Bhujung Hydropower has opened the sale of its initial public offering (IPO). In the first phase, the company has issued shares to project-affected locals and Nepalis working abroad, starting Thursday.

Of the total issuance, 10 percent - equivalent to 1 million shares worth Rs 100 million - has been allocated to locals affected by the project. Among these, 60 percent (600,000 shares) is reserved for residents of Kholasothar Rural Municipality-4 in Lamjung, while the remaining 40 percent (400,000 shares) is allocated to locals from wards 1, 2, 3, 5, 6, 7, 8, and 9 of the same rural municipality.

Project-affected locals can apply at a face value of Rs 100 per share until January 1. According to the company, the share sale will remain open until January 16 at the latest. Locals may apply for a minimum of 10 shares and a maximum of 50,000 shares.

The hydropower company has also set aside 100,000 shares for Nepalis employed abroad. Applications from migrant workers will be accepted until January 21.

Bhujung Hydropower has received approval to issue 2 million shares - 20 percent of its paid-up capital of Rs 1 billion. Of this, 20,000 shares are reserved for employees and 50,000 shares for mutual funds.

After allotting shares to locals, the company will issue shares to the general public.

For the IPO, ICRA Nepal has assigned the company an ICRA NP Issuer Rating of Single B Plus, indicating a high risk in the company’s capacity to meet its financial obligations.

Kumari Capital has been appointed as the issue and sales manager for the IPO.

As of mid-July, the company’s net worth per share stands at Rs 90.04, while earnings per share are negative at Rs 10.81. The company has accumulated losses of Rs 50.7 million.

Bhujung Hydropower is currently developing the 7.5 MW Upper Midim Hydropower Project, with a total project cost of Rs 1.80 billion.