What is Opening Price Range of Bhagawati Hydropower Development?
The opening price range of Bhagawati Hydropower Development Company is Rs. 120.41 to Rs. 361.23. This opening range will be determined by the NEPSE based on the audited financial ratio for the last audited year. The net worth per share will be taken as reference while determining the opening price range. As per the offer letter, the net worth per share of the company stands at Rs. 120.41, earning per share is Rs. 19.23 and reserve and surplus 87572.749 (in millions).
About IPO Issue
Bhagawati Hydropower Company had issued 712,220 unit IPO shares for Rs. 116 per share (Rs 100 face value + Rs 16 premium price) to the general public from 5th to 8th Bhadra, 2080.
Out of the total issue 858,097 units; 10% i.e. 85,810 units have already been issued and allotted to Nepalese citizens working abroad, 5% i.e. 42,905 units have been set aside for the mutual funds while 2% or 17,162 units have been set aside for the employees of the company. The remaining 712,220 units are for the general public.
The issue received applications from 13,06,677 valid applicants who had applied for a total of 1,42,40,550 units oversubscribing the issue by more than 20 times. Total of 71,220 applicants were allotted 10 units each via lottery method while remaining 12,35,457 applicants were returned with empty hands.
How is the opening price range determined?
Nepal stock exchange (NEPSE) determines a new company’s opening price range based on the company’s book value (net worth per share). The net worth is taken from the company’s audited financial report issued during the IPO issuance. For example, if the book value of the company’s latest audited report is 100 then the opening price range will be 100 – 300. The minimum price should be the same as the book value.
What is a special pre-open session?
A special pre-open session is a trading time for newly listed stock. When a new company gets listed in NEPSE for the first time, its share is traded in the special pre-open session for the first time. After trading in the pre-open session, its share starts to change in the continuous session which is 11 AM – 3 PM.
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