NEPSE has published a new update on the issue of wrong price adjustment during the dividend distribution of Womi Laghubitta Bittiya Sanstha Limited.
The new notice has officially announced that trading of Womi Laghubitta Bittiya Sanstha's shares will now resume.
Previously, trading of Womi Laghubitta Bittiya Sanstha Limited's shares was halted by a notice from NEPSE on March 16, 2020, exercising Article 48 (1) of the Securities Act 2063. It had also nullified all trading that happened on that day and the day before.
Initially, WOMI had proposed 20% bonus shares on current paid-up capital i.e. capital after the adjustment of the right shares and shares of Nagarik Laghubitta (Rs.25.25 Crore). Further events led the company to distribute 25% bonus shares on the pre-adjustment paid-up capital i.e. Rs.10.10 Crore. The company was actually distributing only 10% bonus shares on the current paid-up capital (Rs.25.25 Crore).
However, on the LTP of Rs.1070 per share, a 25% bonus adjustment was repeated to arrive at the price of Rs.856 per share.
According to Article 48 (1) of the Securities Act 2063,
"The stock exchange may, where a body corporate carrying on securities transactions through a stock exchange violates the agreement entered with the stock exchange or where the stock exchange considers that it is necessary to give direction to such a body corporate in order to make securities transactions fair and regular or having regard to the interests of investors, give necessary direction to such a body corporate."
In simpler words, NEPSE has the legal freedom to act on any listed company if its action prevents the market from being fair and regular.
Furthermore, NEPSE has warned in the new notice that necessary actions will be taken if such mistakes are made in the future.