Adhikhola Laghubitta IPO closing today: Before investing, see the fundamentals
July 10, 2019 | Investopaper
Adhikhola Laghubitta Bittiya Sanstha Limited is closing its IPO issue from today (Ashad 25, 2076). The issue will remain open until the close of the banking hours today. Due to the oversubscription of shares, the issue closes today. If the issue was not fully subscribed until today, it would extend to Shrawan 20, 2076.
Related: How to apply IPO/FPO/Right Share through Mero Share?
The company is issuing 4 lakh units of share in the initial public offering. The IPO of Adhikhola Laghubitta opened from Ashad 22, 2076.
Investors can submit the application for a minimum of 10 units. The par value of each share is Rs. 100. Likewise, one can apply for a maximum of 2,000 units.
Out of the total IPO shares, employees will get 5,000 shares. Likewise, mutual funds will get 20,000 units of share. The general public will apply for the remaining 3,75,000 shares.
Securities Board of Nepal (SEBON) provided the approval for IPO on Ashad 5, 2076.
NIBL Ace Capital is the issue manager for the IPO.
Until the third quarter of this fiscal year, the company has EPS of Rs. 18.66. The net-worth per share stands at Rs. 106.38.
Financial Position of Adhikhola Laghubitta
Adhikhola Laghubitta was established on Bhadra 10, 2073 as a public limited company. It started its operation as a ‘D’class financial institution from Falgun 1, 2073. Mr. Dol Raj K.C is the current Chief Executive Officer (CEO) of the company.
Branches:
The head office of the company is located in Bhirkot, Shyanjha. The company has the authority to operate in 10 districts, namely, Shyanjha, Palpa, Gulmi, Arghakhachi, Kapilbastu, Rupandehi, Nawalparasi, Kaski, Lamjung and Tanahu. Currently, Adhikhola Laghubitta has 19 branches.
Shareholding Structure after the issue of IPO:
After the issue of the IPO, the promoters will hold 60 percent share of the company. Likewise, the general public will possess 40 percent of the company. The total paid-up capital will increase to Rs. 10 crores after the IPO.
| S.N. | Shareholders | Share Quantity | Ownership percent | Share Amount (Rs.) |
| 1 | Promoter | 6,00,000 | 60% | 6,00,000 |
| 2 | Ordinary/Public | 4,00,000 | 40% | 4,00,000 |
Financial Indicators of Adhikhola Laghubitta along with future projections
Past Performance
Until the end of fiscal year 2074/75, the company had paid-up capital of Rs. 6 crores. The reserves stood at negative 73.67 lakh. Likewise, Adhikhola Laghubitta borrowed Rs. 27.53 crores and collected deposits of Rs. 10.31 crores. Till that period, the company had floated loans of Rs. 34.58 crores. From its operation, the company had a net loss of Rs. 16.36 lakh in 2074/75. The EPS and net-worth per share stood at -Rs. 2.73 and Rs. 87.72 respectively.
Current Performance
Based on the unaudited report until Chaitra end, 2076, the company has paid-up capital of Rs.6 crores. After the issue of the IPO, the company will possess a capital of Rs. 10 crores. Likewise, the company has provided loans of Rs. 60.95 crores until the third quarter. Through its operation, the microfinance has already made a net profit of Rs. 1.12 crores in the first 9 months period. The reserve has become positive with Rs. 38.28 lakh. The EPS and net-worth per share stood at Rs. 18.66 crores and Rs. 106.38 crores respectively.
Future Projections
Adhikhola Laghubitta has no plans to increase its capital until 2077/78. The company has projected the reserve to grow to Rs. 7.71 crores until that period. Similarly, the microfinance plans to increase its loan portfolio by 18%, 40% and 20% in the next three years. Hence, the company projects loans to rise to Rs. 120.48 crores at the end of 2077/78. Likewise, the net profit is expected to rise to Rs. 3.99 crores in 2077/78. The company projects the EPS and net-worth per share to surge to Rs. 39.92 and Rs. 177.10 respectively in 2077/78.
| Particulars | Actual | Chaitra end, 2075/76 | Projected | |||
| 2073/74 | 2074/75 | 2075/76 | 2076/77 | 2077/78 | ||
| Paid-up Capital (Rs. ‘000’) | 19,200 | 60,000 | 60,000 | 100,000 | 100,000 | 100,000 |
| Reserve & Surplus (Rs. ‘000’) | -5,672 | -7,367 | 3,828 | 5,640 | 37,171 | 77,095 |
| Borrowings (Rs. ‘000’) | 80,619 | 275,325 | 379,563 | 436,497 | 654,746 | 851,169 |
| Deposits (Rs. ‘000’) | 13,053 | 103,119 | 194,046 | 242,557 | 291,068 | 334,729 |
| Loans & Advances (Rs. ‘000’) | 70,263 | 345,802 | 609,497 | 718,341 | 1,003,585 | 1,204,813 |
| Net Profit (Rs. ‘000’) | -5,732 | -1,636 | 11,196 | 13,008 | 31,531 | 39,924 |
| Net-worth Per Share (Rs.) | 70.15 | 87.72 | 106.38 | 105.64 | 137.17 | 177.1 |
| Earnings Per Share, EPS (Rs.) | -30 | -2.73 | 18.66 | 21.68 | 31.53 | 39.92 |
