75 companies upcoming IPO wave could shake secondary market in NEPSE

Nepal’s Securities Board (SEBON) is currently reviewing files from companies seeking IPO approval. Right now, 75 companies are in the pipeline, mostly from the hydropower sector. Together, they plan to raise over NPR 54 billion through more than 374 million shares.

SEBON has tightened its rules. Companies must now have a net worth of at least NPR 90 per share to get approval. Hydropower firms that have not started electricity production cannot issue shares. These measures aim to prevent company founders from raising money early and leaving investors at risk.

Experts say stricter rules will protect investors. Only financially strong companies with operational performance can now enter the market. This reduces the risk of investment losses from companies that cannot deliver returns.

Sector-wise IPO demand

• Hydropower: 37 companies request permission to issue IPOs worth NPR 18.26 billion. Two companies, Century Energy and Numbur Himalayan Hydropower, seek premium-priced IPOs.
• Manufacturing & processing: 16 companies seek approval for NPR 27.04 billion, with six aiming for premium pricing, including Jagdamba Steels, Saurya Cement, and Maruti Cement.
• Others: 10 companies plan IPOs totaling NPR 3.44 billion, with three requesting premium pricing, including Hospital for Advanced Medicine & Surgery, Kailash Helicopter Services, and Chhaya Devi Complex.
• Investment firms: 4 companies seek NPR 3.14 billion, with Shivam Holdings requesting premium IPOs.
• Hotels & tourism: 4 companies, NPR 1.42 billion.
• Microinsurance: 3 companies, NPR 675 million.
• Development banks: Salpa Bikas Bank, NPR 172 million.

The upcoming IPOs, especially from hydropower and manufacturing sectors, could influence trading patterns in Nepal’s secondary market. Investors are advised to carefully evaluate companies’ financial strength and operational readiness before investing.