A STUDY ON INVESTORS’ PERCEPTION TOWARDS INITIAL PUBLIC

OFFERING IN RATNANAGAR, CHITWAN

A Project Work Report

Submitted By:

Nisha Timalsina
Symbol No.: 703380010
T.U. Reg. No.: 7-2-338-33-2019
Ratnanagar College

Submitted To:
Faculty of
Management
Tribhuvan University
Kathmandu

In Partial Fulfillments of the Requirements for the Degree of

Bachelor in Business Studies (BBS)

Ratnanagar, Chitwan
2024

i
 DECLARATION

I hereby declare that the project work entitled “A STUDY ON INVESTORS’

PERCEPTION TOWARDS INITIAL PUBLIC OFFERING IN
RATNANAGAR, CHITWAN” submitted to Faculty of Management, Tribhuvan
University, Kathmandu is an original piece of work done under the supervision of
Mr. Modhnath Upadhyaya, faculty member, Ratnanagar College, Chitwan, and is
submitted in partial fulfillment of the requirements for the award of the degree of
Bachelor of Business Studies (BBS). This project work report has not been submitted
to any other university or institution for the award of any degree or diploma.

…………………..
Nisha Timalsina
Date:

ii
 SUPERVISOR’S RECOMMENDATION

The project work report entitled “A STUDY ON INVESTORS’ PERCEPTION

TOWARDS INITIAL PUBLIC OFFERING IN RATNANAGAR, CHITWAN”
Submitted by Nisha Timalsina of Ratnanagar College is prepared under my
supervision as per the procedure and format requirements laid by the Faculty of
Management, Tribhuvan University, as partial fulfillment of the requirements for the
award of the degree of Bachelor of Business Studies (BBS). I, therefore, recommend
project work report for evaluation.

…………………………
Mr. Modhnath Upadhyaya
Report Supervisor
Ratnanagar College
Date: …………………

iii
 ENDORSEMENT

We hereby declare that the project work entitled “A STUDY ON INVESTORS’

PERCEPTION TOWARDS INITIAL PUBLIC OFFERING IN RATNANAGAR,
CHITWAN” submitted by Nisha Timalsina of Ratnanagar College, Chitwan, in
partial fulfillment of the requirements for the award of the degree of Bachelor of
Business Studies (BBS) for external evaluation.

………………………. …………………….
Khaga Bahadur Ghimire Shiva Raj Subedi
Management Research Committee Ratnanagar College
Date: Date:

iv
 ABSTRAST

An initial public offering (IPO) is a public offering in which shares of a company are
sold to institutional investors and usually also retail (individual) investors. An IPO is
underwritten by one or more investment banks, who also arrange for the shares to be
listed on one or more stock exchanges. Through this process, colloquially known as
floating, or going public, a privately held company is transformed into a public
company. Initial public offerings can be used to raise new equity capital for
companies, to monetize the investments of private shareholders such as company
founders or private equity investors, and to enable easy trading of existing holdings or
future capital rising by becoming publicly traded.

Investors are those who have invested at least once in IPOs and may or may not have
taken part in secondary market. They are the one who are actively involved in
primary issue of the shares only. Nowadays, there is the rise of investor in stock
market, which is also the good sign for the Nepalese stock market. All it depends
upon the perception of individuals. Perception of an individual's plays an important
role as it helps to interpret something that we see or hear in our mind and use it later
to judge and give a verdict on a situation, person, group etc.

v
 ACKNOWLEDGEMENT

Even though doing research is not an easy task but easy feeling is experienced after
completion of work. Many helping hand has gone into the preparation of this thesis
and thus, the thesis would certainly not be complete without appreciating them.
I would like to express my gratitude to all those people whose works and ideas have
helped me prepare this thesis. Very special thanks goes to Mr. Modhnath Upadhyaya,
Lecturer of Ratnanagar College, Ratnanagar Chitwan whose constant support and
encouragement has been a source of inspiration and without his help, getting the
report ready within such a tenure would have been very difficult for me.

I would like to thank to my friends and colleague who all help to collect the data for
my study. Similarly, I would like to thank all the respondents for providing valuable
time and responses. I am indebted to all the Lectures and Staffs of Campus who
encouraged me for the completion of this research.

Lastly, I extend my deep gratitude to my parents, brothers, sisters for their support
and perpetual cooperation.

Nisha Timalsina
Ratnanagar College
Ratnanagar, Chitwan

vi
 TABLE OF CONTENTS
Page No.
Title page i
Declaration ii
Supervisor’s Recommendation iii
Endorsement iv
Abstract v
Acknowledgement vi
Table of Contents vii
List of Table viii
List of Figures ix
Abbreviation x
CHAPTER - I
INTRODUCTION

1.1 Background of the study 1

1.2 Statement of Problems 4
1.3 Objectives of the Study 5
1.4 Significance of the Study 5
1.5 Limitation of the Study 6
1.6 Organization of the Study 6

CHAPTER - II
REVIEW OF LITERATURE
2.1 Introduction 8
2.1.1 Historical Background of Capital Market in Nepal 8
2.1.2 Financial Market 8
2.1.3 Money Market 9
2.1.4 Capital Market 9
2.1.5 Primary Market 9
2.1.6 Secondary Market 10
2.1.7 Security Market 10
2.1.8 Government Policies 11
2.1.9 Investors’ Perception 11
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2.2 Review of Previous Research Book 12
2.3 Research Gap 14

CHAPTER - III
RESEARCH METHODOLOGY
3.1 Research Design 15
3.2 Population and Sample 15
3.3 Nature and Source of Data 16
3.3.1 Primary Data 16
3.4 Data Presentation and Analysis 16
3.5 Necessary Tools and Techniques 16
3.5.1 Pie-diagram 16
3.5.2 Percentage 17
CHAPTER - IV
DATA PRESENTATION AND ANALYSIS
4.1 Primary Data Analysis 19
4.1.1 Preference over Investment sector 20
4.1.2 Factors Influencing Investors’ perception 21
4.1.3 Difficulties faced by an Investor 22
4.1.4 Allocating Units of IPOs 23
4.1.5 Distortion in IPOs 24
4.1.10 Influence by whom and rumor 25
4.2 Major finding of the Study 25
4.2.1 Major finding from Primary Data 26

CHAPTER- V
SUMMMARY, CONCLUSION AND RECOMMENDATION
5.1 Summary 27
5.2 Conclusion 27
5.3 Recommendation 28
Reference
Questionnaire

viii
 LISTS OF TABLES

Table No. Page No.

