Nepal’s finance ministry has stepped in after serious questions were raised about the IPO of Reliance Spinning Mills. The ministry has told the Securities Board of Nepal to start an immediate investigation into the IPO process and the corruption claims linked to it.
In a letter sent on Poush 1, the ministry said it had noticed many reports in the media about possible irregularities in the book building process used for the Reliance IPO. Because of this, it asked the board to review all actions taken during the share issue and explain what really happened.
Along with the instruction, the ministry also sent copies of complaints it had received from investors. These complaints claim that mistakes were made while approving the IPO. Some even allege that senior officials were influenced by money and that bribery may have taken place during the approval process.
The ministry clearly stated that it expects a proper investigation and necessary action. It also asked the board to report its findings back to the ministry within the given timeframe, as decided by the revenue secretary.
What are the complaints saying?
The complaints filed at the finance ministry make serious accusations against the chairperson of the Securities Board. Investors claim that when the stalled IPO process was restarted, a court order was wrongly explained to justify moving ahead quickly.
According to the complaints, the board rushed the process even though it had the authority to set a new cut off price based on updated financial statements. Investors say this unusual speed raised doubts about the board’s intentions.
Some complaints also allege that the board chair worked closely with Reliance to help the company win its case, without submitting the investigation report that the court had asked for. Investors claim this information was kept hidden from the public, leaving ordinary investors in the dark.
In addition, concerns have been raised about the approval of other IPOs. One complaint mentions Bungel Hydropower, claiming its IPO was approved through illegal means. Investors also allege that several capable companies waiting in the pipeline were ignored, while only selected firms received approval.
With the finance ministry now formally involved, investors are watching closely. Many hope this investigation will bring transparency, restore trust, and ensure that future IPOs follow fair and clear rules.
