Location via proxy:   [ UP ]  
[Report a bug]   [Manage cookies]                
Scribd Logo
Upload

Welcome to Scribd!

  • 31 views

    Book Building Process in Nepalese Capital Market-Synopsis: Research

    Uploaded by

    Raushan Kumar
    The document summarizes the book building process for issuing initial public offerings (IPOs) in Nepal's capital market. Under book building, a company determines a price range and collects bids from institutional investors to set a final cut-off price. To issue an IPO through book building, a company must meet minimum criteria like being profitable for 3 years. The process involves determining a price range, collecting bids within that range from institutional investors to set the cut-off price, then issuing shares to the general public and institutional investors.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd

    Book Building Process in Nepalese Capital Market-Synopsis: Research

    Uploaded by

    Raushan Kumar
    31 views4 pages
    The document summarizes the book building process for issuing initial public offerings (IPOs) in Nepal's capital market. Under book building, a company determines a price range and collects bids from institutional investors to set a final cut-off price. To issue an IPO through book building, a company must meet minimum criteria like being profitable for 3 years. The process involves determining a price range, collecting bids within that range from institutional investors to set the cut-off price, then issuing shares to the general public and institutional investors.

    Original Title

    Book_Building_Process

    Copyright

    © © All Rights Reserved

    Available Formats

    PDF, TXT or read online from Scribd

    Did you find this document useful?

    Is this content inappropriate?

    The document summarizes the book building process for issuing initial public offerings (IPOs) in Nepal's capital market. Under book building, a company determines a price range and collects bids from institutional investors to set a final cut-off price. To issue an IPO through book building, a company must meet minimum criteria like being profitable for 3 years. The process involves determining a price range, collecting bids within that range from institutional investors to set the cut-off price, then issuing shares to the general public and institutional investors.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    31 views4 pages

    Book Building Process in Nepalese Capital Market-Synopsis: Research

    Uploaded by

    Raushan Kumar
    The document summarizes the book building process for issuing initial public offerings (IPOs) in Nepal's capital market. Under book building, a company determines a price range and collects bids from institutional investors to set a final cut-off price. To issue an IPO through book building, a company must meet minimum criteria like being profitable for 3 years. The process involves determining a price range, collecting bids within that range from institutional investors to set the cut-off price, then issuing shares to the general public and institutional investors.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    of 4

    Book Building Process in Nepalese Capital Market- Synopsis

    TREY
    research
    1
    Issuing IPO through Book Building
    What is Book Building ?
    Book building is a system for issuing an IPO at a pre-determined price. The process of determination of the price is also known as price
    discovery, which is usually done by generating investor’s demand and valuation of the company.

    Book Building in Nepal


    Securities Exchange Board of Nepal has implemented Book Building Bylaws 2077 that would facilitate the process of floating ordinary shares
    for both institutional and general investors.

    Minimum Criteria for a company to issue IPO through Book Building system:

    • Approval from company’s AGM to issue IPO through the book building
    system
    • Company should have operated at a profit for the last 3 years
    • Net worth per share should be maintained at 150% of per share paid up
    capital.
    • Average or above average rating from rating agency.

    TREY
    research
    2
    Process of Issuing IPO through Book Building
    Determination of a price range: Issue to General
    Determination of Cut-off price: Public:
    The concerned company shall
    The concerned company shall The general public
    initially determine the average
    ask at least 10 interested will be able to apply
    value of the IPO based on the
    institutional investor to submit for minimum 50 units
    company’s valuation and the
    Obtain approval from company’s their bids. While collecting the at a discount of 10%
    demand of the IPO being issued.
    AGM for issuance of IPO through bids from institutional investors of the cut-off price.
    Also, the company shall prepare
    book building system. bids for 100% of the allocated
    an initial prospectus and conduct
    units eligible for institutional
    a roadshow involving the
    investors shall be collected.
    interested institutional investors
    Based on the bids received, the
    Once the average value is
    cut off price shall be determined.
    determined, the concerned
    Cut off price shall be the price at
    company shall call out to
    which the maximum number of
    institutional investors to apply
    applicants have submitted the
    for the shares within the specific
    bids within the price range.
    price band.

    In case the concerned The concerned


    The bidding by the
    company is not able to collect company can issue
    institutional investor is
    bids for 100% of the allocated maximum 40% of
    done within the price range
    units or from at least 10 shares to the
    i.e. 20% below (i.e. Floor
    institutional institution, then institutional investors
    price) or above (i.e. cap
    the company shall revise the and 60% to the
    price) of the average price
    price range and proceed for general public
    determined as above.
    collecting the bids as earlier. TREY
    research
    3
    For Further Consultation, Please Contact:

    S.A.R. Associates,
    Chartered Accountants

    64 Bishal Basti “Ka”, Bishal Nagar,


    Kathmandu, Nepal Disclaimer: The information contained in
    this document is compiled by S.A.R. Associates
    solely for the purpose of its clients and staffs.
    Tel: +977 (1) 442 0807/ 08/ 10
    SARA will not be responsible for any decision
    Fax: +977 (1) 444 0528
    taken on the basis of matters contained herein.

    Website: www.sar.com.np

    Email: info@sar.com.np

    TREY
    research

    You might also like