4.1 Preference over Investment Sector 26
4.2 Factors Influencing Investors’ Perception 27
4.3 Purpose of Investment 29
4.4 Difficulties Faced by Investors 30
4.5 Pricing of IPOs 31
4.6 Basis of Distribution of Shares 32
4.7 Allocating Units of IPOs 33
4.8 Investors’ Satisfaction 34
4.9 Distortion in IPOs 35
4.10 Influence by Whom and Rumor 37

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 LIST OF FIGURES

Figure No. Page No.

4.1 Preference over Investment Sector 27
4.2 Factors Influencing Investors’ Perception 28
4.3 Purpose of Investment 29
4.4 Difficulties Faced by Investors 30
4.5 Pricing of IPOs 32
4.6 Basis of Distribution of Shares 33
4.7 Allocating Units of IPOs 34
4.8 Investors’ Satisfaction 35
4.9 Distortion in IPOs 36
4.10 Influence by Whom and Rumor 37

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 ABBREVATION

Demat : Dematerialized Account

EPS : Earning per Share
HDL : Himalayan Distillery Limited
IPOs : Initial Public Offering
JBLB : Jeevan Bikas Laghubitta Sastha Limited
MKJCL : Mailung Khola Jal Vidhyut Company Limited
MLBSL : Mahila Laghubitta Bittiya Sastha Limited
NABIL : Nabil Bank Limited
NEPSE : Nepal Stock Exchange
P/E : Price Earnings Ratio
RLI : Reliance Life Insurance
ROI : Return on Investment
RURU : Ru Ru Jalbidhyut Pariyojana Limited
SEBON : Securities Board Of Nepal
TPCL : Terathum Power Company Limited
T.U. : Tribhuvan University
WACC : Weighted Average Cost of Capital

xi
 1

CHAPTER-I
INTRODUCTION

1.1 Background of Study

An initial public offering (IPO) is a public offering in which shares of a company are
sold to institutional investors and usually also retail (individual) investors. An IPO is
underwritten by one or more investment banks, who also arrange for the shares to be
listed on one or more stock exchanges. Through this process, colloquially known as
floating, or going public, a privately held company is transformed into a public
company. Initial public offerings can be used to raise new equity capital for
companies, to monetize the investments of private shareholders such as company
founders or private equity investors, and to enable easy trading of existing holdings or
future capital rising by becoming publicly traded.

After the IPO, shares are traded freely in the open market at what is known as the free
float. Stock exchanges stipulate a minimum free float both in absolute terms (the total
value as determined by the share price multiplied by the number of shares sold to the
public) and as a proportion of the total share capital (i.e., the number of shares sold to
the public divided by the total shares outstanding). Although IPO offers many
benefits, there are also significant costs involved; chiefly those associated with the
process such as banking and legal fees, and the ongoing requirement to disclose
important and sometimes sensitive information.

Details of the proposed offering are disclosed to potential purchasers in the form of a
lengthy document known as a prospectus. Most companies undertake an IPO with the
assistance of an investment banking firm acting in the capacity of an underwriter.
Underwriters provide several services, including help with correctly assessing the
value of shares (share price) and establishing a public market for shares (initial sale).
(https://www.arthachakra.com)

Reasons for going public

a. To raise funds for financing capital expenditure needs like expansion
diversification etc.
b. To finance increased working capital requirement
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c. As an exit route for existing investors

d. For debt financing.

Advantages of Going Public

Stock Holders diversification: As a company grows and becomes more valuable, its
founders often have most of its wealth tied up in the company. By selling some of
their stock in a public offering, the founders can diversify their holdings and thereby
reduce somewhat the risk of their personal portfolios. Easier to raise new capital: If a
privately held company wants to raise capital a sale of a new stock, it must either go
to its existing shareholders or shop around for other investors. This can often be a
difficult and sometimes impossible process. By going public it becomes easier to find
new investors for the business.

Enhances liquidity: The sock of a closely held firm is not liquid. If one of the
holders wants to sell some of his shares, it is hard to find potential buyers-especially
if the sum involved is large. Even if a buyer is located there is no establishes price at
which to complete the transaction. These problems are easily overcome in a publicly
owned company establishes value for the firm: This can be very useful in attracting
key employees with stock options because the underlying stock have a market value
and a market for them to be traded that allows for liquidity for them. Image: The
reputation and visibility of the company increases. It helps to increase company and
personal prestige.

Other Advantages: Like additional incentive for employees in the form of the
companies' stocks. This also helps to attract potential employees. It commands better
valuation of the company. Better situated for making acquisitions.

Disadvantages of Going Public

Cost of Reporting: A publicly owned company must file quarterly reports with the
Securities and exchange Board of India. These reports can be costly especially for
small firms.

Disclosure: Management may not like the idea or reporting operating data, because
such data will then be available to competitors.
 3

Self-dealings: The owner’s managers of closely held companies have many

opportunities for self-transactions, although legal they may not want to disclose to the
public.

Inactive market low price: If a firm is very small and its and its shares are not traded
frequently, then its stock will not really be liquid and the market price may not be
truly representative of the stock's value.

Control: Owning less than 50% of the shares could lead to a loss of control in the
management. The IPO process officially begins with what is typically called an “all -
hands” meeting. At this Meeting, which usually takes place six to eight weeks before
a company officially registers with the Securities & Exchange Commission, all the
members of the IPO team plan a timetable for going public and assign certain duties
to each member. Initial Public offering (IPO), also referred to simply as a “Offering “
or “ flotation”, is when a company issues common stock or shares to the public f or
the first time. They are often issued by smaller, younger companies seeking capital to
expand, but can also be done by large privately - owned companies looking to
become publicly traded. In an IPO the issuer may obtain the assistance of an
underwriting firm, which helps it determine what type of security to issue ( common
or preferred), best offering price and time to bring it to market.

