SEBON plans to remove cap on the price of premium scrip

ShareSansar, October 25:

The Securities Board of Nepal (SEBON) is conducting homework to remove the cap on the price of premium shares in the primary market.

So far the listed companies can issue premium share on the par with its net worth.

SEBON Spokesperson Niraj Giri told ShareSansar that the legal enforcement committee of the regulatory board is exploring the possibility to let the listed companies to fix the price of premium scrip if they can furnish solid figures to justify that.

“We plan to finalize it soon,” he further informed.

The stakeholders in the stock market have been urging the SEBON to amend the Securities Registration and Issue Regulations-2008 to remove the limit on the price of premium share as in the international market.

It is aimed at encouraging the companies from the real sector to enter the stock market.

Once the legal enforcement committee prepares the draft of the amended regulation, the board will approve it and forward it to the Ministry of Finance for endorsement.

Only after the ministry endorses it, the amended regulation will come into effect.

Giri also informed that the SEBON was working to amend the regulation also to reform the provision regarding the registration of the merged companies.

Currently, the board has been registering the merged company in the name of the party which has the highest paid-up capital, thereby canceling the registration of the rest.

The SEBON is also working on a clear-cut provision to address the situation if the shares registered with the board for public shares get published beforehand.