Shikhar Power Development IPO Closing Today; Issue Oversubscribed 15 Times

Kathmandu — The initial public offering (IPO) of Shikhar Power Development Limited is closing today, Falgun 26, 2082, for the general public. The company had opened the IPO issue on Falgun 17, 2082, offering shares at a par value of Rs. 100 per unit.The company has issued 18,42,600 units of ordinary shares to the general public under this offering. Shikhar Power Development Limited has a total issued capital of Rs. 98 crore, out of which 32.65 percent (32,00,000 shares) is planned to be distributed to the public. From the total public allocation, 9,80,000 shares (10 percent of issued capital) worth Rs. 9.80 crore have been reserved for project-affected locals and transmission line–affected residents of Baglung District based on the Environmental Impact Assessment (EIA) report. The remaining 22,20,000 shares (22.65 percent) are designated for the general public.Out of these 22,20,000 shares allocated for the public, 10 percent (2,22,000 shares) have been reserved for Nepalese citizens working abroad, 2 percent (44,400 shares) for company employees, and 5 percent (1,11,000 shares) for mutual funds. After allocating these reserved portions, the remaining 18,42,600 shares were opened for the general public.Global IME Capital Limited has been appointed as the issue manager for the IPO. Investors were allowed to apply for a minimum of 10 units and a maximum of 10,000 units.According to data from CDSC, the IPO has received overwhelming demand. So far, 24,82,739 applicants have applied for 2,76,40,060 units, making the issue oversubscribed by approximately 15 times. The strong subscription indicates significant investor interest in the company’s shares.Meanwhile, ICRA Nepal Limited has upgraded the issuer rating of Shikhar Power Development Limited from [ICRANP-IR] BB- to [ICRANP-IR] BB, indicating a moderate risk of default in meeting financial obligations. In ICRA’s rating framework, the symbols “+” and “–” are used to indicate the relative position within a rating category, where BB+ represents a higher level and BB– a lower level within the BB category.Shikhar Power Development Limited (SPDL), incorporated in September 2014 and converted into a public company in June 2022, currently has a paid-up capital of approximately NPR 504 million, which is fully held by promoters. Major promoters include Nepal Opportunity Fund-1 (around 20%), Hem Raj Acharya (around 11%), Narayan Prasad Upadhyay (around 11%), and HPS Investment Pvt. Ltd. (around 7%).The company has developed the 4.96-MW Bhim Khola Small Hydropower Project, which is expected to commence commercial operation by January 2025. In addition, the company plans to construct the 6.05-MW Lower Bhim Khola Cascade Hydropower Project in Baglung, which is targeted for completion by June 2027. Both projects are run-of-river hydropower plants designed under 40 percent probability of exceedance (Q40).The estimated development cost of the Bhim Khola Small Hydropower Project is NPR 1.12 billion, while the Lower Bhim Khola Cascade Project is estimated to cost NPR 1.125 billion. Through these projects, the company aims to expand its power generation capacity and create sustainable long-term revenue in Nepal’s growing hydropower sector.