Nepal’s leading payment system operator Fonepay is preparing to issue an initial public offering (IPO) through the book building method and has entered the final stage of preparations.
Nepal’s leading payment system operator Fonepay is preparing to issue an Initial Public Offering (IPO) through the book building method, with the company currently completing its final preparations for the issuance. In an interview with Ideapreneur Nepal, Chief Executive Officer (CEO) Diwas Sapkota said the company opted for the book building process based on the belief that the market itself should determine the share price. He noted that Fonepay shares are currently being traded in the range of Rs 1,300 to Rs 1,400 per share, making it natural to question whether issuing an IPO solely at a Rs 100 face value would be appropriate.
Sapkota clarified that the decision is neither intended to mislead nor confuse the market, stating that Fonepay has established a strong business standing, which is also reflected in its balance sheet. Emphasizing that Fonepay is a regulated company, he said there is no intention to send incorrect signals to investors and that the book building method is a more suitable mechanism to reflect the company’s actual valuation. However, he acknowledged that the current market conditions and the complexities involved in issuing shares at a premium have made the process challenging. “Book building is not easy in the current scenario,” Sapkota said, adding that even if the company is required to issue the IPO at Rs 100, it believes its valuation will eventually justify that level. He confirmed that the decision to proceed with the IPO through the book building method has already been made and that the process is moving forward, though it involves multiple stakeholders including regulators and market conditions, which could extend the timeline. According to him, the IPO issuance process could take up to one year to complete.
This article was originally published on https://bajarkochirfar.com. Translated with the help of AI and reviewed by our editorial team.
