KATHMANDU: Nepal Securities Board (SEBON) Chair Dr Gopal Prasad Bhatta has said the regulator will adopt a zero-tolerance policy against illegal activities related to pre-IPO investments and other irregularities in the capital market.
Speaking at a meeting of the House of Representatives’ Finance Committee at Singha Durbar on Wednesday, Bhatta said the board would focus on preventing future misconduct rather than dwelling on past incidents.
He pledged that IPO approvals and all other regulatory processes would be carried out through a transparent system.
Bhatta said he had recently held discussions with investors to boost their confidence, claiming the meetings had helped improve investor sentiment.
He also announced that from the next fiscal year, SEBON would introduce closer supervision across inspections, regulatory oversight, standards, reporting systems, infrastructure, and information technology.
According to Bhatta, the board is also preparing policies to curb the spread of misleading rumours in the stock market.
During the meeting, Finance Committee members urged SEBON to take stronger action against market manipulation and protect ordinary investors.
Committee member Lima Adhikari questioned the process of determining premium prices during pre-IPO offerings and sought clarification on how the funds raised through such schemes are utilised.
She also expressed concern over companies reporting unusually high profits before launching IPOs, only to fall into losses within a few months of listing, and urged the board to closely monitor such practices.
Committee member Prof. Dr Pushpa Raj Kandel said the trend of collecting money from the public in the name of establishing companies and later disappearing with investors’ funds has hindered the development of Nepal’s productive sectors.
He noted that, apart from some investment in hydropower, Nepal has seen insufficient long-term investment in productive industries and stressed the need to improve institutional governance in both the stock market and the broader business sector.
Other committee members also called for a stronger role for SEBON in safeguarding retail investors and ensuring consistency between companies’ projected and actual financial statements.
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