Reliance Spinning Mills IPO Details

Reliance Spinning Mills IPO is all set to be issued to general public. Reliance Spinning Mills Ltd. (RSM) established in 1994 AD, is the largest spinning mills in Nepal. After issuing its shares to Qualified Institutional Investors (QII) in the first phase under the Book Building Method, it is now issuing the shares to general public (IPO).

General Details of Reliance Spinning Mills IPO:

Units Issued: 11,55,960

Price: Rs. 820.8 per share

Min. Quantity: 50 units

Min. Investment: Rs 41,040

Opening Date: Not Fixed

Closing Date: Not Fixed

Issue Manager: Global Ime Capital

Also check out other investment opportunities: Upcoming IPOs in Nepal with date!

Detail Overview of Reliance Spinning Mills

Reliance Spinning Mills recently launched its Initial Public Offering, offering shares to eligible institutional investors in Nepal. Here’s a breakdown of the IPO details and the allocation process.

Reliance Spinning Mills: Overview and Details

Reliance Spinning Mills, one of Nepal’s leading textile companies, has launched its Initial Public Offering, providing an exciting opportunity for traders and investors on the Nepal Stock Exchange (NEPSE) to participate in its growth journey. Let’s delve deeper into the specifics of the IPO and the allocation process:

IPO Allocation Process

The IPO was conducted using a book-building method from January 10th to January 14th, attracting active participation from 64 eligible institutional investors.

During this phase:

• Highest Bids: Notably, 18 companies submitted bids at the top price of Rs. 912 per share.
• Allocation Criteria: Investors applying at Rs. 912 per share received shares in proportion to their application. However, applicants at Rs. 912 received only 65.72% of their requested shares due to oversubscription.

Qualified Institutional Investors (QIIs) Allocation

Reliance Spinning Mills allocated 7,70,640 unit shares to Qualified Institutional Investors (QIIs) within a price range of Rs. 608 to Rs. 912 per share, reflecting robust interest from institutional buyers.

Public Offering Details

The price for Reliance Spinning Mills IPO is Rs. 820.8 per share. Since the cut-off price for qualified institutional investors was Rs. 912, the general public is getting the shares at 10% discount on the cut-off rate.Add image

How much money is needed for Reliance Spinning Mills IPO?

Rs 41,040 is needed to participate in the Reliance Spinning IPO. Investors on the NEPSE must invest a minimum amount of Rs 41,040 since the minimum applicable unit is 50.

Who is the owner of Reliance Spinning Mills?

Pawan Kumar Golyan is the founder shareholder of Reliance Spinning Mills Limited.

Why is Reliance Spinning Mills IPO expensive?

There was a range set to apply by QII but since they applied at high valuations i.e. 912, we general public are getting it at 10% discount i.e. re. 820.8 per share.

What is Book-Building Method in Nepal?

Book-Building method is the process of issuing shares through IPO in which shares are issued to Qualified Institutional Investors (QII) in the first phase where cut of price is determined, and afterwards in the second phase shares are issued to general public at a 10% discounted rate from the cut-off rate. You can also check the video below for more clarity about Book Building Method.

Total Issued Capital and Financial Highlights

Reliance Spinning Mills plans to offer 10.14% of its total issued capital, amounting to Rs 1.9 billion, equivalent to 1,926,266 shares. After allocating shares to institutions, the remaining 1,155,960 shares will be available for issuance to the general public.

The company’s financial performance demonstrates promising indicators:

• Net Worth Per Share: As of July, the net worth per share stood at Rs 248.67, showcasing the company’s strong asset base.
• Income Per Share: The income per share is Rs 54.34, reflecting the company’s earnings performance.
• Accumulated Profit: Reliance Spinning Mills has accumulated a substantial profit of Rs 5.63 billion, underlining its profitability and financial stability.

The estimated standard investment payback period for the IPO is 6.88 years, indicating a reasonable return horizon for investors.

Conclusion:

Investing in this IPO presents an opportunity to become a part of a well-established company with promising financial indicators. Ensure to evaluate all information carefully and consult with financial experts before making investment decisions.

Also Read: Sad Reality of Life insurance in Nepal