Nepal Securities Board Sets Basis for IPO Premium Pricing
Summary
Nepal Securities Board has set new rules to curb arbitrary premium pricing in IPOs and requires companies to justify prices using scientific valuation methods and clear disclosures. The policy also introduces sector-specific criteria and stronger safeguards for small investors.
Key Points
- Nepal Securities Board has prepared a basis for determining premium pricing for public offerings outside the book-building system.
- Companies will now have to rely on financial analysis, scientific valuation methods, sector-specific criteria, and investor protection when setting IPO prices.
- The new policy requires prospectus disclosures explaining how the price was determined and discourages conflicts of interest in the pricing process.
- Spokesperson Niranjaya Ghimire said the policy was introduced on the suggestion of the Primary Market Reform Facilitation Task Force.
