Kathmandu. CARE Ratings Nepal has upgraded the Issue Rating to ‘Double Minus (Issue’) to ‘Double B’ (Issue) rating to Akama Hotel Limited.
Based on this rating, the company has been rated as a medium level of risk in its ability to meet its financial obligations on time. In addition, the company’s long-term bank facilities rating has also been upgraded to ‘Double B’ from ‘Double B Minus’.
The main reasons for the rating improvement include additional self-capital investment in the current fiscal year, the subsequent uppayment of term loans, and the positive improvement in the company’s capital structure and liquidity position.TAG_OPEN_p_18 The company’s future debt burden is expected to decrease significantly due to the debt prepayment, which has strengthened the financial risk profile.
Risks such as cyclical fluctuations, intense competition, geographical concentration and interest rate volatility in the hospitality sector are also taken into account in the rating.TAG_OPEN_p_17 The company’s performance moderated in the first half of the current fiscal year, which was negatively impacted by the GenG performances on September 23 and 24. Cash flow is expected to improve in the coming quarters as interest expenses have come down in recent times.
Factors that strengthen the rating include the support of an experienced and resourceful promoter group (the company is part of the Sanima Group), the strategic location of the hotel, and the incentives given by the government to the tourism sector.TAG_OPEN_p_16 At the same time, the recent revival of tourism in Nepal and the increasing trend in tourist arrivals have made the prospects of the future positive.
Fiscal Year 2080. 81 and 2081. The company’s total operating income remained stable during the 1982 period. In the last fiscal year, it increased to Rs. It reached Rs 22.5 crore. The occupancy rate of the hotel stood at 45 percent last year. This fiscal year 2079. It was better than 30 percent of the 80s. However, by the end of the current fiscal year, the sales rate of rooms has come down to 32 percent. It was limited to Rs 8.80 crore. The main reason for this is the cancellation of bookings due to the agitation in August.
Although the company has incurred losses due to high interest expenses in recent years, it is expected that profit will improve in the coming years as interest expenses will decrease significantly after the advance payment of loans in the current fiscal year.
The capital structure of the company is in the last fiscal year 2081. There has been a significant improvement in 82. The main reason for this is the increase in the tangible net worth of the company by adding self-capital. The company’s overall gearing ratio decreased to 1.08 times by the end of the previous fiscal from 1.21 times in the previous year.
In addition, as of mid-January of the current fiscal year, additional self-capital investment of Rs. 60.90 crore (including premium of Rs. 27.10 crore) has been invested. It has also significantly reduced the company’s debt level. The company’s total debt stood at Rs. It has decreased from Rs 1.12 billion to Rs 51.4 crore on February 11, 2026.
With the addition of its capital during the half-yearly period, the net worth of the company has also increased to Rs. From Rs. 1.02 billion to Rs. It has reached Rs 1.57 billion. The company’s credit risk profile has improved as it is under no pressure to repay any principal until 2029.
The company’s risk profile is expected to strengthen in the medium term on account of stable cash flow from hotel operations and plans to reduce loans further. The liquidity position of the company seems to be satisfactory as it has sufficient cash reserves.
