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SEBON Sets FPO Pricing Standard

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SEBON Sets FPO Pricing Standard
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August 14: Securities Board of Nepal (SEBON) has issued a directive regarding bases and procedures of quoting the price of Further Public Offering (FPO). The companies that have already raised capital through public and have been listed in Nepal Stock Exchange can again raise capital from public through FPO. Earlier, SEBON has formed a committee in order to make the FPO pricing more manageable, transparent, fair and uniformity as well as to recommend base and procedure of FPO pricing.  Based on a report submitted by the committee, SEBON has issued the directive devising a standard for FPO share pricing.

According to the directive, the listed companies must follow four procedures including capitalised earnings, net worth per share, average market price of 180 days and discounted cash flow (present value of cash flow to be received in future) while determining value of shares to be issued through FPO. Moreover, the idle FPO price would be the average of the outcomes calculated through these methods. The directive mentioned that the listed companies must submit application for FPO at SEBON within four months of getting an approval from the general meeting. 

 

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