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Infomerics Credit Rating Nepal (ICRN) has placed 18 companies linked to controversial businessman Deepak Bhatta and other entrepreneurs facing financial crime charges under “Credit Watch with Negative Implications.”

Issuing a public statement, the credit rating agency said these firms have been exposed to heightened risks in the current scenario. The companies include Jagdamba Hospitality Group Limited, Jagdamba Auto Group Private Limited, Jagdamba Motors Private Limited, Jagdamba Steels Limited, Jagdamba Mobiles Private Limited, Jagdamba Hire Purchase Limited, and Jagdamba Flour and Agro Private Limited.

Other firms placed under watch are Shaurya Cement Industries Limited, Riddhi Cement Industries Limited, Himalayan Life Insurance Limited, Himalayan Investment Banker Limited, Hulas Finserv Hire Purchase Limited, Ganapati Vanaspati Private Limited, Litmus Industries Limited, Teletalk Private Limited, Tele Direct Private Limited, Ramjanaki Hydropower Private Limited, and Vedanshee Infrastructure Limited.

According to ICRN, the decision was taken after certain promoters and directors of these entities were identified in ongoing financial investigations. The rating action reflects reputational risks for the promoters and directors, with possible spillover effects on the associated companies.

A “Rating Watch” signals a heightened probability of a rating change and indicates the likely direction of such a change.

“While credit rating remains on negative watch, ICRN utilizes such period by monitoring the ongoing developments and gathering additional information so as to assess whether and to what extent the existing credit rating may have to be revised. It shall not indicate a downward change in credit rating,” the agency’s statement noted.

The move comes amid Nepal’s largest-ever money laundering and financial misappropriation case, involving over Rs 115 billion. A total of 39 individuals and several companies are currently facing trial. Beyond recovery of disputed funds, prosecutors have sought fines of up to double the claimed amounts under the Money Laundering Prevention Act, 2008.

At the centre of the case is businessman Deepak Bhatta, against whom the state has sought recovery of Rs 26.63 billion - the highest amount claimed against any individual. He remains in police custody.

Market analysts say the scrutiny of companies affiliated with large business groups has compelled banks, financial institutions, investors, and lenders to reassess the risk profiles of such firms. The development has also intensified debate on corporate governance and transparency in Nepal’s private sector.

By Rajesh Khanal