- By Thursday, 76 companies have applied to the Securities Board for approval to issue IPOs worth NPR 52.48 billion.

- Stating that the Accounts Committee has directed to allow only companies with a net worth of over 90 to issue IPOs, the Board has requested the Commission to grant pre-approval accordingly.

The Nepal Securities Board (SEBON) has requested the Electricity Regulatory Commission not to grant approval for initial public offerings (IPOs) to hydropower companies with a net worth below 90.

There has been strong criticism of the Securities Board, as it has not granted IPO approvals for nearly two years, and intermediaries have reportedly started demanding commissions by claiming they can secure approvals. Amid this situation, a letter from the Board to the Commission, requesting not to grant IPO approval to hydropower companies with a net worth below 90, has surfaced.

“In reference to the directive received by the Securities Board during the meeting of the Public Accounts Committee on December 28, 2023, to allow the issuance of initial public offerings (IPOs) only to companies with an actual net worth of over 90 without revaluation - the Board requests the Commission to consider the said directive while granting pre-approval for IPOs to organized institutions,” the Board stated in its letter to the Commission.

Stating that the directive from the Accounts Committee is still in effect, the Board has not granted IPO approval to many hydropower companies.

Meanwhile, the Securities Board has once again come under controversy after promoters of hydropower companies alleged that commissions were being demanded for IPO approvals. The Board, which has withheld IPO approvals for around 89 companies over the past 22 months, has been accused by hydropower promoters of deploying intermediaries to collect commissions of up to 7 percent, and they have demanded an investigation into the matter. The Commission for the Investigation of Abuse of Authority (CIAA) has also initiated an inquiry. However, the Board and the government have not taken this issue seriously.

By Thursday, 76 companies had applied to the Securities Board for approval to issue IPOs worth NPR 5,248,161,300. Among them, the largest group is hydropower, with 36 companies. These companies have requested approval to issue 174,842,000 shares worth NPR 1,789,150,000. Among the applicants to the Board, there are 5 companies from the hotel and tourism sector, 3 from investment groups, 17 from production and processing, 1 finance company, 3 microfinance companies, and 10 from other sectors.

According to the Independent Power Producers’ Association Nepal (IPPAN), nearly three dozen projects with a capacity of 1009.52 megawatts are awaiting IPO approval. Due to the lack of approval from the Board, hydropower companies have been unable to raise NPR 2.484 billion from the public through IPOs and rights shares. Promoters have had to pay an additional NPR 496 million in interest to banks, and the cost of the projects has increased to NPR 2.187 billion 2.933 million. They claim that due to the failure to issue shares, they have lost potential revenue of NPR 5.552 billion 3.6 million.

Meanwhile, citing the directive of the Public Accounts Committee, the Board has stated that it has halted IPOs for companies with a net worth of less than 90. However, promoters claim that approvals have also been stopped for hydropower projects with a net worth above that threshold.

The Securities Board was without leadership for 11 months after the tenure of then-chairman Ramesh Kumar Hamal ended on December 28, 2025. During this period without a chairman, IPO approvals were completely stalled. About four and a half months after the formation of the new UML-Congress coalition government, Santosh Narayan Shrestha was appointed as the Board chairman. Since his appointment, 10 companies from various sectors have received share issuance approvals. However, there are allegations that the criteria for granting or denying IPO approvals are not transparent.

Source: Kantipur