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10 Upcoming Initial Public Offerings (IPOs) in Nepal

Updated on August 16, 2017
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Roberto is a research analyst for a stock brokerage company in Nepal. He has been writing about the Nepali stock market since 2013.

Over Rs 2 Billion Worth of IPOs Are in the Pipeline

Rasuwagadhi Hydropower Company Limited has applied to the Securities Board of Nepal (SEBON) to issue Rs 1.64 billion worth of IPO shares, the second-largest IPO in the history of Nepal ever. Nine other companies are in the review process for floating their initial public shares to the general public.

Since investing in IPOs in Nepal (i.e. primary market) is the safest stock investment option, investment in IPOs is a relatively quicker way to get more returns.

Why Is Investing in IPOs in Nepal Safe and Quick?

When IPO shares are allotted and listed in Nepal Stock Exchange (NEPSE), they can be freely traded. As per the provision, the range of the first transaction in NEPSE is within three times the company's book value. For example: if a company's book value per share is Rs 70, it can be traded within Rs 70 to Rs 210 range for the first transaction. If we analyze the history, all stocks begin their first transaction at the "three times" mark. So, one can easily triple their money as the IPO shares are sold for Rs 100 in Nepal.

SEBON has also made it mandatory for the shares to be allotted within 20 days and listed within two months. This will make it easier for investors to double/triple/quadruple their initial investment with enough knowledge. Further, at least 10 shares are guaranteed in IPO. Lottery system will only be used if there are not enough shares to allot every applicant a minimum of 10 shares.

Upcoming IPOs in Nepal (2017) - Hydropower Companies

S.N.
Company
No. of IPO shares
Total IPO amount (Rs.)
IPO Price per share (Rs.)
1
Laughing Buddha Power Limited
9,78,000
9,78,00,000
100
2
Akhukhola Jalabidhyut Company Limited
800,000
80,000,000
100
3
Garjang Upatyaka Hydropower Limited
200,000
20,000,000
100
4
Joshi Hydropower Development Company Limited
371,400
37,140,000
100
5
Shuvam Power Limited
200,000
20,000,000
100
6
Union Hydropower Limited
633,745
63,374,500
100
7
CEDB Hydro Fund Limited
2,289,300
228,930,000
100
8
Sanjen Jalavidhyut Company Limited
8,760,000
876,000,000
100
9
Rasuwagadhi Hydropower Company Limited
16,421,040
1,642,104,000
100
10
Panchakanya Mai Hydropower Limited
1,100,000
110,000,000
100

How to Apply for an IPO

When any IPO is approved by the Securities Board, the issue manager (merchant banker appointed to manage the issue of initial public offering shares on behalf of the company) publishes the timeline of the issue in a national daily newspaper. Typically, the IPO application collection duration lasts for 4 days.

Interested applicants must apply for a minimum of 50 shares (i.e. Rs 5,000 at Rs 100 per stock). By visiting any of the ASBA-approved banks in Nepal, one can apply for the IPO. Apart from IPOs, applicants can also apply for Further Public Offerings and initial offering of mutual funds in Nepal through ASBA-approved banks and financial institutions.

Upcoming IPOs in Nepal - Microfinance Companies

S.N.
Company
No. of IPO shares
Total IPO Amount (Rs.)
IPO Price per Share (Rs.)
1
Support Microfinance Bittiya Sanstha Limited
600,000
60,000,000
100
2
Samudayik Laghubitta Bittiya Sanstha Limited
300,000
30,000,000
100
3
Unnati Microfinance Bittiya Sanstha Limited
165,000
16,500,000
100

How safe, in your opinion, is investment in Initial Public Offerings in Nepal?

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Recent IPOs and Their Market Price

Company
Last date of IPO issue
Date when the market price hit triple the investment price
Time
United Modi Hydropower Limited
March 6, 2017
May 30, 2017
7.5 months
Samata Microfinance Bittiya Sanstha Limited
January 6, 2017
June 19, 2017
6.5 months
Chhyangdi Hydropower Limited
June 1, 2017
August 3, 2017
2 months
Swadeshi Laghubitta Bittiya Sanstha Limited
April 11, 2017
August 10, 2017
4 months
Synergy Power Development Limited
December 28, 2016
May 21, 2017
5 months
Forward Community Microfinance Bittiya Sanstha Limited
January 25, 2017
May 21, 2017
5 months
Arun Kabeli Power Limited
October 28, 2016
April 16, 2017
5.5 months
Dibyashwari Hydropower Limited
June 30, 2016
February 14, 2017
8 months
Khanikhola Hydropower Company Limited
June 1, 2016
January 12, 2017
6 months
Mero Microfinance Bittiya Sanstha Limited
March 24, 2016
September 5, 2017
5.5 months
RSDC Laghubitta Bittiya Sanstha Limited
August 24, 2016
February 8, 2017
5.5 months
Taking into consideration as Initial Investment amount = Rs 100 and Triple = Rs 300 per share

© 2017 Roberto Eldrum

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      sk111111 8 days ago

      how to apply for promoter shares???

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      mahesh 2 months ago

      would it possible to provede ipo grading also