Kathmandu, 17th February: The Nepal Electricity Authority (NEA) has once again secured the prestigious 'ICRA NP Double A Plus' rating for the third consecutive year, reaffirming its strong financial position and operational efficiency. This rating, assessed by ICRA Nepal Limited, highlights NEA’s robust financial health, business stability, and low credit repayment risk, making it one of Nepal’s most reliable institutions in meeting economic obligations.
The 'Double A Plus' rating reflects NEA's high capacity to meet financial commitments on time, supported by a comprehensive evaluation of its assets, business risks, financial status, managerial efficiency, and the internal and external factors influencing its operations.
Kulman Ghising, Executive Director of NEA, expressed pride in the achievement, emphasizing that the consistent rating underscores the institution's financial resilience and credibility. "Achieving this rating for three consecutive years highlights our strong financial performance and our ability to meet debt obligations effectively," he said.
Moving Toward Public Share Issuance
In a significant step toward involving the public in its growth journey, NEA has proposed issuing primary shares with a premium added to the base value of its existing paid-up capital, currently standing at NPR 300 billion. The proposed share price is NPR 300 per share, including the premium. The necessary valuation processes have been completed, and once government approval is obtained, the issuance process will commence.
According to Ghising, the funds raised will be allocated to the development of large hydropower projects, with the aim of strengthening Nepal’s electricity production infrastructure. "Proceeds from the share issuance and our profits will be used to expand and improve power production and ensure a more reliable, high-quality electricity supply system," he added.
Financial Turnaround and System Improvements
NEA has demonstrated a remarkable financial turnaround over the past eight years. In FY 2072/73, it reported a net loss of NPR 8.89 billion, but by FY 2073/74, it recorded a net profit of NPR 1.50 billion, initiating a profitable phase. In the last fiscal year (2080/81), NEA achieved a record net profit of NPR 14.46 billion. The institution's cumulative loss of NPR 34.61 billion in FY 2072/73 has been transformed into a cumulative profit of NPR 47.41 billion.
In addition to financial progress, NEA has significantly reduced system electricity leakage, bringing it down to 12.73% in FY 2080/81 from a high of 25.78% in FY 2072/73.
Aiming for Greater Energy Security
NEA’s assets are currently valued at over NPR 700 billion, and its annual revenue has reached NPR 116 billion. This strong financial footing, coupled with the upcoming share issuance, positions NEA to play a pivotal role in Nepal’s energy security and economic development.
With plans to expand hydropower infrastructure and further enhance operational efficiency, NEA is poised to solidify its position as a leader in Nepal's energy sector.
