Kathmandu. At a time when hydropower companies have dominated the Nepali primary share (IPO) market for a long time, now big industries in the manufacturing sector are preparing to enter. Looking at the list of big companies in the pipeline of the Securities Board of India (SEBON), there are indications that the structure of the IPO market will change in the coming days.
In previous years, most of the IPOs that came in the market were of hydropower companies.
This limited the opportunity for investors to diversify by sector. However, as big companies in the cement, steel, investment and communication sectors are preparing to issue shares, investors will get the opportunity to invest in companies in different sectors.
Companies like Jagdamba Steels, Ambe Steels, Godavari Steels, Saurya Cement, Maruti Cement, Riddhisiddhi Cement and Subhashree Agni Cement are among the companies in the pipeline. Similarly, companies like Dish Media Network (DishHome) and Shivam Holdings are also planning to enter the market. According to analysts, the arrival of companies in the manufacturing sector could help improve the quality of the Nepali stock market.
Investors will find new options as the income, cash flow and business activities of the productive industries are more diversified compared to the hydropower sector. In particular, the cement and steel industries are directly related to the infrastructure development of the country. The listing of such companies on the stock exchanges is expected to strengthen the relationship between the real sector and the capital market.
However, as some companies are preparing to launch IPOs at a high premium price, experts suggest that investors should make investment decisions only after studying the company’s financial condition, profits, assets and future prospects.
According to market experts, the increase in the number of productive companies is a sign of maturity of the Nepali capital market. This is expected to make the hydropower company-centric market multi-dimensional and help to increase market stability in the long run.
