CEDB Hydropower Development Company is going to issue IPO from last Friday, April 30. 25 lakh 18 thousand 230 ordinary shares at the face value of Rs. 100 per share will be issued. Out of which, the company has allotted 2 percent or 50 thousand 365 shares to the employees and 125 percent 911 shares to the mutual fund. The general public can apply for the remaining 2.341 million 954 shares.
About CEDB:
CEDB Hydropower Development Company is the former CEDB Hydro Fund Limited. As per the Companies Act 2063, Manshir is a company registered in the office of the Registrar of Companies on the 15th of Mansir 2066 BS. The Registrar's Office of CEDB is located at Kathmandu Metropolitan City-11, Tripureshwor.
Two hydropower projects are being implemented in Lamjung district with the investment of CEDB by constructing 4.40 MW Radhi Power Company and 0.18 MW Sage Khola Hydropower Project. Three projects including Rapti Hydro and General Construction Limited, Dordi Khola Hydropower Limited, and Khare Khola Hydropower Company Limited are being constructed with the investment of CEDB.
A 45 MW Kasuwa Khola Hydropower Project is also under construction in Sankhuwasabha Makalu Gaonpalika-02 with the investment of CEDB. Established in 2009, CEDB Hydropower Limited has earnings per share of Rs 13.05 and net assets per share of Rs 138.79.
CEDB has managed to distribute 10.54 percent cash dividend in FY 2075/76 and 7.37 percent in FY 2076/77 and has projected to pay dividends in the coming fiscal year as well.
After the sale of ordinary shares, the share ratio of the founder and the general public will be 70:30. At present, the paid-up capital of this company is 587.59 million. After the sale of ordinary shares, the paid-up capital of the company will be Rs. 839.41 million.
CEDB has issued 25 lakh 18 thousand 230 shares equal to 30 percent of the issued capital i.e. Rs. 251.82 million. The capital raised by issuing IPO will be the development investment of the projects put forward for construction by the company.
As CEDB expands its services, capital will also be used to increase investment and expand financial and economic activities. The company has stated that it has issued IPO to fulfill the objectives mentioned in the management letter and rules of CEDB.
CEDB has made future plans and strategies to grow its business and services. The main objective of the company is to establish itself as a leading company for surveying, producing, and distributing hydropower projects for the development, expansion, and promotion of the hydropower sector.
CEDB plans to invest the proceeds of the IPO in Rapti Hydro and General Construction.
Similarly, CEDB has adopted a strategy of strengthening the financial system, obtaining and developing survey permits for new hydropower projects, and identifying strategic partners to mobilize various financial resources.
Anil Kumar Rungta is the Chairman of the CEDB Board of Directors. Similarly, Ramesh Prasad Nepal, Ayusha Shrestha, Uttam Bhlon Lama, and Vinay Kumar Todi are on the committee. At present, the board of directors of the company has only 5 members from the founding shareholders.
Capital Structure:
At present, the paid-up capital of CEDB is Rs. 587.58 million. The paid-up capital of the company will reach Rs. 839.41 million after the IPO sale to the locals and the general public. The authorized capital of CEDB is Rs. 1.5 billion and the issued capital is Rs. 838.41 million. After the IPO, the company's share ownership will remain at 70 percent of the founder and 30 percent of the public.
How to Apply:
Sunrise Capital Limited is the issue and sale manager for the issue and sale of CEDB's ordinary shares. As 2,518,230 ordinary shares at the face value of Rs. 100 per share will be issued. Interested investors will be able to apply for investment in ordinary shares online through C-ASBA Member Banks and Financial Institutions and MeroShare. The company has stated that the issuance of ordinary shares of the CEDB will be closed early on 4th May 2021, Tuesday (21st Baishakh, 2078) and will be closed lately on 14th May 2021, Friday (31st Baishakh 2078).
Average risk rating:
Care Rating Nepal has given Care NP Double B IS rating to the IPO issued by CEDB. This indicates an average risk in CEDB's ability to bear responsibility. CARE Rating Nepal had given a rating to CEDB's IPO on Ashoj 19, 2077. The rating will be valid for one year from the date of issue.