An investor is typically distinct from a trader. An investor puts capital to use for long-
term gain, while a trader seeks to generate short-term profits by buying and selling
securities over and over again. Investors typically generate returns by deploying
capital as either equity or debt investments. Equity investments entail ownership
stakes in the form of company stock that may pay dividends in addition to generating
capital gains. Debt investments may be as loans extended to other individuals or
firms, or in the form of purchasing bonds issued by governments or corporations
which pay interest in the form of coupons. (https://www.investopedia.com)

In this research, investors are those who have invested at least once in IPOs and may
or may not have taken part in secondary market. They are the one who are actively
involved in primary issue of the shares only. Nowadays, there is the rise of investor in
stock market, which is also the good sign for the Nepalese stock market. All it
 4

depends upon the perception of individuals. Perception of an individual's plays an

important role as it helps to interpret something that we see or hear in our mind and
use it later to judge and give a verdict on a situation, person, group etc. Perception is
very important in understanding human behavior because every person perceives the
world and approaches life problems differently. If people behave on the basis of their
perception, we can predict their behavior in the changed circumstances by
understanding their present perception of the environment. Thus, perception of an
investor is very much essential and plays and important roles for a IPOs. Perception
of individuals also depends on different factors interest, expectation, and attitude.
Positive attitude and interest is very much essential as it helps investors to motivates
and actively participate in IPOs. Investors they also expect handsome amount of
return in their investment. If investor got as per the expectation they show the positive
attitude towards IPOs and also influence other people towards IPOs. Positive factor of
IPOs should be spread which helps to make goods perception of and newly investor
towards IPOs.

In present condition applying in IPOs and after being allotted and listed in stock
exchange then investor get the return more than expected. This is also why there
seems to have an active participation of investors. Hence positive factors of IPOs
have developed good perception towards investors’.

1.2 Statement of Problem

Nepalese capital market is very small in comparison with other developed stock
markets. There are a few numbers of brokers, limited number of listed companies,
very few transactions and most importantly investors are unknown about the pros and
cons of the stock market. If there occur a single malpractice in the functioning of
securities market, the whole capital market may damage the national economy badly
and if once the investors’ confidence were lost it would very difficult to bring it in
original condition.

There are various types of difficulties in initial public offering in Nepal. In developed
countries, generally people are aware from public offering. However, in developing
countries like Nepal, IPO is still a new phenomenon. About 32.1 percent of the people
still have no education. They don't know what the public offer is. Why should they
 5

invest their money in stocks? And some of the most literate do not know anything
about the practice of actions. They have no idea what the titles mean. How can we
expect them to invest in securities? And even among dedicated people there is lack of
self-confidence. They don't want to take risks. In developing countries like Nepal,
IPO is still a new phenomenon.

To control this, Security Board of Nepal (SEBON) recently introduced a new set of
rules, in order to make the IPO transparent. Now it is compulsory for each retail
investor to have a bank account and to furnish attested copes of citizenship certificate.
Also the issue managers are required to part the application money in an account with
the Nepal Rastrya Bank for three days after the IPO has been closed. . If an applicant
does not get the stock allotted on his /her name, the money is returned to him
The problem towards which this study is directed is to identify the investors’
perception towards

IPO in Nepalese market, how is primary market growing in Nepal, how are the issue
that are being handle by SEBON. In present context of Nepal, as there is rapid
increment in the number of applicants for IPOs the chance of getting IPOs it depends
on the luck of applicants. The increase in craze of people also makes SEBON to think
about changing the present system of allocating 10 units of the share and investor
perception towards allocating minimum 10 units of IPOs.

There are various types of obstacles existing initial public offering stages in Nepal. In
developed country, generally people are aware from public offering. Therefore, many
problems are found in the field of public offering in Nepalese stock market rather than
other developed countries. Besides these, there are other factors, which slow down the
pace of stock market growth in Nepal. They are Political instability, unconfident
investors, Lack of institutional investors, lack of trained and qualified manpower and
insufficient knowledge of investment about the security market.
This present study is carried out to answer the following research questions:
a. What is an investors’ perception towards initial public offering?
b. What is the investors’ perception towards allotment of minimum ten units of
IPOs?
 6

1.3 Objectives of the Study

The objective of the study is to study about the initial offering or primary issue of
shares in perspective of Nepal and find out the investors’ responses and preference.
To be more specific, this study keeps the following objectives.
a. To examine about the investor perception towards initial public offering.
b. To analyze the perception of investor towards allotment ten units of IPOs.

1.4. Significance of Study

IPO is one of the crucial factors for general investors and public company. This study
is being undertaken to evaluate the perception of investors towards initial public
offering in Nepalese primary share market. This study seems to be helpful to the
prospective investors and the organization in the field of public Offering as there is
still lack of study regarding IPO in Nepal. This study will assist in the formulation of
policy and will assist the policy makers to get the practical knowledge of existing
rules and regulations.

From this study, investors will have more clear conception over their investment and
they will be able to make a right choice. It can be useful in various sectors such as:
a. It will be helpful in the near future who want to study and make research in
IPO.
b. In Nepal, there is still lack of study about initial public offering. Therefore,
this study is expected to helpful for the general investors and the organization
that directly or indirectly related in Initial Public Offering.
c. This study will be significant to analyze the legal provision, possibilities,
problems and prospects of IPO in Nepal.
d. It will also be helpful to know the investors response to IPO of different
sectors. The prospective offering company may also get significant knowledge
from this study.

1.5. Limitation of Study

This study will have some limitations. Basically the study is done for partial
fulfillment of master of Business studies. Time constraints, financial problem and lack
of research experience will be the primary limitations of the research. The perception
of investor towards initial public offering has also some limitation.
 7

a. The study is conducted with only the investor who has taken part in IPOs;
investor in secondary market is not included.
b. Some of the persons were not so responsive. Respondents may not be prepared
to contribute to the research due to lack of time and resources required.
c. Possibility of error in data collection because many of investors may have not
given actual answers of questionnaire.
d. Sample size is limited to 64 investors.
e. The research is confined only to the Ratnanagar municipality.
f. The study will be based on the data of 2024.

1.6 Organization of Study

The study organized into five chapters, each devoted to some aspect of the study of
initial public offering followed by financial institutions in Nepal. The fields of each of
these chapters are as follows:

Chapter – I: Introduction
This chapter contains introductory part. It describes the general background of the
study, statement of the problem, objective of the study, significance of the study,
limitation of the Study and organization of the study
Chapter - II: Review of Literature
This chapter is devoted to theoretical analysis and brief review of related and
pertinent literature available. It includes a discussion on the conceptual framework
and review of the major studies.

Chapter – III: Research Methodology

This chapter describes the research methodology employed in the study. This deals
with the nature and sources of data, list of the selected companies, the model of
analysis, meaning and definition of statistical tools.

