Sarvottam Cement Limited, which has decided to issue IPO through book building method, has called a special general meeting.

A meeting of the company’s board of directors held yesterday Jesth 25) has convened a special general meeting on Asar 10. The meeting will start at 11 am at Neupane Tower in Tinkune, Kathmandu.

The Meeting will approve the proposal to distribute 20.124 percent of the current paid up capital of Rs. 3.40 billion from the profits of the last fiscal year 2077/78. Of this, 19.118 percent will have a bonus share of Rs. 650 million and 1.006 percent will have a cash dividend of Rs. 3,42,10,526 for bonus share tax purposes.

The same meeting will also pass a special resolution to increase the current issued and paid-up capital of the company and reconcile the capital ratio between the founders and the general shareholders. The meeting will also approve the proposal to make necessary amendments in the management letter and rules as per the arrangement after issuance of bonus shares and matching of capital ratio.

Earlier, the company’s second annual general meeting held on January 19 last year had passed a special resolution to issue IPO through book building method. Accordingly, the company has decided to issue 6 million IPOs worth Rs 600 million, which is 15 percent of the paid-up capital.

Of the total ordinary shares to be issued, 2.4 million shares have been allotted to institutional investors, 800,000 shares to local district residents and 2.8 million shares to company employees and the general public.

The company is confident that the share price will be more than Rs 750 per share after studying the internal valuation and some bases. However, the final price will be determined by the bidding method by the institutional qualified investors, the company said.

The company has projected that 40 percent of the proceeds from the IPO will be used to repay the loan and the remaining amount will double the production capacity and the annual return will be more than 75 percent after four years.

For the IPO issue, the company has appointed Global IME Capital as sales manager and NIBL ​​S Capital and Prabhu Capital as assistant sales managers.

The company seems to be doing better than average for investors as it received an IPO rating of BBB Plus from ICRA. Also, according to the ICRA rating, the company can offer higher returns as the cost of limestone and transportation is lower than other cement industries.


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