Tuesday, June 16, 2009

Vibor Bikas Bank’s Primary Issue Oversubscribed

The primary issue of Vibor Bikas Bank is oversubscribed fourfold to over Rs 1.10 billion. The development bank floated 26,52,000-unit primary shares at a face value of Rs 100 per on June 10. According to NMB Bank — sales and issue manager of Vibor Bikas Bank — the primary issue closed today after the banking hours as the IPO was oversubscribed.

According to the new IPO regulation, the IPO can be closed in four days if it is oversubscribed. Otherwise, it has to be open for a month. “On the first three days, 32,684 applications worth Rs 558.2 million were received,” said Niraj Giri, director at the Securities Board of Nepal (Sebon) — the regulatory authority of the capital market. On the last day today, it expects to receive 20,000 applications worth around Rs 500 million, making it a total of over Rs 1 billion — around four times than what the bank has asked for. The bank’s promoters collectively hold 61 per cent of the total capital of Rs 680 million.

However, no individual promoter holds more than three per cent share. The average shareholding is 0.45 per cent and standard deviation 0.46 percent. The remaining 39 per cent of the shares have been floated among the general public. Vibor Bikas Bank — a national level Class B financial institution licensed by Nepal Rastra Bank — commenced operations from October 4, 2007. It is promoted by 135 professionals with diverse backgrounds.

Meanwhile, Chilime Hy- dropower that was supposed to float 23,04,000-unit shares from June 15 has been told by the Supreme Court to halt it. Chilime had added a premium of Rs 223.70 to the face value of Rs 100 per unit, making it a total of Rs 323.70 per unit share. Arun Valley Hydropower is also floating 5,15,000-unit primary shares from June 23. The company has added a premium of Rs 84 to the face value of Rs 100, making it Rs 184 per unit share.

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