Sebon fails to penalise National Hydro

KATHMANDU, APR 11: 

National Hydropower Company has failed to heed the directive of the capital market regulator to hold its annual general meeting by mid-April.

“In the recent meeting held by the company’s board, the promoters have expressed their interest to wait till the end of the current fiscal year so that they can hold the AGM of fiscal years 2009-10 and 2010-11 together,” said a board director of the company Prakash Rajoria.

Public shareholders of National Hydropower had formally requested Securities Board of Nepal (Sebon) to fix the date for its annual general meeting as the company had failed to hold one on its own accord, challenging the capital market regulator and fooling investors.

In response, Sebon had directed the company to hold its AGM for fiscal year 2009-10 within mid-April. The deadline expires on Thursday and the company’s board is not in the mood to hold the AGM anytime soon.

“Yesterday, we again handed a formal request 

to Sebon — the capital market regulator — to fix the AGM date and order the company in writing to hold the AGM within the next 21 days — that is — by May 1, so that the company’s promoters will be forced to hold the annual meeting,” informed Rajoria who is one of the two public directors of the hydropower company’s board from among the minority shareholders.

“We have even demanded Sebon to take action against the non-compliant chairman, managing director, and two directors Laxmi Bahadur Shrestha and Mohan Bahadur Basnet,” he added.

“The deadline will be over in one day but the company has yet to announce its AGM so we will seek clarification from the company and take necessary action,” said spokesperson for Sebon Niraj Giri.

Sebon has the authority to order the company to hold its AGM if the company delays it. Moreover, the regulator can also arrange the company’s AGM itself if the executive board does not comply despite repeated orders and can also audit the company’s balance sheet.

According to regulation, a listed company has to hold its AGM within six months of the end of a fiscal year. But National Hydropower has not held its AGM since the last three years keeping retail investors in the dark about the financial status of the company and the capital market regulator is not taking any action against it, he said, questioning how the regulator could think of boosting investor confidence in such a manner.

“The company has collected money from a large number of investors and it is shying away from its responsibility to disclose the financial status of the company after its financial interests have been fulfilled,” pointed out Rajoria.

Source: THT