Reliance Spinning Mills Receives Over 17 Times More Applications Than Shares Allocated For Nepalis Abroad

Reliance Spinning Mills has received more than 17 times the number of applications than the shares reserved for Nepalis working abroad. According to Global IME Capital Limited, the issue manager, a total of 36,082 applicants sought 2,001,470 shares by the final day of the offering. The company said this is the highest number of applications ever received from Nepalis abroad for a public offering.

The applications amount to more than Rs 1.64 billion, the issue manager said. The company issued its shares under the book-building method, pricing them at Rs 820.80 per share for the public. Before this, the company had already issued and allotted shares to qualified institutional investors.

Of the 1,155,960 shares allocated for the general public, 10 percent—or 115,596 shares—were set aside for Nepalis working overseas. The company opened the offering on December 8, and because applications exceeded demand on the first day, the closing date was set for December 11.

According to the issue manager, a total of 36,082 applications were received for 2,001,470 shares, against an allotment of only 115,596 shares reserved for migrant workers. The offering collected Rs 1.64 billion.

The company had allotted shares to qualified institutional investors at Rs 912 per share, while the general public received a 10 percent discounted rate of Rs 820.80 per share. The issuance process had been halted for 17 months due to a directive from the Public Accounts Committee under the House of Representatives.

Reliance Spinning Mills expects that the strong response from Nepalis abroad will help create positive sentiment among general investors. After allotting shares to Nepalis working overseas, the company plans to issue shares to the general public.

The company has received approval to issue 1,926,600 shares—equivalent to 10.14 percent of its paid-up capital of Rs 1.90 billion. Of the total issuance, 40 percent has been allocated to qualified institutional investors and 60 percent to the general public.