Chapter – IV: Data Presentation and Analysis

This chapter deals with the presentation and analysis of data by using different
statistical tools.
 8

Chapter - V: Summary, Conclusion and Recommendations

This chapter states summary, conclusion, and major findings of the study. And finally
depending upon the summary and conclusion, recommendations have been given. The
Bibliography and annexes are incorporated at the end of the study.
 9

CHAPTER- II
REVIEW OF LITERATURE

2.1 Introduction
Review of literature means reviewing research studies or other relevant prepositions
in the related area of the study so that all the past studies, their conclusions and
deficiencies may be known and further research can be conducted. The main reason
for a full review of research in the past is to know the outcomes of those
investigations in area where similar concepts and methodologies have been used
successfully. The first part of the chapter deals with the theoretical framework and the
second part are concerned with review of empirical works.

2.1.1 Historical Background of capital market in Nepal

Flotation of shares by Biratnagar Jute Mills Ltd. in 1937 was the first public issue in
Nepal. Nepal Bank Ltd. and many other companies also issued share to public during
that period. The history of securities market thus goes back to almost seventy years,
but the actual development of the market took momentum only after the restoration of
multiparty democracy in the country in 1990. However, the introduction of the
Company Act in 1964 and the first issuance of Government Bond in 1964 were some
steps taken towards developing securities market during 1960s. One of the significant
developments relating to capital market was the establishment of Securities Exchange
Centre Ltd. in 1976.

The main objectives of establishing Securities Exchange Centre was to promote and
facilitate the growth of capital markets in Nepal. For about seventeen years, it was the
only capital market institution undertaking the job of brokering, underwriting,
managing public issues, market making for government bonds and other financial
services.

2.1.2 Financial Market

Financial Markets provide a forum in which suppliers of loans and investments can
transact business directly. The loans and investments of institutions are made without
the direct knowledge of the suppliers of funds (savers), suppliers in the financial
markets know where their funds are being lent or invested. The two keys of financial
 10

markets are the money and the capital market. Transactions in short term debt
instruments, or marketable securities, take place in the money market. Long term
securities (bonds and stocks) are traded in the capital market Gitman,1988:30).

2.1.3 Money Market

Money market activities include primary and secondary market activities in short-
term negotiable instrument such as Treasury Bills, Government Bonds, Certificate of
Deposit, Banker’s Acceptance And commercial Paper or Promissory Notes. Merchant
Banks are usually users and market-makers (dealers), rather than brokers in these type
of paper. In theory, the money market is different from capital market. In practice,
however, in most country with efficient financial markets (i.e. money market and
capital market combined), the merchant banks are active in both.

2.1.4 Capital Market

The capital market is defined as a place where companies raise funds to meet their
funding needs for new funds, modernization and expansion programs, long-term
working capital needs and various other purposes. The capital market mobilizes
savings from individuals as investments in stocks, bonds, mutual fund shares and
similar financial instruments that are ultimately used for productive purposes in
various sectors of the economy.

A place where long term lending and borrowing takes place is known as capital
market. The capital market is the market for long -term loans and equity capital.
Companies and the government can raise funds for long-term investments via the
capital market. The capital market includes the stock market, the bond market, and the
primary market. Securities trading on organized capital markets are monitored by the
government; new issues are approved by authorities of financial supervision and
monitored by participating banks. Capital market refers to the links between lenders
and borrowers of funds, arranging of funds -transfer process to seek each other's
benefit.
 11

2.1.5 Primary Market

The primary market is that part of the capital market that deals with the issuance of
new securities. Companies, governments or public sector institutions can obtain
funding through the sale of new stock or bond. This is typically done through a
syndicate of securities dealers. The process of selling new issues to investors is called
underwriting. In the case of a new stock, the sale is an initial public offering (IPO),
though it can be found in the prospectus. Features of Primary market:
• The new securities are traded in primary market.
• Primary market makes the financial capital available to make new investments
in building equipment and stock of necessary goods.
• The securities are sold for the first time.
• The securities are issued by the company directly to investors.
• Used by the companies for the purpose of setting up new business or for
expanding or modernizing the existing business.
• Facilitates capital formation in the economy.
• Buying security in primary market is less risky.

2.1.6 Secondary Market

In the secondary market the share once issued in the primary market are traded. So,
the secondary market liquidates the shares and provides the opportunity between the
investor and seller of the securities. The company must list the securities in the
security market for the transaction purpose. Secondary market provides no capital to
the original issuer. In the secondary market existing securities are traded and thus
enabling disposal of these securities whenever the owners wish. An active secondary
market is therefore a necessary condition for an effective primary market, as no
investor wants to fell 'locked in ' to an investment.

2.1.7 Security Market

Security market sets a price for the securities it trades and makes it easy for people to
trade them. Securities market facilities the sale and re sale of transferable securities.
The security market can be defined as a mechanism for bringing together buyer and
seller of financial assets to facilitate trading. Securities market is classified into two;
the market in which new securities are sold is called the primary market and the
market in which existing securities are resold is called the secondary market.
 12

Secondary markets are created by brokers, dealers and market makers. Brokers bring
buyer and seller together with themselves actually buying or selling; dealers set price
at which they themselves are ready to buy and sell (bid and ask price respectively).
Broker and dealer come together organized market or in stock exchange (Gitman,
1992:457).

This study is only concerned with initial public offerings so, it deals with the process
and activities incurred in rising of funds from the primary market. The operation of
the secondary market, though is an important operation scope of the merchant
banking, is not covered in this manual. Primary market and the secondary market are
present in both the capital market and the money market.

2.1.8 Government policies

A country's government shapes the business environment in which companies
operate. Government policies such as changes to regulations, taxation, interest rates
and spending programs therefore have a huge influence on individual companies'
performance and their stock price. The stock market is a major financial entity with
players both large and small. The market facilitates public ownership of corporations
while also providing a trading industry with many different types of careers. The
federal government regulates much of the stock market's activity to protect investors
and ensure the fair exchange of corporate ownership on the open markets.

2.1.9 Investors’ Perception

Investor’s perception refers to the choosing, purchasing and consumption of goods
and services for the satisfaction of their wants. There are different processes involved
in the investor perception. Basically the investor attempts to find what kind of
investments he/she would like to consume, after that investors selects only those
investments that promise greater utility. After selecting the investment, the investor
makes an estimate of the available money which he/she can spend. Lastly, the
investor analyzes the prevailing prices of investment and takes the decision about the
investment he/she should consume. There are the different factors that affects the
investors’ perception, Short term profitability, Company Performance, Risk Factor,
and Return on investment.
 13

Short Term Profitability. A short-term gain is a profit realized from the sale,
transfer, or other disposition of personal or investment property (known as capital
assets) that has been held for one year or less. A short-term capital gain occurs when
an investment is sold that's been held for less than one year, such as a stock. These
gains are taxed as ordinary income, which is your personal income tax rate.

