A Short Guide on How to Apply for IPO Quota by Individuals Working Overseas

For Nepalese working overseas, a quota mechanism has been put in place in the Initial Public Offering (IPO). Companies have begun setting aside quotas for employees who are working abroad. But many people are perplexed even if they desire to invest in shares because the application procedure is unclear.

Some people with stock market knowledge were operating from abroad without using any of their quotas. They also want to know how to fill the quota. Securities Board (SEBON) lowered the proportion of regular individuals in the IPO and implemented a 10% quota for those working overseas.

The abroad employed workers and their families have begun to protest, however, because the pertinent agencies did not make clear the application process. Hence we are clarifying a few things.

Only Nepalese who have secured work authorization from the Ministry of Labour have been given access to this quota in ordinary shares. A work permit from the Nepali government for foreign employment is required, according to SEBON, for anyone who wants to apply for quota shares. Additionally, the applicant must open a remittance account in their own name at the bank.

Members who are still in the nation but have been given permission to work abroad can go to the bank and complete the application for a remittance account. The applicant must be accompanied by a work permit, a passport bearing a visa stamp, and an airline ticket.

Likewise, one might open a remittance account if they have relocated abroad for a job. In Nepali Bank, they can also convert their standard savings account into a remittance account. For this, banks offer the option of online account registration. By visiting the website of the relevant bank and using the online account registration option, an account can be started quickly.

Through official means, funds can be transferred immediately to the remittance account. The passport along with the labor permit and visa stamp must be scanned and provided in PDF format for this as well. Some banks additionally inquire about the income level of the employer that these clients have chosen.

Only individuals who send remittances upto NRs 50 thousand and more from official sources are covered by this arrangement, which is also mentioned in the budget for the current fiscal year. Opening a remittance account also entitles the holder to a 1% increase in interest rates over the standard term. Current interest rates on remittance accounts offered by commercial banks are 13.13 percent.

The concerned person must file the application for a Demat account using the remittance account as the foundation. By opening the account holder's Demat account, a CRN (C-ASBA Registration) number can be obtained.

The bank will also require individuals to complete an application form for Mero Share that will give the candidate a Mero Share login username and password. Mero Share is an online resource created by CDSC (Central Depository System and Clearing Limited). This gives information about share transactions in their Demat account. It is also accessible as a mobile app.

The concerned applicant can visit the website or mobile app and submit an application for the IPO of the reserved quota after receiving the username and password information for Mero share. As per reports, more than 150 additional remittance accounts have so far been added to the system.

Currently, 4 companies are issuing IPO for employees working abroad. They are:

Kalinchowk Darshan Limited- IPO to the project-affected locals and Nepalese citizens working abroad. Opened from Mangsir 14, which will conclude on Mangsir 28, 2079.

Supermai Hydropower Limited- Issue IPO to the project-affected locals of the Illam District and Nepalese citizens working abroad. The issue will open on 21st Mangsir, and close on 6th Poush, 2079.

Super Madi Hydropower Limited- IPO issue for the locals of Kaski District and Pokhara Metropolitan and Nepalese citizens working abroad will also open on 20th Mangsir, and close on 5th Poush, 2079.

Maya Khola Hydropower Company Limited- This IPO issue for the locals of Sankhuwasabha District and Nepalese citizens working abroad will open on 23rd Mangsir and close on 8th Poush, 2079.