Reliance Life to go public

 Reliance Life Insurance is issuing 6.3 million units of ordinary shares to the public from August 20 at Rs 100 per unit. 

The life insurance company is issuing 30 per cent of its issued capital of Rs 630 million worth of shares post which the paid-up capital of the company will be Rs 2.10 Billion. Sanima Capital is the issue manager of the shares.

Out of 6.3 million units of shares to be offered to masses, some 315,000 shares have been set aside for the employees of the company, some 315,000 shares have been set aside for mutual funds approved by Securities Board of Nepal (Sebon) and the remaining 5.67 million shares will be offered to the public.

According to chief executive officer of Reliance Life Insurance Prabin Raman Parajuli, the company is the first to issue Initial Public Offering (IPO) to the public among the last lot of 10 new life insurance companies licensed by Insurance Board (Beema Samiti). “The company has been launching innovative plans at competitive prices as demanded by the market with core focus on quality servicing and digitization which further ensures enhanced service delivery,” he said.

Reliance Life Insurance -- commenced its operations from November 17, 2018 – is promoted by Siddhartha Bank Ltd and prominent business houses. The company has been rendering professional services to the public through its 100 point of sales.

Stock trading a mouse click away

The day is not far then an investor here or abroad and brokers could place an order to sell or buy stocks through Internet.
“We are trying hard to make it possible that brokers can work from their respective offices,” Bimal Prasad Wagle, chairman of the Nepal Stock Exchange (Nepse) said. He added that the system, which is now operating in Local Area Network (LAN) only will be soon upgraded to Wide Area Network (WAN). “And the days of online trading is also not far,” Wagle said.
However, experts showed serious concern, over rise in the shares prices in recent days that is not supported by the economic growth, at a formal inaugural function of automated trading — after the successful test — of the Nepse, in the valley today.After the automation, stock analysts have predicted price correction but contrary to that the heated stock market is not showing any signs of cool down.
“Too much money is chasing too few shares creating an artificial rise in the prices,” finance minister Dr Ram Sharan Mahat said adding that there has been no new issuance to meet investors’ appetite at present.
“Present irrational exuberance is also due to short supply of shares,” Dr Posh Raj Pandey, member of the National Planning Commission (NPC), the government think-tank, said adding that the new tools like mutual fund could help stabilise the market.
“The present growth of Nepse index — and that only of the banking index (Bankex) — do not reflect real economic growth,” said Rewat Bahadur Karki, CEO and MD of the Nepse adding that the development of a barometer — of present banking sector dominated market — is a real challenge.
“One of the reasons of Bankex being bullish is due to the transparent and international standard accounting system of the financial institutes, which indicates that the transparent and international standard accounting system will help boost the real sector also,” Karki said adding that the market capitalisation has reached to around Rs 200 billion and the number investors has also increased to 800,000 at present.
“But the number of brokers is not sufficient and we are committed to increase the number of brokers in near future,” Deepak Raj Kafle, chairman of the Securities Exchange Board (SEBO) said.
Nepse is planning to adopt some other practical measures like Central Depository System (CDS) and Real Time Information, which will ultimately help it to grow as a vibrant sector.
Krishna Bahadur Manandhar, acting governor of Nepal Rastra Bank on the occasion, praised Nepse’s initiative and stressed on competitiveness.
Steve Ujarosy, the technical consultant for the automation, said that automated trading system would expand horizon and secure the future of capital market in Nepal.
On the occasion, Umesh Regmi, a broker stressed on making share market competitive and autonomous and Jeevan Basnet, an investor gave some suggestions for the improvement of Nepse.
Comdaq Ltd — that has supplied the system to replace the open-out-cry system — issuing a press release has congratulated the Nepse for entering into the new age of technology.The stock market automation was supported by Asian Development Bank (ADB) under the CFG project.