 |
Nepal’s top mobile network operator is agreed with an attractive valuation, 5.0x Enterprise value over EBIDTA multiple which is lower compared to 5.7x and 8.4x when compared to other South Asian and ASEAN countries. This low valuation multiple compared to other South Asian and ASEAN peers does commensurate the risk that Axiata faces in a politically and economically unstable country. In April 2015, Nepal had been hit by the worst natural disaster since 1934. India’s decision to unofficially blockade Nepal after the Constitution of Nepal came into effect in September 2015 did not help the situation either, as India is Nepal’s largest import partner.
The unofficial blockade has led to an anomaly in the volume of goods passing through the country through its Southern trade points; and as a result there has been a shortage of supplies, in particular energy. However, the 63.2% decrease in imports of petroleum products has led to the decrease in the country’s national trade deficit by 32.4%. In the same period, government expenditure declined by 13% which is attributable to the political unrest in the Terai region and disturbance at major trade points in Nepal.
The shortage of basic supplies such as medicine and fuel has made the post-disaster rebuilding efforts more difficult. Mike Perlis, President & CEO of Forbes Media commented on the current situation of Nepal:
The unofficial blockade has led to an anomaly in the volume of goods passing through the country through its Southern trade points; and as a result there has been a shortage of supplies, in particular energy. However, the 63.2% decrease in imports of petroleum products has led to the decrease in the country’s national trade deficit by 32.4%. In the same period, government expenditure declined by 13% which is attributable to the political unrest in the Terai region and disturbance at major trade points in Nepal.
The shortage of basic supplies such as medicine and fuel has made the post-disaster rebuilding efforts more difficult. Mike Perlis, President & CEO of Forbes Media commented on the current situation of Nepal:
|
Post a Comment