Chilime shares oversubscribed
Mon, Jun 6, 2011 12:00 AM on Others,
KATHMANDU, June 6:
Despite continuous poor performance of secondary market and investors’ low confidence, Chilime Hydropower’s primary issue has been oversubscribed by almost eight times.
The company had floated 134,400-unit primary shares worth Rs 548.83 million to the public on May 31 at Rs 408.36 per unit, adding Rs 308.36 premium on the face value of Rs 100 per unit.
“But it has been able to collect Rs 3.85 billion as 101,500 applicants applied for its primary issue, oversubscribing it by almost eight times,” Securities Board of Nepal director Niraj Giri said adding that the paid-up capital of the company will be Rs 960 million, after this primary issue.
Chilime Hydropower — with installed capacity of 22.1 MW is a subsidiary company of Nepal Electricity Authority with its 51 per cent equity ownership — is based in Rasuwa district and is a model hydel project that has distributed 10 per cent shares to the locals.
The Chilime shares are being traded at around Rs 900 per unit currently, making it a blue chip share in the secondary market that plunged today to over six-year low of 327.81 points from today morning’s opening of 333.76 points.
Everest bank lost Rs 102 per unit share, Bank of Kathmandu lost Rs 27 per unit share and Laxmi bank lost Rs 24 per unit share. Nepal Telecom lost Rs 9 per unit share.
“The financial sector dominated market cannot sustain for long,” said Nepse general manager and CEO Shanker Man Singh. “Poor economic growth coupled with absence of real sector’s strong presence made the secondary market less vibrant,” he said, adding that the political chaos has also contributed to its downfall.
Though, we are trying to involve institutional investors like Citizen Investment Trust and Employers Provident Fund to invest, that could stabilise the market, he added.
The Nepse has also asked two brokers to furnish explanation on their suspecting involvement in market manipulation.
Source: THT
Despite continuous poor performance of secondary market and investors’ low confidence, Chilime Hydropower’s primary issue has been oversubscribed by almost eight times.
The company had floated 134,400-unit primary shares worth Rs 548.83 million to the public on May 31 at Rs 408.36 per unit, adding Rs 308.36 premium on the face value of Rs 100 per unit.
“But it has been able to collect Rs 3.85 billion as 101,500 applicants applied for its primary issue, oversubscribing it by almost eight times,” Securities Board of Nepal director Niraj Giri said adding that the paid-up capital of the company will be Rs 960 million, after this primary issue.
Chilime Hydropower — with installed capacity of 22.1 MW is a subsidiary company of Nepal Electricity Authority with its 51 per cent equity ownership — is based in Rasuwa district and is a model hydel project that has distributed 10 per cent shares to the locals.
The Chilime shares are being traded at around Rs 900 per unit currently, making it a blue chip share in the secondary market that plunged today to over six-year low of 327.81 points from today morning’s opening of 333.76 points.
Everest bank lost Rs 102 per unit share, Bank of Kathmandu lost Rs 27 per unit share and Laxmi bank lost Rs 24 per unit share. Nepal Telecom lost Rs 9 per unit share.
“The financial sector dominated market cannot sustain for long,” said Nepse general manager and CEO Shanker Man Singh. “Poor economic growth coupled with absence of real sector’s strong presence made the secondary market less vibrant,” he said, adding that the political chaos has also contributed to its downfall.
Though, we are trying to involve institutional investors like Citizen Investment Trust and Employers Provident Fund to invest, that could stabilise the market, he added.
The Nepse has also asked two brokers to furnish explanation on their suspecting involvement in market manipulation.
Source: THT
