Last Day to Apply for Sonapur Minerals & Oil Limited IPO for Locals

Sonapur Minerals & Oil Limited is currently conducting its Initial Public Offering (IPO) in two phases. In the first phase, which started on the 29th day of Shrawan in the year 2080 BS, the company is offering shares to residents of the project-affected areas and Nepali citizens working abroad.

The IPO for Nepali citizens employed abroad successfully closed on the 11th day of Bhadra in the year 2080 BS, with the company selling 10,76,268 shares to foreign-employed Nepali citizens. This allocation accounted for 10 percent of the general public's quota.

The second phase of the IPO, open to local residents, is scheduled to conclude on the 26th day of Bhadra in the year 2080 BS. Originally, the IPO for locals was set to close on the 11th day of Bhadra in the year 2080 BS, but an extension was granted due to lower-than-expected interest during the initial period.

The company has earmarked 5 percent of its issued capital, equivalent to 15,37,525 shares, for residents of Dang and Rolpa districts. Local residents are eligible to apply for a minimum of 10 shares and a maximum of 15,00,000 shares.

Following the conclusion of the local phase, the company intends to offer shares to the general public in the second phase of the IPO. In total, the company plans to sell 25,00,000 shares in the IPO, each with a face value of Rs 100, amounting to a total of Rs 25 crores.

The company is issuing shares to local residents and employees at a price of Rs. 225 per share (comprising a Rs. 100 par value and a Rs. 125 premium). For the Nepali citizens working abroad, the shares were offered at a price of Rs. 237.58 per share (comprising a Rs. 100 par value and a Rs. 137.58 premium).

On the financial side, as of September 11, 2023, according to CDS and Clearing Limited (CDSC), a total of 402 applications have been received for 67,670 unit shares, amounting to Rs. 15,225,750.

Applicants for the IPO must apply for a minimum of 10 shares, while residents from the project-affected areas have the opportunity to apply for a maximum of 1,500,000 shares.

In terms of the IPO rating, Infomerics Credit Rating Nepal has assigned the company an IRN triple B minus issuer rating, indicating a moderate level of risk associated with the company's ability to meet its obligations.

The company's issuing and selling manager is NIBL Ace Capital Limited. Local residents can submit their applications through the designated branch offices of Nepal Investment Mega Bank, Citizens International Bank, Kumari Bank, Shine Resunga Development Bank, Global IME Bank, and Prime Commercial Bank.

Upon completion of the IPO, the general public, along with local residents, will collectively own 40 percent of the company, while the remaining 60 percent of shares will be retained by the promoters.

Sonapur Minerals & Oil Ltd. stands as the largest cement manufacturing company in western Nepal, spanning across a 100-acre plot of land in Bijauri, Dang.