Company performance. Successful firms represent a key ingredient for developing

nations. Many economists consider them similar to an engine in determining their
economic, social, and political development. To survive in a competitive business
environment, every firm should operate in conditions of performance. Nowadays,
firm performance has become a relevant concept in strategic management research
and is frequently used as a dependent variable. Although it is a very common notion
in the academic literature, there is hardly a consensus about its definition and
measurement. However, due to the absence of any operational definition of firm
performance upon which the majority of scholars’ consent, there would naturally be
diverse interpretations suggested by various people according to their personal
perceptions. Definitions of this concept may be abstract, or general, less or clearly
defined.

Risk Factor. Risk factors are the building block of factor investing. A risk factor is an
underlying characteristic or exposure that can be used to explain the return profile of
an asset class. The return profile of a bond, for example, is tied to risk factors such as
duration, credit spreads and default risk, while a stock’s returns are linked to factors
such as size, value and momentum. Macroeconomic risk factors include volatility and
inflation. Risk factor-based allocation works by determining the underlying risk
exposures that contribute to each asset’s returns, and then selecting assets based on
those exposures, to create a portfolio that best reflects the investment thesis while
simultaneously diversifying risk. For example, in order to gain exposure to currency
risk, a portfolio manager could invest directly in currencies, or gain exposure
indirectly though assets that are exposed to the same risk factors.

Return on Investment. Return on investment (ROI) is a calculation used to assess a

company's efficiency at allocating the capital under its control to profitable
investments. The return on invested capital ratio gives a sense of how well a company
 14

is using its capital to generate profits. Comparing a company's return on invested

capital with its weighted average cost of capital (WACC) reveals whether invested
capital is being used effectively. This measure is also known simply as "return on
capital." Return on investment (ROI) is the amount of money a company makes that
is above the average cost it pays for its debt and equity capital. The return on invested
capital can be used as a benchmark to calculate the value of other companies

2.2 Review of Previous Research Book

The role of the Primary market has been increasing now days. Any corporation can
raise its required fund through Primary market and its process. It can use such savings
into investments in productive sectors. It definite leads to the economic growth. So
the primary market is playing a role for the development of national economy.

Kunwar (2016) studied about the awareness, perception, and investment decision of
individual investors towards IPO in Nepal and to investigate the factors that affects
investment decision on IPO. The study used descriptive and inferential analysis. The
study used the primary data from 116 respondents. The study found that there was a
positive perception of investors towards IPO in Nepal. The study also revealed that
awareness level of investor was well above the needed level and the perception of
investor towards IPO and awareness level of investor is indifferent based on their
gender, age, occupation and monthly income.

Adhikari (2017), made an attempt to identify the factor influencing individual

investor’s behavior during IPO in Nepal. The basic purpose of the study is to analyze
and examine the investor’s perception and factors that influence individual investor
behavior during IPOs in Nepal. In this study exploratory and descriptive research
design was used. The data used primary data and it was collected through
questionnaire from 100 respondents. The study found out that capital appreciation,
investors demographics trends, preferred source of information, and industry
specialization are the most important factors before making investment decision in
IPO. Adoption of interest, social media, mobile marketing and awareness program
will enhance the public knowledge on IPO and investment at the stock exchange.
 15

Pandey (2013) who has done research on, "Public response to Primary Issue of Shares
in Nepal," with the objective of: identify the problems of primary share issue market,
assess the growth of primary issue market, analyze the pattern of public response to
shares & find the reasons of variation. Mr. Pandey has summarized his find as: Public
response in primary market is high due to lack of opportunities for investment in
other fields. No proper investment analysis is been made. Despite this, public are
attracted towards shares than other sectors, basically to increase their value of
investment, be it dividend capital gain or bonus shares. It can be seen that public
response to primary issues on Banking and Financial sectors is normally higher than
that of the manufacturing and services sector. Major causes for poor response in
interest rates were higher as compared to dividend yield, the public companies were
not performing well and people did not know about the importance of investing
securities. Now the response is highly positive because people are aware, money flow
in the market is higher, people have seen that most companies are distributing
dividends, share prices are increasing for most companies and a lack of better
alternatives for investment. Now that the average interest rates have gone down, more
can be obtained from investment in stock.

Paudel (2015), who has done research on "Public Response to IPO in Nepal”. With
the objective of identify the dealing process of IPO, analyze the pace of IPO and
analyze the public response to IPO. He has concluded that general investor in Nepal
does not have sufficient information regarding the primary market and in spite of this
they are interested in investing money in the primary market. They are more
interested in financial sector than non-financial sector. He has also summarized that
pace of IPO in Nepal seems to be irregular. Even though the organization's process of
public offering is quite long, the service provided to the investors seems to be
satisfactory. Public response in stock market is high due to lack of opportunities for
investment in order to sector. Despite this, public are attracted towards shares to
increase their value of investment.

2.3 Research Gap

Nepali investors have developed an increasing interest in the primary market,
especially the primary market, has been fast growing. The majority of Initial Public
Offerings (IPOs) are highly oversubscribed. However, though investing in IPOs often
 16

guarantees return, there is also risk in such investments. The investor should be aware
of these risks and returns.

However, there are many researches related to public response to IPO in Nepal, but no
one has given focus on pricing of IPO with premium or face value, objective of
investors as long term investment or quick way to make money, the role of whom and
rumor to investing decision of investors while investing which affects the share
market significantly. Furthermore, previous studies had not conducted research for
analyzing perception of investors towards allocating 10 units of IPOs and also the
interest of investors towards book building has not been analyzed. Recently collected
data has been used to examine the perception of investors towards initial public
offering. Thus with this several of research gap found in previous studies, the
research has been conducted to analyze the investors’ perception in the process of
IPOs.
 17

CHAPTER-III
RESEARCH METHODOLOGY

Research methodology is the general research strategy that outlines the way in which
research is to be undertaken and, among other things, identifies the methods to be
used in it. These methods, described in the methodology, define the means or modes
of data collection or, sometimes, how a specific result is to be calculated.

Research Methodology refers to the various sequential steps to adopt by a researcher

in studying a problem with certain objectives in view. It tries to make clear view of
method and process adopted in the entire aspect of the study. It is known as a path
from which we can systematically solve the research problem. This research tries to
perform a well-designed qualitative research in a very clear and direct way using
different statistical tools. Detail research methods are described in the following
headings.

