The government plans to allow hydropower companies with projects under construction to issue initial public offerings (IPOs) only after completing at least 50 percent of the physical work.

The provision is included in the draft of an ordinance to amend certain Nepal laws relating to investment and infrastructure, which the government is preparing to issue.

The draft proposes amendments to several laws, including the Securities Act 2006.

Under the proposed provision, a company developing a hydropower project would be eligible to apply for a public share offering once the project has achieved at least 50 percent of its certified physical progress and meets other requirements for a public issuance. The application cannot be rejected solely because the project has yet to begin commercial production.

In other words, hydropower companies would not need to have started generating electricity to issue shares, but they would have to demonstrate that construction is at least halfway complete.

The proposal comes after the Securities Board of Nepal, in a draft of its Guidelines on General Eligibility for Public Issuance, 2026, suggested that companies must have been in continuous business operation before they could make a public offering.

Hydropower promoters had objected to the proposed requirement, arguing that it would prevent companies from raising funds through IPOs at the stage when they need capital most.

The draft ordinance now sets a separate threshold for hydropower companies seeking to issue shares while their projects are still under construction.