public Offering IPO," said Niraj Giri, director of Securities Board of Nepal (sebon).
It has floated 5,15,000-unit primary shares from yesterday. It has added a premium of Rs 84 to the face value of Rs 100, making it Rs 184 per unit share.
According to the new Securities Board of Nepal (Sebon) regulation, a company can add premium equal to its net worth, if it is in profit and has distributed cash dividend for three consecutive years. Arun Valley has done so. It distributed 20 per cent cash dividend from the profits of last fiscal year.
Arun Valley Hydropower -- that constructed Piluwakhola Hydropower in Chainpur of Sankhuwasabha district -- has been providing 20 per cent cash dividend from the profit over three successive fiscal years.
Interested applicants can apply for a minimum of 50-unit shares of Arun Valley while a minimum 20-unit can be applied for of Chilime Hydropower. The maximum number of units one can apply for of Arun Valley is 50,000 while for Chilime it is 1,000 only. NMB Bank is the sales and issue manager for Arun Valley's primary issue while the issue and sales managers of Chilime's primary issue are NIDC Capital Market and Citizen Investment Trust (CIT).
The company -- established in 1997 and promoted by Guru Prasad Neupane, Jeevan Raj Shakya and Amar Raj Tamrakar -- to develop, build, own and operate hydropower projects, formed joint ventures with companies to build medium and large hydropower projects and develop entrepreneurship for the promotion of the hydropower sector's currently-owned Piluwakhola Hydropower Project (3MW).
The promoters own 12,00,000-unit shares and the remaining 17,15,000-unit shares will be floated for the public. Arun Valley is planning Upper Piluwa Khola Small Hydropower Project (4.5MW), Lower Phemekhola Small Hydropower Project (2.2MW) and Kabeli-B1 Small Hydropower Project (9.8MW). The new investment partner of the hydropower company will be Janata Bank that is promoted by Guru Prasad Neupane and is in the process of getting the licence of a commercial bank.
However, Chilime Hydropower has suspended its much awaited IPO after a court order. It had planned to float its 23,04,000-unit shares from June 15 adding a premium of Rs 223.70 to the face value of Rs 100 per unit, making it a total of Rs 323.70 per unit share.But the locals of Rasuwa, where the hydropower project is located, have locked the project demanding shares and the company has agreed to give them eight per cent shares. Under the new regulation, Sebon permitted Chilime to give five per cent shares only to the locals and they moved court saying it was against the earlier agreement with Chilime.
Today the Court fixed another hearing on Chilime on June 29.

Listed hydropower companies
KATHMANDU: Currently, there are only three listed hydropower companies -- National Hydropower, Butwal Hydropower and Chilime Hydropower -- at Nepal Stock Exchange. After Arun Valley's listing, there will be four hydropower companies. National Hydro Power has listed its 13,851,862-unit shares at a face value of 100 per unit making it a total of Rs 1,385,186,200. Butwal Power Co Ltd has listed its 8,390,577-unit shares at a face value of Rs 100 per unit making it a total of Rs 839,057,700 and Chilime Hydropower Co has listed its 7,296,000-unit shares at a face value of Rs 100 per unit making it a total of Rs 729,600,000. The total number of hydropower companies' shares stands at 29,538,439-units worth Rs 2,953,843,900.

Sebon approves Chilime primary issue

Securities Board of Nepal (Sebon) has approved the much-awaited Chilime Hydropower Company's primary issue of 23,04,000 units. The board permitted Chilime to add a premium of Rs 223.70 to the face value of Rs 100 per unit, making it a total of Rs 323.70 per unit share equal to its networth.
Today its per unit share was traded at Rs 1,125 per unit at the Nepal Stock Exchange Ltd (Nepse) -- the sole secondary market.
According to the new regulation, a company can issue primary shares adding premium if it has recorded profit and distributed bonus for three consecutive years. Chilime last week distributed 35 per cent cash dividends to its shareholders from last year's profits. The model hydropower company, after repeated pressure from Sebon, finally agreed to float its primary shares to the public, though it had sold shares to Nepal Electricity Authority (NEA) staff and started trading in the secondary market according to the then regulation.
Chilime Hydropower -- constructed with domestic technology -- has been long planning to raise Rs 240 million through an equity offering. The Chilime model is an example of how Nepalis can themselves construct hydro power plants by raising money from the domestic market, if the government has a clear vision of utilising the capital market for development purpose.
Chilime Hydropower is the first hydropower company to be listed for share trading at Nepse. The much-vaunted Chilime model will be replicated in the Upper Tamakoshi Hydropower soon. Currently, there are only three listed hydropower companies -- National Hydropower, Butwal Hydropower and Chilime Hydropower -- in the secondary market.
The issue and sales manager of Chilime's primary issue are NIDC Capital Market Ltd and Citizen Investment Trust.
Sebon -- the regulator of the capital market approved the primary issue on the basis of the Due Diligence Certificate the company provided the board.