Upcoming Rights Share In Nepal: 25 Nepali Companies in SEBON Pipeline for Rs 25.47 Billion Issue

The secondary market for stocks in Nepal has been slow lately, but that has not stopped companies from lining up to issue rights shares. Right now, 25 companies are waiting for approval from the Securities Board of Nepal (SEBON) to issue rights shares worth a combined Rs 25 billion and 47 crore.

The interesting part is that SEBON has not had a chairperson for over a month and a half. During this time, approvals for both rights shares and IPOs have been on hold. But companies have kept submitting their applications anyway.

Two companies even applied during this leadership gap. Peoples Hydropower submitted an application to issue rights shares worth Rs 1 arba 9 crore 50 lakh at a 1:1 ratio, meaning existing shareholders would get one new share for every one they already hold. Arun Kabeli Power Limited also applied, asking to issue shares worth Rs 1 arba 94 crore 79 lakh 71 hazar at a 2:1 ratio.

The last company to actually receive final approval was Himalayan Power Partner, which got the green light on Falgun 25 of last year to issue shares worth Rs 53 crore 27 lakh.

Hydropower Companies Lead the Queue

Out of the 25 companies waiting, 23 are currently in the initial review stage. Together, these 23 companies want to raise around Rs 23 arba 91 crore through rights shares.

Hydropower companies make up the biggest chunk of that list. Here is a quick look at what some of them are asking for:

Peoples Hydropower wants Rs 3 arba 20 crore, Modi Energy is seeking Rs 2 arba 61 crore 8 lakh 50 hazar, Sagarmatha Hydropower has applied for Rs 1 arba 77 crore 32 lakh, Arun Kabeli Power wants Rs 1 arba 94 crore 79 lakh, Himalayan Hydropower is asking for Rs 1 arba 9 crore 50 lakh, and Radhi Bidyut has applied for Rs 1 arba 28 crore 52 lakh. Several smaller hydropower companies like Barahhi Hydropower, Mandakini Hydropower, Maikholahydropower, Sayapatri Hydropower, Panchathar Power, Dolti Power, Bhugol Energy, and Manakamana Engineering Hydropower are also on the list with amounts ranging from around Rs 22 crore to Rs 96 crore.

Other Sectors Also in Line

It is not just hydropower companies waiting. Ghorahi Cement Industry Limited has applied for one of the larger amounts, seeking approval for rights shares worth Rs 3 arba 76 crore 74 lakh. Nepal Lube Oil from the same manufacturing sector has applied for a much smaller Rs 14 crore 57 lakh.

From the investment sector, CEDB Holdings Limited wants Rs 56 crore 36 lakh, while NRN Infrastructure and Development Limited has applied for Rs 1 arba 79 crore 81 lakh.

Two hotel companies also feature on the list. Oriental Hotels Limited has applied for Rs 31 crore 55 lakh, and Kalinchok Darshan Limited wants Rs 63 crore.

From other sectors, Muktinath Krishi Company applied for Rs 45 crore 36 lakh, and Nepal Warehousing Company submitted an application for Rs 68 crore 75 lakh.

Insurance Companies Also Waiting

Two insurance companies are at slightly different stages of the review process. Prabhu Mahalaxmi Life Insurance applied for Rs 73 crore 3 lakh 20 hazar, and SEBON has already sent its comments back. The company is now revising its proposed share ratio before resubmitting. Prabhu Insurance Limited from the non-life insurance sector has already answered SEBON’s questions and is now waiting for the next round of review, having applied for Rs 83 crore 50 lakh 13 hazar 544.

Seven Companies Already Got the Nod

While many are still waiting, seven companies have already received final approval during the current fiscal year up to Falgun 25. These companies together raised Rs 4 arba 94 crore 17 lakh 76 hazar 200 through rights shares.

Shivashree Hydropower got approval to collect Rs 1 arba 47 crore 64 lakh. City Hotel Limited received the go-ahead to raise Rs 1 arba 33 crore 92 lakh. River Falls Power got approval for Rs 70 crore. Narayani Development Bank was cleared to raise Rs 26 crore 24 lakh 67 hazar 700. Buddhabhumi Nepal Hydropower received approval for Rs 40 crore. United Ajod Insurance got clearance for Rs 23 crore 10 lakh. And Himalayan Power Partner was approved to raise Rs 53 crore 27 lakh 8 hazar 500.

A Word of Caution from SEBON

SEBON has made it clear that just because a company’s name appears on this waiting list does not mean it has been approved. The board has publicly reminded investors to be careful. A company will only get final approval once it submits complete and transparent financial documents that meet all legal and regulatory requirements. Until then, being on the pipeline list means nothing official.

So while there is clear demand from companies wanting to raise capital through rights shares, investors should wait for formal announcements before making any decisions based on this list.