3.1 Research Design

Research design is the conceptual structure within which research is conducted. In
other words, a plan of study or blue- prints for study is called research design or
research strategy. It facilitates the smooth sailing of the various research operations,
thereby making research as efficient as possible. Research design is a plan, structure
and strategy to obtain the objectives of the study.

This research is based on primary and secondary data analysis. Hence descriptive
research design was used to know about the investor perception towards initial public
offering of Nepalese stock market. It deals with the stock market on the basis of
available information which is useful for conducting research.

3.2 Population and sample

The large group about which the generalization is made is called the population under
study. The totality of objects, things or human being under the study area, which can
provide the information required for research is known as population of the research.
The study is based on the information of the investors in IPOs. Therefore, total
number of investors is the size of population of the research. Because of large group
 18

size, it is difficult to collect from each member; hence study is conducted from 64
different investors which is also the sample of this research study. For this study
convenient sampling techniques is used, as it is non-probability sampling method that
relies on data collection from population members who are conveniently available for
this study.

3.3 Nature and Source of data

To accomplish the above mention objectives both primary and secondary method of
data collection is used to complete the study. The study aims at finding out the
attitude of the investors towards IPO in Ratnanagar, municipality.

3.3.1 Primary Data

Primary data gives real shape to the work. Discussion, questionnaire, interviews with
existing investors, and newly introduce investor who are only investing in IPOs have
been conducted to collect the primary data. As per the requirement of the research a
questionnaire was designed for the primary data collection. And then that was
distributed to 122 respondents (student, teacher, Business, and others) for their
responses.

3.4 Data presentation and Analysis Method

After the collection of data, an analysis of the data and the interpretation of the results
are necessary because data collected from various sources might be in raw form. So,
they cannot be used directly. Further, they need to be verified and simplified for the
purpose of analysis. The obtained data should be classified and tabulated in the
required format according to the nature of data and requirement of the study. Data
analysis helps to make the reader clearer about the research and helps to draw
conclusions. This part contains several statistical tools.

3.5 Necessary Tools and Techniques

Different relevant statistical tools are used to find out the best appropriate result as per
the designated objectives of the study. The study has used the different financial and
statistical tools, different diagram, chart as well as descriptive methods as per the
requirements and their suitability. The techniques that are applied in this study are.
 19

3.5.1 Pie – diagram

A pie- diagram is a widely used aid that is generally used for diagrammatic
presentation of the values differing widely in magnitude. In this method all the given
data are converted into 360 degrees as the angel of a circle is 360 degrees and all
components of the data are presented in terms of angels that total 360 degrees for one
set of data.

3.5.2 Percentage
Percentage is one of the most useful tools for the comparison of two quantities or
variables. Simply, the word percentage means per hundred. In other words, the
fraction with 100 as its denominator is known as a percentage and the numerator of
this fraction is known as rate of percent.
 20

CHAPTER- IV
DATA PRESENTATION AND ANALYSIS

This chapter includes presentation of data and analysis of data to reach at a

conclusion. Data presentation and interpretation is the important part of a research
work which analyze the data and information using various tools and techniques to
get the best results. The primary data are used in this research is to analyze the public
response, investor perception, choice for investment etc. The data are collected
through primary sources. Such collected data are presented in systematic formats and
analyzed using different tools and techniques.

To meet the objectives of study about the responses of investors, the study is made
with questionnaire survey. The questions are responded form students, teacher,
business, and others included in this study as respondents. The study is based on the
investors who are investing in IPO and involve in financial market. Most of the
respondents belong to the age group of 20-24, followed by 25-34, and 35-44. This
shows that Age group of 25 to 34 are highly invest in capital market and IPO.

This chapter deals with data presentation, analysis and interpretation following the
research methodology presented in the third chapter. Data presentation and analysis
are the central steps of the study. The main purpose of this chapter is to analyze and
elucidate the collected data to achieve the objective of the study following the
conversion of unprocessed data to an understandable presentation. The chapter deals
with the main body of the study.

This chapter provides results obtained from the survey, which have been examined
and evaluated through data analysis techniques. In this course of analysis, the
collected data have been presented in the tables, figures and diagrams and then
analyzed by using different tools. The results of the computation have also been
summarized in appropriated tables. This chapter includes presentation of data and
analysis of that data to reach at a conclusion.
 21

4.1 Primary Data Analysis

The analysis of primary data collected through questionnaire is presented in this
section. The questionnaires were distributed to investors in order to identify their
perception towards IPOs. To meet the objectives of the study about the responses of
investors, the study is made with questionnaire survey. The questions are responded
from 122 respondents.

4.1.1 Preference over Investment sector

Most of the retail investor of Nepalese IPO market is speculators who bet their money
on any kind of IPO without properly analyzing the offer documents. This is partly due
to the lack of diversity of stocks in the market which is dominated by the stocks of
banks and financial institutions. Most of the IPOs are from this sector.

Table: 4.1 Preference over investment sectors

S.N Investment sector No of Respondents Percentage (%)
1 Banking Sector 16 25.00
2 Insurance Company 13 20.00
3 Microfinan 22 35.00
4 ceManufacturing
Sector &Production 6 9.00
5 Company
Hydroelectricity 7 11.00
Total 64 100
(Source: Questionnaire No. 1)

The table shows that most of the investors are keen on investing in the IPO of micro
finance companies which is followed by Banking and Insurance. The interest of the
investors in hydroelectricity remains average. There are only few investors in
Manufacturing and Production sector.
 22

Figure 4.1 Preference over Investment Sectors

In which sector IPOs do you think have more opportunity for
investment to the public?
Banking Sector
Insurance Company
Microfinance Sector
Manufacturing
&Production
11% Company
9% 25%
Hydroelectricity

35% 20%

(Source: Questionnaire No.1)

According to the answer provided by the investors it was found that maximum
number of the investors are interested in investing in IPO of microfinance sector that
is 35 percent followed by investors in Banking and Finance sectors. There are very
few people who invested in IPO of Manufacturing and Production sector that is 9
percent.

4.1.2 Factor Influencing Investors’ Perception

Most of investors prefer the microfinance sectors as we found in previous study.
Investors prefer the good will of the companies and in this regard now microfinance
sector take over the high place in the Nepalese market. Very least investor gives
emphasis toward the manufacturing and production type of company.

Table 4.2: Factor Influencing Investors’ Perception

S.N Factor influencing Investors’ Perception NO of Respondents Percentage
1 Promoters Background 5 8.00
2 Company Performance 45 69.00
3 Market Information 14 23.00
Total 64 100
(Source: Questionnaire 2)
 23

The table 4.2 shows that most of the investors are interested to know about company
performance while making an investment. This knowledge and information is
essential for an investor so that the investment doesn’t go in vain. Also some investors
believe that market information and promoter’s background is also necessary for
doing investment

Figure 4.2 Factors Influencing Investors’ Perception

What Do Investors See Before Investing?

