I.P.O. share quota of five percent reserved for mutual funds is under scrutiny, with a Member of Parliament questioning its actual benefits for small investors.
Rastriya Swatantra Party (RSP) Member of Parliament Lima Adhikari raised a concern regarding the five percent I.P.O. share quota set aside for mutual funds. She questioned if this arrangement has truly provide benefit to small investors.
During a meeting of the House of Representatives’ Finance Committee, where the functions and actions of the Nepal Securities Board (SEBON) were being discussed, MP Adhikari asked for a public assessment. She wanted to know how much this specific provision contributed to increasing market depth and protecting the interests of general investors.
Adhikari also commented that mutual funds are showing a tendency to ‘flip’ shares. She pointed out that instead of contributing to market development, mutual funds are making a quick profit by selling shares obtained from I.P.O.s in a very short period. She then asked what arrangements are in place to stop this, such as a lock-in period or other regulations, stating that the board’s view on this issue must be clear.
AI Disclaimer: This article was originally published on https://bajarkochirfar.com. It has been translated with the help of AI. For the best understanding and accurate facts, we recommend reading the original Nepali version.
