N.R.N. Nepal Development Fund Ltd.

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Nepal Development Fund (NDF) is a collective investment scheme aimed to create opportunities for NRN investors, both small and large, to invest in projects that will improve the quality of life of every Nepali, generate employment and provide permanent income sources of income, thus allowing NRN to participate in national development through close collaboration with local stakeholders, governmental agencies, and other collaborating organizations, private or governmental.
On 4 April 2018, with the aim to facilitate NRN participation in an investing scheme and to bring capital, knowledge and technology to Nepal, a concept paper on the proposed investment plan for NRN Nepal Development Fund (NDF) was handed to the Ministry of Finance by NRN Association. The objective of this investment plan was to bring an investment of NPR 10 billion, which would then be invested in various projects and activities. A year later, a Memorandum of Understanding (MoU) was signed between NRNA and Government of Nepal at the Investment Summit held on 29-30 March 2019. The government reiterated their commitment to facilitate this investment plan by allowing NRNs to invest in capital market and utilize their collective skills, knowledge, and capital for the socio-economic development of Nepal. These were included in the budget of 2019. Following this, Nepal Rastra Bank, Nepal’s central bank, through its monetary policy announcement allowed NRNs to open deposit accounts for two years with repatriation facility.
A limited liability company, NDF has an authorized capital of NPR 10 billion as well as issued capital of NPR 10 billion. We are aiming to bring this capital into Nepal at the earliest. Of the total equity, 10% will come from NRN initial promoter, 5% from the Government of Nepal, and 85% from NRN through Initial Public Offering (IPO).
Apart from the fund itself, the NDF also has some criteria for investment as well as a procedure for project screening, investment management, and other strategies. In the initial phase, the areas that the investment will focus on are tourism, agriculture, manufacturing, information technology, urbanization, infrastructure, energy, finance, health, and education, among others. The fund intends to achieve its investment objective by investing primarily in equity of infrastructure companies. The fund defines infrastructure companies as those companies that derive major operating earnings from the ownership or operation of infrastructure assets, i.e., physical structures, networks, transportation, energy, and water and waste management.
Criteria for projects For investment, a project has to undergo the following phases before being finalized: deal sourcing and origination, screening, due diligence and valuation, approval, structuring and monitoring, management, and governance. The fund’s guiding principles for screening the projects are as follows: the project has to be technically sound and viable; the project must support the basic growth objectives of Government of Nepal; the project must be environment-friendly and socially sustainable; and it must have private sector control. Investment criteria will be based on feasibility of the projects. Infrastructure projects’ investment will be based on project financing concept. The fund will look upon the project cash flows for debt repayment to access the viability of the projects.