Who is responsible for the IPO issuance of Sebon’s new policy? (Full Text)

लगानी न्यूज

२७ श्रावण २०८३, बुधबार १८:१९August 12, 2026

. KATHMANDU: The Securities Board of Nepal (SEBON) has made public the ‘Primary Capital Market Reform Policy, 2083’ with an objective of making the primary capital market transparent, modern, technology-friendly and in line with international standards. The board made public the policy on August 27.

The policy rejected by the Board has introduced a provision to make the role of the company, the issue manager, the institutional investors and the regulatory body more clear and responsible in the IPO process

The policy, which is aimed at the next 10 to 15 years, aims to develop the primary capital market as a major source of finance for national economic development.TAG_OPEN_div_58

Similarly, the policy aims to make the market competitive, transparent and fully digital in South Asia, reduce the time of IPO approval, increase participation of institutional investors and make the resolution of investors’ grievances more effective.TAG_OPEN_div_56

The new policy has emphasized on making the pricing of IPOs more scientific and market-based. Preference will be given to book building and mixed pricing system along with the fixed pricing system currently prevalent.

The value of the company’s shares will be evaluated on the basis of scientific financial methods such as discounted cash flows, net asset value and comparative multiples of earnings.TAG_OPEN_div_52 This will lay the groundwork for determining the IPO price based on the company’s actual financial position and market potential.

More TAG_OPEN_div_50 stringent regulatory and legal provisions will be put in place to control the activities of artificial demand, collusion and price manipulation in the bookbuilding process.

The policy has been adopted to increase the participation of qualified institutional investors and anchor investors in large public offerings. A clear policy framework will be prepared for this.

Institutional investors such as pension funds, citizen investment trusts, social security funds, insurance companies and mutual investment funds will be encouraged to make long-term investments in the primary market.TAG_OPEN_div_46 This is expected to mobilize long-term capital in the primary market as well as strengthen the institutional investment base in large IPOs.

} Similarly, Sebon has put forward a policy of moving the entire process of IPO from start to finish electronically. Application, electronic customer identification, digital prospectus, document verification, allotment and reporting system will be digitized.

For this, a policy has been adopted to create an integrated primary market digital platform for electronic information exchange among SEBON, Nepal Stock Exchange, CDS & Clearing, Merchant Bankers, ASBA Bank and Office of the Registrar of Companies.TAG_OPEN_div_42

Artificial intelligence, regulatory technology and supervision technology will be used to make regulation and monitoring effective.TAG_OPEN_div_40 A provision has also been put forward to operate a capital market regulatory test site for the testing and use of new technology.

In the new policy, the responsibility of the issue and sales manager i.e. the merchant banker has been made especially stricter.TAG_OPEN_div_38 Minimum paid-up capital, business capacity, cyber risk management, business continuity plan and internal control system of merchant bankers will be strengthened.

Similarly, before issuing IPO to a company, the merchant banker should adequately examine the legal, financial, technical and governance aspects of the company. After such a test, it will be mandatory to submit due diligence certificate.

The policy has also been adopted to make the issue manager legally and financially responsible for verifying the company without adequate examination if it provides false or misleading information.

} Along with this, a provision has also been put forward to implement a system of continuous vocational education and certification for the professional capacity enhancement of the key employees of the merchant bankers.