Prime Life Insurance Company's initial public offerings (IPOs) have been oversubscribed by 10 times. "We floated shares worth Rs 108 million and have received 1,31,607 applications worth Rs 1.872 billion," said Resta Jha, chief executive officer (CEO) of the insurance company. "It's over 10 times the requisition."

Prime Life Insurance floated its public issue on March 9 and closed on March 12. It issued 10,80,000 units of ordinary shares with a face value of Rs 100 per unit. The insurance company has appointed NIDC Capital Market the issue manager for the IPO worth Rs 108 million."Investors have reposed great faith in our company," he said adding that at a time of liquidity crunch too, they received such an overwhelming response to their primary issue. "It shows that the investors have gone through our books that show a net profit of Rs 56.7 million ¿ after tax ¿ in its first year of operations itself."

The insurance company has so far issued 18,9000 policies and collected Rs 520 million worth of premium. After the current issue, the company will have a paid-up capital of Rs 360 million. According to Beema Samiti's (Insurance Board) rule, insurance companies have to increase their paid-up capital to Rs 500 million by 2070 BS. "So, our company plans to give bonus shares worth Rs 140 million to increase its paid-up capital to Rs 500 million from the present Rs 360 million to fulfill the Beema Samiti regulation," Jha said adding that the company has been performing better and is in a condition to give good returns to its investors.

A week ago, Surya Life Insurance had also floated 10,80,000-unit of ordinary shares with a face value of Rs 100 per unit worth Rs 108 million and its shares were oversubscribed by around five times. Manakamana Development Bank also floated Rs 300 million worth shares and its primary issue too was oversubscribed by around five times.

The liquidity crunch had hit `slightly' earlier two issues of Surya Life Insurance and Manakamana Development Bank. Investors lost confidence in the capital market recently also due to the bearish secondary market. Next month, Agriculture Development Bank Ltd (ADBL) is floating the largest ever Initial Public Offering (IPO) in the banking history of Nepal.

After 38 years of its inception, it has got license as an A-class bank from Nepal Rastra Bank (NRB). Now, ADBL has decided to go public with Rs 960 million worth ordinary shares from April 4. Ace Development Bank has been appointed the sales and issue manager. ADBL had registered Rs 1.72 billion profit before tax in the last fiscal year.