ICRA Nepal has assigned an [ICRANP] IPO Grade 3, indicating average fundamentals to the proposed INPO of United Modi Hydropowr Ltd.. ICRA Nepal Assigns IPO grading on a scale of IPO Grade 1 through IPO Grade 5, with Grade 1 indicating strong fundamentals and Grade 5 indicating poor fundamentals. UMH is proposing to come out with an IPO of 28,75,000 nos. of equity shares of face value NPR 100 each at par. Of the total shares, 11,50,000 shares will be issued to project affected areas while remaining 17,25,000 shares will be issued to the general public and staff.
The assigned grading factors in the reputation of promoter group and their experience in construction/hydropower development in Nepal. With the company’s first project Lower Modi-1 Hydropower Project (10MW) being operational from November 2012, UMH now intends to develop a 10.5 MW Lower Modi-2 Hydropower Project, a cascade project utilizing the tailrace of current project. The grading has taken into account the presence of evacuation infrastructure which substantially reduces the evacuation risks. In addition to this, plans of the company to tap additional streams could improve the operational performance of the operational project as well.