SME platform opened to companies with up to Rs 250 million paid-up capital

Companies with a maximum paid-up capital of up to 250 million rupees will now be eligible to join the Small and Medium-Sized Enterprises (SME) platform.
The Securities Board of Nepal (SEBON) has implemented the "Regulations for Issuance and Trading of Securities by Small and Medium-sized Organized Institutions, 2081," effective today (Thursday). As a result, small and medium-sized enterprises (SMEs) can now participate in the SME platform. SEBON has communicated with the Nepal Stock Exchange (NEPSE) and CDS and Clearing Limited to initiate the necessary procedures for this regulation.
Under the new guidelines, investors will be required to apply for a minimum of 500 lots for SME IPOs. The original draft prepared by SEBON had specified a minimum of 250 lots.
The regulation also stipulates that SMEs can issue IPOs for 30 to 49 percent of their issued capital. Prior to issuing an IPO, 15 percent of the shares must be purchased by institutional investors, and 5 percent must be purchased by merchant bankers. Both types of investors will be subject to a three-year lock-in period for the shares they purchase.
SEBON had submitted the draft to the Ministry of Finance in Chait 2079 (mid-March to mid-April 2023), and the regulation was officially approved by the Cabinet meeting on 9th Poush 2081 (mid-December to mid-January 2023).

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