NEF Current NAV : 9.60 as on 2022-11-25
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NBF3 Current NAV : 8.31 as on 2022-11-25

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What is an IPO?

Initial Public Offering (IPO) is considered one of the most effective ways to raise funds for companies worldwide. Hence, a lot of companies use IPOs to raise funds worldwide. With Nepalese companies also maturing and with clear policies on the same, more and more companies are issuing IPOs to raise funds for their expansion / growth. 

This gives companies access to funds from the public and for the general investors provides a really good opportunity to invest in a profitable company. Let’s learn more about the IPO.

What is an IPO?

IPO is an instrument through which a company offers its shares (stocks / ownership) of its company to the public by allocating new shares. In Nepal, companies from different industries (for eg. banking, trading, manufacturing, hydropower, etc.) have issued IPOs in the past.

We have seen a rising trend of more and more companies issuing IPOs to raise funds. Because, IPOs issuance license is only given to companies who have either already demonstrated profitability or have a safe investment outlook, investing through IPO is often considered one of the safest investment tools. 

Who applies for an IPO?

If you are new to investing in stock markets, you must have been advised by several experts to start your journey by investing in an IPO as well. Because of this, more and more people are applying for IPO with each new issue. 

One of the reasons why so many investors apply in IPO is that apart from being a safe investment, the returns are also really good in an IPO investment usually. Not only that, IPO is also one of the easiest investment tools to use in the current investment Market in Nepal. 

Therefore, everyone who understands some basics of stock market investment usually do apply in an IPO.Currently, there are more than 50 lakhs demat accounts (or investors who have invested or want to invest in stock markets). Out of these, currently around 30 lakhs investors usually apply for IPO. 

Because of this high volume, successful IPO allotments are considered lucky  as well. Are you feeling lucky as well?

How to apply for an IPO?

But hang on, in order for you to apply, you need to get some ground works done. Here is what you need to do:

  1. Open a Demat Account in a merchant banker of your choice. Nabil Investment provides excellent Demat Account services to its customers. 
  2. Apply for C-ASBA with the bank where you have a savings / current account. 
  3. Once you have the CRN number (you will get this once you have C-ASBA setup), you can apply for IPO of companies who have issued IPO from Meroshare (meroshare.cdsc.com.np)

To learn about opening a Demat account online with Nabil Investment, read our blog on the same. 

Until next time, Happy Investing (Happy IPOing) 🙂