IPO issue of Nepal Re-Insurance Company added to SEBON pipeline; 16 Million units to be issued at par

Securities Exchange Board of Nepal (SEBON) has added proposed IPO issue of Nepal Re-Insurance Company Limited under preliminary review in the latest list of IPO issues in pipeline published.

The company is proposing to come out with an IPO of 16,000,000 equity shares with a face value NPR 100 each, at par for the general public. The amount of the issue is Rs.1.60 Arba.

RBB Merchant Banking Limited has been appointed as the issue manager for the proposed IPO issuance.

ICRA Nepal Limited has assigned a [ICRANP] IPO Grade 2 to the Rs.1.60 Arba Initial Public Offer of Nepal Re-Insurance Company Limited. Instruments with this grading are considered to have above-average fundamentals.

Nepal Reinsurance Company Limited has reported a total profit of Rs.1.17 Arba for the Q4 of FY 2075/76. The profit from Life insurance amounts to Rs.19.11 Crore while the net profit from Non-Life Insurance amounts to Rs.98.68 Crore.

Nepal Re-Insurance Company Ltd. (Nepal Re) is the successor of the insurance pool that was set up in 2003 with the aim to cover the losses arising from situations like riot, sabotage, or terrorism and malicious damage (RSTMD), during the insurgency in Nepal. Nepal Re was incorporated on November 7, 2014, under the Companies Act, 2006 as per the decision of the Council of Ministers to convert the pool to that of a reinsurance company. The company came into operation from December 2014. This is the first and only Nepalese reinsurance company.

The paid-up capital and the net worth of Nepal Re as of mid-Jan 2019 stood at NPR 8,400 million and ~NPR 11,686 million respectively. At present, the entire equity shares of Nepal Re are held by promoter shareholders. The shareholding is divided among the Government of Nepal (GoN) (~44%), 17 non-life insurance companies (~38%) and eight life insurance companies (~8%) and other public institutions (~10%).