Business News (Businessage Monthly)

Nepal-Scandinavia Chamber

Nepal-Scandinavia Chamber of Commerce and Industry (NSCCI) has been recently set up with Yadav Prasad Pant as its chairman.

With Mohan Gopal Khetan as its vice-chairman, NSCCI has Surya Ram Shrestha, Giridhari Sharma and Uddhav Mohan Ranjit as its general secretary, secretary and treasurer respectively.

Similarly, Dr. Jayahari Raj Pandey, Mana Raj Shrestha, Shailendra Shamsher JBR and Surya Prakash Shrestha are the members of the chamber.

Powerloom Pashmina Prevail

The exports of handloom pashmina have declined heavily after powerloom pashmina have begun placing ‘handmade pashmina tags’, says Handloom Pashmina Entrepreneurs Association.

Voicing protest against this trend, the association has demanded the government to make a clear-cut policy to monitor such malpractice in pashmina exports.

"We are not against powerlooms but exporting pashmina with a fake tag is what we are opposing", said Damodar Khadka at a press conference. This trend has not only cheated the customers but has also reduced employment, he said.

Despite the difference in quality in handloom and powerloom pashmina, the machine made pashmina has captured the international market, he said. The main reason, according to Khadka, is that the buyers do not know the main difference between the two products.

"Handmade pashmina has softness whereas powerloom pashmina does not have softness", he informed. Powerloom pashmina manufacturers are very much optimistic about the future of then business. Considering this and to sustain the present boom in pashmina industry, Momento Apparels (P) Ltd. of Nepal and Huhhot Xin Chao Art Co. of China have set up Emperor’s Gold Mount, a joint venture pashmina industry in Bhadrapur with capacity to produce some 600,000 pieces of pashmina per year.

Set up at a total investment of US$ 3 million, it expects to provide employment to over 500 locals of whom 70 percent will be women, company sources say.

This shows that pashmina entrepreneurs are hopeful that the business will not meet the fate of the Nepali carpet industry.

And with a view to ensure the longevity of the pashmina industry, entrepreneurs are also diversifying their products into pashmina trousers, gowns, bags etc., state pashmina entrepreneurs.

Premier Finance to Give 12% Dividend

The third AGM of Premier Finance Company Ltd. has approved the board of directors’ decision to provide its shareholders 12 percent dividend, says a press release issued by the company.

Premier Finance recorded, in comparison to the previous year, a 198 percent profit increase in the fiscal year 1998/99, according to the release. The release also reveals that the company made a deposit collection amounting to Rs. 61.9 million by the close of the fiscal year. The press note further states that of the total deposit, Rs. 41.2 million have been invested in different areas.

At the AGM, chairman of the company Bharat Narsingh Joshi informed that the number of depositors had gone up to 577 and the company has loaned to some 308 clients.

Soaltee Increases Dividend Pay out

Despite a marginal increase in its revenue, Soaltee Hotel Ltd. increased dividend pay out to its shareholders out of the profits of the fiscal year that ended on July 16, 1999. The recently concluded 25th AGM of the company approved the Board of Directors’ proposal to pay 50% dividend to the shareholders. In the previous year, the company had distributed 40% dividend.

Presenting the report of the Board of Directors in the AGM, chairman of the company Prabhakar SJB Rana attributed the sluggish revenue growth to discontinuation of airport and restaurant business since October 1, 1998, and lower average room rate (ARR) compared to the previous year. During 1997/98, the hotel had 61.19% occupancy with ARR Rs. 4,217. While the occupancy went up to 62.74% in 1998/99, the ARR dropped to Rs. 4,011, according to the report.

Financial of Soaltee Hotel Ltd.

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However, the hotel managed to record an 11.03% growth in profit after tax by gaining 46% reduction in interest cost and lower depreciation. The debt to equity ratio of the company has gone down to 0.21:1 in 1998-99 from 0.54:1 in 1996-97.

Fifth National Industrial Exhibition

The fifth National Industrial Exhibition held in Butwal concluded doing a business of Rs. 50 million.

Speaking at the concluding ceremony of the 11-day-exhibition jointly organized by Rupendehi Industry Association and Swiss Contact SIPP, Minister for Commerce and Industry, Ram Krishna Tamrakar highlighted the need for exposure of Nepali industries into the international market.

On the occasion, Butwal Steel Furniture and Uday Shree Tea Industries were adjudged as the best exhibitors receiving first and second prizes respectively, while Shangrila Shoes industries received the third prize.

More Tourists by Air

Despite high expectation that VNY’98 would boost tourism industry the year 1999 saw a marginal growth of 5.84% in tourist arrivals by air despite increase in air seats, according to reports quoting the Immigration sources.

The figure revealed by the Immigration office, TIA show 421,188 tourist arrivals by air, which is 123,180 more then 1998.

Tourists Arrivals by Air in 1999
Country	Number of Tourists	Shshareare (%)
India	140,363	33.39%
USA	35,582	8.45%
Japan	32,330	7.68%
UK	30,783	7.31%
Germany	22,687	5.39%
France	21,303	5.06%
Netherlands	11,988	2.85%
Italy	10,957	2.60%
Australia	9,630	2.29%
Spain	8,155	1.94%
Switzerland	7,212	1.71%

According to the data, the number of tourist arrivals by air was 398008 in 1998 and 371145 in 1997.
Indian tourists arrival declined to 140630 in 1999, which was 142666 in 1998, the TIA data showed.

Merger of Auditors

Auditors never tire of advertising their clients to behave as a true corporate entity, whereas the auditing firms themselves are either proprietorships or partnerships, not a body corporate. In this background, two of Nepal’s most prestigious auditing firms have merged together with a promise to develop their new firm under a corporate culture.


The merger between KB Chitracar & Co. and MK Sharma and Co. took place to form Citracar Sharma & Co. (CSC) after two international auditing firms – Pricewaterhouse Co. and Coopers Lybrand Co. merged together to form Pricewaterhouse Coopers (PwC) in 1998. Earlier, KB Chitracar & Co., established in 1970, was associated with Coopers and Lybrand Co. since 1990, whereas MK Sharma & Co. had an informal association with Pricewaterhouse and Co., according to MK Sharma, now a Partner in CSC

The newly formed CSC is now appointed Associated Firm of PwC in Nepal. PwC is one of the big 5 firms globally with an annual revenue of US$ 18-20 billion, according to Komal Chitracar, Senior Partner of CSC. And to be associated with such a firm is to develop capability in providing quality professional service and to expand the size by bringing in fresh professionals, informs Chitracar.

"Getting exposure internationally and to provide instant quality services, covering the whole range of services is our objective in joining hands with PwC," states Chitracar.

Getting formally associated with an international firm can be of an immense help to undertake any type of services, views Sharma.

CSC’s list of present clients includes big companies like RNAC, Nepal Electricity Authority, Agriculture Development Bank, Nepal Tele-Communication Corporation, Nepal Indo-Suez Bank, Bank of Kathmandu, Beema Sansthan and some insurance companies. CSC has four professionals working at present centralizing its service in auditing, tax advisory service, accounting financial advices, consultancy, company law, financial analysis and bank dealings. PwC International, based in London, is owned by PwC trust based in New York.