The latest company who’s right shares was approved by SEBON is Radhi Bidyut Company. You can find the list of all upcoming right share in Nepal in below. You can also read about what exactly are right shares, what is the benefit of right share, how to be eligible to apply for upcoming right shares in Nepal, and learn more about right shares.
Let’s jump into the guide!
What are Right Shares in Nepal?
Once the company has issues IPO, the company can later offer additional shares to raise more capital, however this time, the general public doesn’t get the same privilege as existing shareholders. Initially during IPO, everyone can apply for the shares offered, but during a right share issue, the initial priority is the existing shareholders and only they can apply for the right shares. But, if some shares remain unsold after a specific period, then those shares are auctioned off in the market, where the highest bidder can buy the shares. Let’s look at some upcoming right shares in Nepal.
List of Upcoming Right Share in Nepal
In the list below, you can see the upcoming right shares in Nepal. There are many public hydropower companies trading in NEPSE, and this list is dominated by hydropower companies as well.
| Company | Sector | Ratio | Date of Approval |
|---|---|---|---|
| Ngadi Group Power Ltd [NGPL] | Hydropower | 1:1.5 | 2079/03/09 |
| Barun Hydropower Company [BARUN] | Hydropower | 1:1 | 2079/03/15 |
| Radhi Bidyut Company [RBCL] | Hydropower | 1:1.4752 | 2079/04/09 |
| Life Insurance Corporation Nepal Limited (LICN) | Life Insurance | 1: 0.8845168 | 2079/09/22 |
| Himal Dolakha Hydropower Company Limited (HDHPC) | Hydropower | 1:0.75 | 2079/09/22 |
| Api Power Company Limited (API) | Hydropower | 1:0.40 | 2079/10/15 |
| Synergy Power Development Company (SPDL) | Hydropower | 2: 1 | 2079/10/16 |
Benefits of Buying Right Share in Nepal?
Many people are excited about right shares. If a company is good, the news of right share can even increase the price of the share in the market. The biggest advantage of right share is that you can purchase them at a very low price compared to the price at which the stock is being traded. For example, the current trading price(3rd August 2022) of HDL is 3910 NPR. If they are to issue right shares, then you can purchase the shares of HDL at just rupees 100!!!
It’s a great opportunity for existing shareholders to increase their shares of the company at a minimal price. Right issue also helps the company to raise more capital so they can fund their future plans. Capital raised from right share can be used for growth plans, pay back debt, or acquire an upcoming competitor.
Right share can also mean that the company is short on cash, so it’s vital that you understand how the company’s cash position looks like and where the company is likely to use the capital raised by right share.
Who can Apply For Right Shares?
To apply for right share of a company, you need to be the existing shareholder of the company. For being eligible as the shareholder of a company, you need to have shares of that company at least 1 day before the book closure day.
For example, RSDC laghubitta bittiya sanstha had issued right shares in the ratio of (5:3) from 2075/03/17 to 2075/04/20. The book closure date for the right issue was set for Jesth 21, 2075. To be eligible as the shareholder, and to be able to purchase right shares during issue period, you would have to retain RDSC shares by at least one trading day ahead of the book closure date i.e. until Jesth 20, 2075. Hence, if you have shares of RSDC in your DEMAT account before Jestha 21, then you are eligible to purchase it’s right share.
How To Apply For Right Shares?
To apply for right shares, you need to hold the shares before the book closure date as discussed above. If you are an eligible shareholder to apply for right share of the company. You can apply for the right share using Meroshare. You can check the full guide on how to apply for right share here: Apply for Right Share in Nepal.
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How Many Right Shares can You Apply for?
When a company issues right shares, it also releases a ratio in which the right shares are issued. For example, in the case of RSDC above, it had issued right shares in the ratio of 5:3, that mean you can purchase 5 shares for every 3 shares that you hold. So, if you have 30 shares of RSDC, that mean you can apply for 50 shares of RSDC. To make it easier to calculate, you just write the ratio in fraction form and them multiply it with your existing number of shares you’re holding. 30*(5/3) = 50 shares.
In Meroshare, the number of shares you will be applying is auto filled so you don’t have to calculate this on your own.
So, we hope we’re answered your queries about the upcoming right share in Nepal, and now you understand the details regarding the right share issue in Nepal and how it effects the stock market.
If you have any questions or queries, feel free to ask in the comments below.
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