Shivam Cement first cement producer to IPO in Nepal

Shivam Cement Ltd is set to issue 5,280,000 units in an initial public offering (IPO) at premium prices after the company received approval from the Securities Board of Nepal (Sebon). It is the first cement producer that is issuing primary shares for the general public.

Shivam Cement will issue 880,000 units, or two per cent of the company’s share capital, at the rate of NPR300 (US$2.75)/unit. The company will also be allowed to issue 4,400,000 units of primary share, or 10 per cent of issued capital, at NPR400/unit.

Sebon spokesperson Niraj Giri said the cement factory was the first of its type to issue the public shares. "The company's move could serve as a landmark for other similar companies to go public," Mr Giri said.  At present, Nepal's stock market is largely dominated by banking and financial institutions.
Following the amendment of Securities Registration and Issue Regulation in 2016, more companies are now looking into the idea of issuing shares to the general public, paving the way for open pricing of IPOs. Through last year’s budget, the government enabled a 15 per cent income tax rebate for firms that issue shares to the public. The 2018-19 budget also encourages companies with a share capital of NPR1bn or more to list on the stock exchange.