During the review period of 20 September to 22 October 2018, the Nepal Stock Exchange (NEPSE) index went down by 14.27 points (-1.13%) and closed at 1,244.54 points. Despite fall in NEPSE index, market witnessed a significant jump in the trading volume during the period with single day trading turnover of over NPR 1 billion after five months. Overall trading volume during the review period surged by 10% and the total market turnover stood at NPR 8.24 billion.
During the review period, eight sub-indices landed in the red zone while three sub-indices landed in the green zone.
The Manufacturing & Processing sub-index (-6.91%) led the pack of losers with the decrease in share value of Uniliver Nepal (-NPR 3,014) and Bottlers Nepal (Terai) Limited (-NPR 250). Similarly, Non-Life Insurance sub-index (-6.15%) was second in line with the slump in share value of Rastriya Beema Company (-NPR 455), Premier Insurance (-NPR 87) and Prudential Insurance (-NPR 75). Likewise, Hydropower sub-index (-5.25%) followed suit with decrease in share value of Sanima Mai Hydropower (-NPR 63), Api Power (-NPR 37) and Arun Kabeli Power (-NPR 36). Microfinance sub-index (-4.69%) went down with the decrease in the share value of Swarojgar Microfinance (-NPR 185), Suryodaya Microfinance (-NPR 120) and Swadeshi Microfinance (-NPR 118). This was followed by Life Insurance sub-index (-3.11%); top loser in this sub-index were Gurans Life (-NPR 55), National Life (-NPR 43) and Prime Life (-NPR 42). Likewise, other sub-index (-0.96%) shed value with the decrease in the share value of Citizen Investment Trust (-NPR 66). Similarly, Development Bank sub-index (-0.89%) went down with the fall in share value of Shine Resunga Development Bank (-NPR 59) and Purnima Development Bank (-NPR 17). Furthermore, Hotels sub-index (-0.31%) followed suit with decrease in share value of Oriental Hotel (-NPR 89).
The Trading sub-index (+9.57%) led the pack of gainers with the increase in share value of Bishal Bazar Company (+NPR 130). Similarly, Commercial Bank sub-index (+0.71%) was second in line with the surge in share value of NIC Asia (+NPR 41), Prabhu Bank (+NPR 33) and Kumari Bank (+NPR 16). Likewise, Finance sub-index (+0.53%) followed the suit with increase in share value of Pokhara Finance (+NPR 10) and Central Finance (+NPR 6).
News & Highlights
Nepal Stock Exchange (NEPSE) has suspended the share transaction of 48 firms as they have failed to make timely payments of the annual renewal fees. Most of the companies whose transactions have been halted are hydropower firms, microfinance companies, development banks and hotels. Likewise, NEPSE has failed to launch the fully automated electronic trading system of shares in the secondary market. It had planned to launch the system on 17 July but postponed it to 10 September. However, NEPSE failed to do so on the revised date too.
In the public issue front, Aankhu Khola Hydropower Company Limited (AANKHU) issued Initial Public Offering (IPO) worth NPR 200 million. The issue was assigned IPO Grade 5 by ICRA Nepal indicating poor fundamentals. Meanwhile, SEBON has approved IPO worth NPR 1.44 billion of Madhya Bhotekoshi Jalavidyut Co. Ltd for employees having membership of employee Provident Fund, employees of Promoter shareholding companies and employees of lending institutions. The issue has been assigned IPO Grade 4+ Care Ratings Nepal indicating below average fundamentals. Also, SEBON has approved IPO worth NPR 0.99 million of Himalaya Urja Bikas Company Ltd. for local people of the project affected areas. The issue has been assigned IPO Grade 4 by ICRA Nepal indicating below average fundamentals.
Outlook
The liquidity position in the banking sector tends to get tight post Dashain, and is further impacted by the second largest festival-Tihar which is around the corner. The tightening of liquidity in the banking system is going to directly impact the volume at the secondary market. Further, investors are likely to take “wait and see” position till the end of festivities as most of the listed companies will start to announce and distribute dividends from the earning of FY 2017/18 post-Tihar only.
This is an analysis from beed management pvt. ltd. No expressed or implied warrant is made for usefulness or completeness of this information and no liability will be accepted for consequences of actions taken on the basis of this analysis.
This is an analysis from beed management pvt. ltd. No expressed or implied warrant is made for usefulness or completeness of this information and no liability will be accepted for consequences of actions taken on the basis of this analysis.
