November 26, 2023 | Investopaper
Sarbottam Cement is currently issuing primary shares (IPO) through the book building method. The company is auctioning 24,00,000 shares to the eligible institutional investors from Mangsir 6, 2080 BS. The auction price will range from Rs. 401 to Rs. 601.5. The issue will remain open until Mangsir 10, 2080 BS.
For the purpose of Public Offering, Securities Board Of Nepal (SEBON) has given permission to the company on Ashwin 29, 2080 BS. The company had submitted the application to the board on Ashad 28, 2079 BS. Only after the approval from the regulatory body, the company can sell the shares to the public.
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The company plans to sell 60 lakh shares in the IPO. This is the first event of public offering through the book-building process in the Nepalese capital market. Out of 60 lakh shares, Sarbottam Cement will float 24 lakh shares to the institutional investors, 8 lakh shares to the locals of the project affected areas, and the remaining 28 lakh shares to the employees and the general public.
At current, Sarbottam Cement has Rs 3.40 Arba as the paid-up capital. By issuing the primary shares, Sarbottam Cement aims to increase its paid-up capital to Rs 4 Arba. The company is preparing to issue 15 percent shares to the public.
The face value of each share is Rs 100. However, the approved IPO price determined by the book building process is Rs. 401 per share.
The company has appointed Global IME Capital as an issue manager. Likewise, Prabhu Capital and NIBL Ace Capital have been appointed as co-issue manager.
The book building process is considered to be the most scientific in international practice. It encourages highly profitable companies to enter the stock market by issuing shares at fair value to their net worth.