8%
23%
PROMOTERS BACKGROUND
COMPANY PREFORMANCE
MARKET INFORMATION
69%

(Source: Questionnaire No.2)

Figure talks mainly about the various factors that should be considered before
investing in an IPO. Out of total samples taken, 69 percent of the people prefer that
one should consider performance of existing company. Whereas 23 percent believe
that market information needs to be considered and the rest 8 percent feel that the
promoters are the most important factor for taking a decision in the investment of
IPO.

4.1.3 Difficulties face by investors

Various difficulties are being faced by an investor during the application as well as
after application of IPOs, as they are unknown about it.
 24

Table 4.3 Difficulties face by investors

S.N Difficulties face by investors No of Respondents Percentage
1 Refunding Problem 14 21.00
2 Delay in crediting allotted shares 24 38.00
3 No clarity in allotment 10 16.00
4 None of the above 16 25.00
Total 64 100
(Source: Questionnaire 3)

Tables shows that delay in crediting allotted shares is the major difficulties that is
faced by investors as it depends upon the share registrar capital, because of the poor
performance of the merchant bankers or investment companies share are not being
credited in dematerialized account (DEMAT) on time.

Figure 4.3 Figure: Difficulty faced by investors

What difficulties you face after applying for IPOs?

25% 21% Refunding Problem

Delay in crediting alloted shares
No clarity in allotment
16% None of above
38%

(Source: Questionnaire No. 3)

Figure, mainly talks about the problems faced by the investors after applying for
IPOs. We can see that 38 percent of the respondents have faced problem i.e. Delay in
crediting allotted shares whereas 21 percent of the people have the problem with
Refund and 16 percent faced problem of No clarity in allotment of shares whereas 25
percent respondents have not faced any problem after applying for IPOs.
 25

4.1.4 Allocating units of IPOs

Due to the over subscription of the shares allotment of the shares is done via lottery
method by allocating 10 units of IPOs.

Table No 4: Allocating units of IPOs

S.N Allocating Units of IPOs NO of Respondents Percentage
1 Should be Continue 20 31.00
2 Size of allotment should be increased 44 69.00
Total 64 100
(Source: Questionnaire 4)

Table shows that the allotment of the units of shares should be increased than the
present prevailing as they can get more advantages if allotted and have more financial
advantages of additional units. Todays, most of the investor they haven’t got the
shares as per their demand which shows that investors are willing to invest but they
are not getting the chance for doing investment. Thus, government should establish
different companies so that investors they can invest according to their needs.

Figure 4.4 Allocating units of IPOs

What is your opinion towards allocating 10 units of IPOs?

31%
Should ne continue
Size of allotment should be increase
69%

(Source: Questionnaire No.4)

Data Interpretation: Figure mainly talks about allocating units of IPOs. More than 2/3
of the investor (that is 69percent) they prefer to have an increase in allocating the size
of an allotment of IPOs. Only 31 percent of an investor they prefer to continues the
present method of allocating share units. This shows that if participants are allotted
than they can take more advantages of additional units of IPOs.
 26

4.1.5 Distortion in IPOs

Increase in number of applicant has resulted in less chance of being allotted.
Therefore, more number of applications is being applied by single person.

Table 4.5: Distortion in IPOs

S.N Distortion in IPOs NO of Respondents Percentage
1 Yes, of course 33 51.00
2 No, not at all 31 49.00
Total 64 100
(Source: Questionnaire 5)

Table shows that allocating 10 units of IPOs has brought the distortion in Nepalese
Share Market as most of the investors they are using multiple accounts of different
person for applying IPOs. This has resulted an increase in the number of applicants
for an IPOs.

Figure 4.5Distortionin IPOs

Don’t you think that allocating 10 units of IPOs have brought

distortion in Nepalese share market ?

Yes, of course
49% 51%
No, not at all

(Source: Questionnaire No. 5)

Figure mainly talks about distortion in IPOs in Nepalese share market. The percentage
of reply for having distortion because of allocating 10 units of IPOs in Nepalese share
market is 51 percent while 49 percent are against it. It shows that due to the increase
in number of applicants, result, and the expectation of increase in allotment. Hence
there is increase in applicants which ultimately result distortion in the market.
 27

4.1.6 Influence by whom and rumor

Nepalese investors have been influence with whom and rumors as well as they are not
well informed and aware of features of initial public offering. Much of them have
become investors without knowing anything, just in a hunch, or by accident.

Table 4.6 Influence by whom and rumor

S.N Influence by whom and rumor No of respondents Percentage
1 Very high 31 49.00
2 High 21 33.00
3 Moderate 12 18.00
4 Low 0 0.00
Total 64 100
(Source: Questionnaire 6)
Table shows that most of the investors they are highly influenced by the rumors this is
why the active investors in Nepalese Share Market are increased.
Figure 4.6 Influence by whom and rumor

Do you think that Nepalese investors are influenced by rumors?

0%
18% Very high
High
49%
moderate
33% Low

(Source: Questionnaire No.6)

Figure mainly describes how the investor they are influenced. The above chart shows
the investors attitude towards whom and rumor is very high. Nepalese investors are
highly influenced by whim and rumor rather than their own knowledge and capacity.
 28

4.2 Major Findings of the Study

4.2.1 Major Findings from Primary Data
1. The study found that the majority of investor are keen on investing within the
IPO of micro finance companies which is followed by Banking and Insurance.
The interest of the investors in hydroelectricity remains average. There are
only few investors in Manufacturing and Production sector.
2. Investors in Nepal are highly influenced by company performance, as 69% of
investors evaluate company performance in IPO investments and only 23%
are interested in market information, while only 8 % of investors are interested
by looking over the image of promoters.
3. Most of the investor’s, i.e. about 38% they face problem of delaying in
crediting the allotted shares while there's a drag for refunding amount for 21%
of an investor and also 16% investor they're not clear about allotment of the
shares. And therefore the remainder of 25% of an investor they don’t have any
problems after applying for IPOs.
4. Since there is a rule of allocating at least 10 units of IPO. Most investors seem
to prefer an increase in share size. As a result, 69% of investors prefer an
increase in share size.
5. About 51% of investors believe that allocating 10 units of IPO has brought
distortion in Nepalese share market as most of the application are submitted
by single individuals from multiples account of different person.
6. Most retail investors were greatly influenced by rumors in the market. When
investors make investment decisions on whom or rumor, they are aware that
they too are inseparable from it.

