KATHMANDU – The Nepal Stock Exchange (NEPSE) experienced extreme volatility on Monday, as a sharp market surge contrasted with the continued struggles of one of its newest listings, Reliance Spinning Mills Limited (RSML).
The broader market was characterized by overwhelming bullish sentiment, with the NEPSE index skyrocketing by 6%. This triggered the third and final functional circuit breaker of the session, leading to a permanent halt in trading for the remainder of the day. However, RSML failed to ride the wave, marking a notable departure from its recent performance.
RSML Ends Winning Streak
After hitting nine consecutive positive circuits since it began trading on February 16, Reliance Spinning Mills saw its first significant decline today. The stock dropped 10.20 points (1.49%), closing at Rs 675.30 per unit.
Market data revealed extremely thin liquidity for the scrip, with only 10 units changing hands during the entire session. The decline follows a close of Rs 685.50 on March 3.
The Long Climb to Breakeven
Despite the early run of positive circuits, RSML investors remain in the red. The company’s journey to the secondary market was hampered by a month-long listing delay due to procedural hurdles under the Securities Listing Bylaws, 2075.
The company’s IPO was conducted via the book-building method, a sophisticated pricing mechanism:
- Institutional Cut-off: Rs 912 per share.
- Public Issue Price: Rs 820.80 (offered at a 10% discount to the cut-off).
- Current Status: At the current closing price of Rs 675.30, the stock still needs to hit approximately 10 additional positive circuits just for investors to reach the breakeven point relative to their initial investment.
Massive Oversubscription vs. Market Reality
The current price struggle stands in stark contrast to the massive frenzy seen during the subscription phase in December 2025. The IPO was oversubscribed by more than 30 times, attracting over 532,888 applications from the general public.
Total applications for the public quota alone sought shares worth more than Rs 22 arba, with some estimates climbing as high as Rs 25 arba. The migrant worker quota was similarly competitive, with 35,102 applicants vying for a limited pool of 115,596 units.
Of RSML’s total paid-up capital of Rs 1.90 arba, roughly 10.14% (1.92 million shares) was offered to the public. Under SEBON guidelines, 40% of these units were reserved for institutional investors, while 60% were allocated to the general public and migrant workers.
As the broader market remains halted following today’s 6% surge, all eyes will be on whether RSML can decouple from its downward correction and begin the long climb back toward its IPO valuation when trading resumes.
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