Trading of Vijaya Laghubitta (VLBS) Suspended as the Company Declares Dividend By Violating NEPSE Guidelines

According to the official notice of the Nepal Stock Exchange (NEPSE), the transaction of Vijaya Laghubitta Bittiya Sanstha Limited (VLBS) has been stopped as the company declared dividends to be issued to the shareholders without prior approval of NEPSE.

The letter regarding the dividend declaration of the Fiscal year 2078/79 by VLBS was received by Nepal Stock Exchange at 6:35 PM after business hours on Magh 25. However, Vijaya Laghubitta conducted a meeting to propose dividends to the shareholders on Magh 10 itself.

According to the provision in Regulation 22(1)(d) of the Securities Listing Regulations, 2075, if notices, information and decisions affecting securities prices are created, such notices, information and decisions must be submitted to NEPSE on the same day or the next day before the opening of business. Here, VLBS was supposed to provide notice regarding the dividend declaration to NEPSE on Magh 10 or Magh 11 before business hours.

Since VLBS contradicted the rules outlaid by NEPSE, the trading of the securities of the said company has been suspended. Likewise, within 3 (three) working days, the company is required to submit an explanation in this regard.

The meeting of the board of directors of VLBS held on Magh 10 decided to distribute the dividend on the paid-up capital of Rs. 32 Crores. 20% bonus shares worth Rs. 6.40 crores and 1.0526% cash dividend (for tax purposes) worth slightly over Rs. 33.68 lakhs have been proposed.