Economy News The Rising Nepal (Daily)

Market braves ‘off-season,’ as index rises

BY A STAFF REPORTER

Kathmandu, April 28: In the wake of what capital market experts in Nepal love to call as ‘off-season’ on the trading floor, the stock market has continued its meagre growth last week too. In the reported week covering April 23 to April 27, the NEPSE index posted a rise of 2.40 points.

The NEPSE index that figured 365.58 on Monday rose to 367.98 on the last day (Friday).

The country’s share market had recorded a nominal rise of 0.18 points in the week preceding to this, i.e., April 16 to April 20 after consecutive falls for several weeks in the past with a few exceptions in between.

Two weeks ago, the NEPSE index had seen nearly six points fall which had redressed in its following week to post a meagre rise of 0.18 points one week back.

"The time covering a few months after Falgun (February-March) is normally viewed as ‘off-season’ in the secondary stock market in Nepal," says Parameshwor Lal Malla, a broker at the Nepal Stock Exchange Ltd. (NEPSE). Most of the listed companies conclude their annual general meetings (AGMs) by the months of Falgun-Chaitra, where they discuss and declare financial benefits to the shareholders in form of dividend (cash dividend, bonus and right shares) and other incentives, something that Nepali investors are most concerned with.

"The current rise—though nominal—should perk up spirit of investors, as it has come at a time when share value tend to tumble down," Malla adds.

Investors J. Dangol and A. M. Ranjit also agree. "The present trend is getting better for investment in the capital market," they said.

Market observers, despite the recent market rises, foresee the likelihood of only a 5-points up and down in the overall NEPSE index in the days to come until Ashad, the end of the fiscal year in the country.

Sector-wise, the NEPSE index of commercial banking sector has improved as it rose from 404.49 to 408.89 which contributed a lot to perk up the overall index. Commercial banks’ shares recorded a whopping 51.46 per cent share in the total transaction on the floor in the reported week also.

The indices of the manufacturing and processing, and trading sector companies remained constant at 335.48 and 117.18 respectively, while hotel and tourism, insurance and finance, and the other sector showed a slight decline. Their closings were 299.10, 332.92 and 205.74 respectively.

During the reported week ending April 28, altogether 68,435 units of shares belonging to 45 companies (out of 55 listed for transaction) were traded on the NEPSE floor for Rs. 26.205 million through 646 transactions, according to reports received from Nepal Stock Exchange Ltd.

In the week before it, 40,861 units of shares belonging to 38 companies were traded for Rs. 32 million through 697 transactions, according to reports of the Nepal Stock Exchange Ltd.

Although the number of share units transacted has increased, the market has decreased in both transaction share value and number of transactions. Two weeks before to it, 118,694 units of shares worth Rs. 40.9 million had been traded.

So far as the group-wise trading of shares was concerned, as in the past weeks, the commercial banks group has a lead in the market with 51.46 per cent (Rs. 13.44 million) of the total market transaction value.

A remarkable surge has been recorded by the finance sector transactions as it went neck to neck with banks by constituting 42.82 per cent (Rs. 11.185 million) in the total. The transaction value of insurance sector secured 2.13 per cent. The shares of the remaining sectors had insignificant mites.

Measured by the number of transactions, the Nepal Industrial and Commercial (NIC) Bank Ltd., took the lead with its 84 transactions in the week. In terms of the number of units of shares traded, Nepal Share Markets Ltd. topped the list with 20,020 units. The shares of Goodwill Finance Co. Ltd. saw the highest total rupees value of share transaction as they amounted to Rs. 5.328 million.

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