From the analysis of response to questionnaire, it comes to know that if any reputed
company tries to promote and provide aware about IPO market, concerned body
should give support to encourage to the investors.
 29

CHAPTER - V
SUMMARY, CONCLUSION AND RECOMMENDATION

5.1 Summary
The primary market is the market where shares are issued for the first time for general
public. The basic procedure for the primary market is initial public offering (IPO).
The securities market includes primary market and the secondary market. The
primary market helps companies offer new securities, start new businesses or raise
funds for existing expansion and diversification. The development of the securities
market in Nepal is in the early stages of development.

The securities market plays a strong role in bringing in contact with the firm and
individuals. Therefore, it can be said that public confidence is highly dependent on
the functioning of SEBON as a regulatory authority. Securities Exchange Board
Nepal is Nepal's stock market regulator. Stock Exchange Limited is a trading
company. The company has to get approval from SEBON before going public. Upon
approval, the issuing company notifies the Office of the Nepal Stock Exchange
Limited and the Registrar of Companies.

The main purpose of this study is to evaluate investors' perceptions about the initial
public offering; the study also focuses on allocating 10 units of IPO. This study is
based on primary data analyses. Descriptive research design has been carried out for
the study. For the further support of this study, survey of questionnaire from various
respondents has been taken. The data gathered for this purpose are presented in tables
and charts.

From the analysis of primary data, it is seen that public response to the primary
market is highly positive because people are getting aware of stock market, flow of
money in the market is higher, people have seen that most companies are distributing
dividends, share prices of most companies are increasing and there is also a lack of
better alternative for investment. Nepalese stock market is the characteristics of rumor
based market. There is insufficient knowledge of investors about the stock market
which is the major problems of Nepalese Stock market. Despite this, public are
attracted towards shares to increase their value of investment.
 30

5.2 Conclusion
Nepali investors are showing growing interest in the capital market. Although the
primary market is still growing, it is growing rapidly. Most ordinary investors in
Nepal do not know enough about the primary market, but they are still interested in
investing in the primary market. This is a good sign for the expansion of the primary
market. There is an active participation of an investors in every IPOs that have been
issued. Virtually every sector receives a good response from the public. In particular,
the microfinance sector is preferred by the population over other sectors.

Even though the organization's process of public offering is quite long; the service
provided to the investors seems to be satisfactory. If raising interest of the public in to
primary market is one of the objectives, then the primary market of Nepal is fulfilling
this role gradually. The structure of the primary market has witnessed significant
change. Some of the important development in the primary market which deserve
specific mention are the establishment of merchant banks, provision of speedy up
allotment/refund, proportionate allotment of shares, allotment of financial institution,
increase in minimum application amount of investment in primary issue such change
have brought significant public response in new issue.

IPO markets are always fruitful for companies to increase market capitalization.
However, companies need to make a good decision about the type of issues and
understand the market sentiment in order for their IPO to be successful. Similarly, the
regulator should inform and inform the market about the IPO, and advise investors to
make their decision not only on information. As the capital market continues to grow,
investors can expect more IPOs in the future. In addition, the rules and regulations
will be developed and improved.

5.3 Recommendation
To make the IPO more efficient, effective and convenient, following suggestions are
recommended:
1. Investing in stocks is a risky opportunity. To be successful in the stock market,
investors must always be aware of their strengths, weaknesses, requirements,
desires, risk tolerances capacity, and their reaction to ever-changing market
 31

conditions. Investors shouldn't buy stock in any company until they know
more about it.
2. Investment bankers and issuance managers play an important role in the IPO.
Hence they should be more transparent, faster and service provider so that
more people can participate in the IPO.
3. Small investors are also part of the primary market, so the financing of IPOs
through financial institutions should be strictly regulated to discourage large
investors from submitting multiple offers using the identity documents of
many others.
4. After the allotment of shares if an applicant does not get the stock allotted on
his/her name, the blocked amount should be returned to him/her within a day
after allotment. Similarly, the share registrar they should credit the allotted
shares to respective demat account on time.
5. Application from each corner of the country should be asked so that all
interested candidates could apply on IPO. As it is found that most of the IPO’s
are concentrated in the cities areas only.
6. Presently, intuitional players have not been able to play any noticeable role in
the stock exchange. Limited market, allotment procedure and emphasis of
small investors have not helped to enhance the role of the institutional players.
Increased role of such players will make the market more competitive.

While investing in the primary market, the major consideration should be made that
of the promoters, directors and managers in Nepal. Other considerations may be
market prospect, professionalization of management and overall environment.
 REFERENCE

Adhikari, H. C. (2017). Factor influencing individual investors’ behavior during

Initial Public Offering (IPO) in Nepal (An unpublished master degree thesis).
Central Department of Management, Tribhuvan University, Kathmandu.
Kunwar, A., (2016). Awareness, perception and investment decision of individual
investors towards Initial Public Offering (IPO). An unpublished master degree
thesis, Central Department of Management, Tribhuvan University
Pandey, S. (2013). Public Response to Primary Issue of Share in Nepal. Unpublished
Master's Thesis, Central Department of Management, Tribhuvan University.
Paudel, N. (2015). Public Response to IPO in Nepal. Unpublished Master's Thesis,
Central Department of Tribhuvan University. .

Websites:
https://www.arthchakra.com
https://www.investopedia.com
 Questionnaire

Dear respondents

I will be very grateful if you kindly fill -up this questionnaire which is the
requirement of our bachelor level reports.
Respondent's Profile
E-mail address: ……………
Address: …………………...
Occupation: ………………...

Questions for the survey

1. In which sector IPOs do you think have more opportunity for investment to the
public?
a. Banking and Finance b. Insurance Company
c. Microfinance company d. Manufacturing and production
e. Hydropower
2. What do you see before investing?
a. Promoters Background b. Company performance
c. Market information
3. What difficulties you face after applying for IPOs?
a. Refund Problem b. Delay in crediting allotted shares
c. No clarity in allotment d. None of above
4. What is your opinion towards allocating 10 units of IPOs?
a. Should be continued b. Size of allotment should be increased
5. Don’t you think that allocating 10 units of IPOs has brought distortion in Nepalese
Share Market?
a. Yes, of course b. No, not at all
6. Do you think that Nepalese investors are influenced by rumors?
a. Very high b. High c. Moderate d. Low