SEBON introduced the provision by amending the existing Securities Registration and Issue Regulations. The new provision came into effect from Monday. [break]
Shurbir Poudel, chairman of SEBON, said the provision would help real estate sector gets more investment.
As per the earlier provision, companies had to complete at least a year of operation before raising their capital base through public issues. It also demanded banks and financial institutions to complete a year of operation before going public.
Now onwards, companies that have already initiated procurement of land and equipment, construction of factory and buildings and arranged investment source can issue public shares. Hydropower companies can float shares after completing power purchase agreement and awarding tender for development of infrastructures.
The new regulation makes it mandatory for promoters of the companies to pay all shares amount owned by them before going for initial public offering. Under the new amendment, companies can sell off their 15 to 45 percent of shares to the public.
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