The regulatory leaders thus have pointed out the need of mandatory provisions in corporate laws to transform the larger private companies into public ones.

Dr. Yubaraj Khatiwada, governor of the Nepal Rastra Bank, central bank is of the view that an amendment is required in existing Company Act 2006 to exert pressure on the large private companies to issue their share for the public.

''There must be a provision for compulsory conversion of large private firms having capital more than a certain limit,'' he told.

Likewise, former vice chairperson of National Planning Commission, Deependra Bahadur Kshetry said that if large companies are listed in the capital market, they will have to maintain transparency and corporate culture.

In the meantime, entering into the capital market will ease such companies in generating capital for business expansion, Kshetry opined.

More than two dozens of large industrial houses will be converted into public companies if such provision is implemented.

Nepal's first billionaire Binod Chaudhary led Chaudhary Group is still functioning as merely a private firm so far. Likewise other several big industrial and trading houses owned by larger groups are working as private companies in Nepal.

The private companies are not required to publicize their balance sheet and other business related information.

Currently, the banking and non-banking financial institutions are only the transparent sector listed in the stock market which covers more than 85 percent segment of the market.

Baburam Shrestha, the chairperson of Security Board of Nepal, underscored the need of attracting the real sector companies into the capital market.

''While we are trying to facilitate the real sector companies to bring them into the capital market, appropriate legal framework will indeed accelerate the process if posited,'' he said.

© Corporate News Syndicate