Ghorahi Cement's IPO

Securities Board Makes 4 Decisions About Ghorahi Cement’s IPO; Nepal Police To Investigate Further

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Ghorahi Cement's IPO

Introduction to Ghorahi Cement’s IPO

Ghorahi Cement’s IPO. In the latest developments regarding the public issue of Ghorahi Cement Industry Limited, the Securities Board of Nepal (SEBON) has made four significant decisions. These decisions were taken based on the report submitted by an investigation committee formed to study Ghorahi Cement Industry Limited. This article delves into the details of each decision and sheds light on the implications for the involved parties.

Ghorahi Cement's IPO

1. Abnormally Large Share Applications

The Securities Board of Nepal has identified that certain investors have applied for abnormally large shares without possessing sufficient funds in their bank accounts (Ghorahi Cement’s IPO). These individuals have no affiliation with the directors, employees, issuing company, or the issuing and sales manager. Their intention is to mislead the general public. As a result, the board has recommended Nepal Police to conduct further investigations into this fraudulent activity.

2. Extension of Application Period

Despite receiving an excess number of applications, the Securities Board published a notice extending the time period for purchasing shares. This decision has raised concerns and calls for further investigation. The purpose is to determine the reasons behind extending the application period despite the overwhelming demand.

3. Investigation by ASBA Member NIC Asia Bank Limited

NIC Asia Bank Limited, a member of the ASBA (Applications Supported by Blocked Amount) system, will carry out an investigation into the acceptance of applications without sufficient funds in the applicants’ accounts. The board’s commitment to fairness and transparency is reflected in this decision regarding the application process.

4. Discrepancies in Actions

The Securities Board of Nepal has noticed discrepancies in the actions of the applicants, ASBA member banks and financial institutions, and the issuing and sales manager compared to those of the issuing company. As a result, Rs. 3 Arba 61 crores held, and the shares issued to Nepalese working abroad and the locals of industry-affected areas have been distributed. Additionally, Rs. 29 crores 46 lakhs 78 thousand two hundred and fifty rupees have been transferred to the company’s account. To address points 1, 2, and 3, a thorough investigation is required by the end of fiscal year 2079/80.

Postponed Issue Details

To address the situation, the Securities Board has outlined the following measures for the postponed issue:

a) Registered applications in the C-ASBA system for the public issue of Ghorahi Cement Industry Limited will be allowed to adjust the number of applied-for shares, and withdraw or cancel their applications.

b) A three-day withdrawal or reduction period will be provided from the date of the notice published by the Issuance and Sales Manager.

c) As per sub-rule (2) of rule 10 of the Securities Registration and Issuance Regulations, 2073, if all the issued securities are not sold within the specified period, the organizing organization may keep the application for securities open for a maximum of fifteen days from the date of opening. If all the requested securities are not sold within the extended period of three days, the issue will remain open for an additional seven days after the three-day amendment period.

Ghorahi Cement’s Share Issue and Sales Managers

Himalayan Capital Limited and Nabil Investment Banking Limited are the share issue and sales managers for Ghorahi Cement’s Initial Public Offering (IPO). The responsibility of managing the process and ensuring compliance with regulatory requirements lies with these institutions.

Previous Share Issue of Ghorahi Cement’s

69,11,670 unit shares at a price of Rs 435 per unit (including a premium of Rs 335) as part of its Initial Public Offering to the general public. The issue commenced on the 32nd of Jestha, 2080, with an early closing date set for the 4th of Ashad, 2080. Despite receiving an over-subscription, the company extended the closing date to the 14th of Ashad, 2080.

The offer letter outlined the allocation of shares as follows: 79,43,801 unit shares, which account for 20% of the issued capital, were allotted. Out of this allocation, 77,290 units were set aside for project-affected locals, 606,350 units for Nepalese citizens working abroad, 328,961 units for mutual funds, and 19,530 units for company employees. The remaining shares, after considering all previous allotments and reservations, totaled 69,11,670 units, which were made available for the general public.

In conclusion to Ghorahi Cement’s IPO, the decisions made by the Securities Board of Nepal regarding Ghorahi Cement Industry Limited’s public issue are aimed at addressing irregularities and ensuring the integrity of the process. Through further investigations and necessary actions, the board aims to maintain transparency and protect the interests of the investing public. It is crucial to adhere to the regulatory framework and maintain fair practices within the securities market to foster investor confidence and the growth of the industry.

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