Kathmandu — This week, there has been significant investor interest in the shares of hydropower companies. The fact that the hydropower sub-group accounted for about 30 percent of the total stock market transactions this week confirms this. Since Thursday was a public holiday, the stock market was open for only four days this week.
During this period, shares worth approximately 34 billion rupees were traded. Of that total, 10 billion 158.7 million rupees were attributed to hydropower companies, accounting for 30.11 percent of the overall turnover.
During this period, shares worth approximately 34 billion rupees were traded. Of this, shares worth 10 billion 15 crore 87 lakh rupees were traded in hydropower companies.
This accounts for 30.11 percent of the total transactions. When combined, the share of banks, financial institutions, and insurance in the weekly total transactions comes to around 38.5 percent. However, in the Nepal Stock Exchange (NEPSE), the shares of companies in these sectors are listed under separate sub-groups, including banking, development banks, finance companies, microfinance, life insurance, and non-life insurance.
When the transaction amounts of all these sub-groups are added to the total transactions of the week, they account for 38.35 percent. This is only about 8.5 percentage points higher than the share of hydropower. Experts suggest that this indicates a decline in the dominance of the financial and insurance sectors in the stock market in recent years, while the hydropower sector has been growing.
This week, the NEPSE dropped for three days (Sunday, Monday, and Tuesday) and increased on one day (Wednesday). The NEPSE, which dropped by 99.22 points over three days, rose by 17.28 points on Wednesday. The NEPSE, which closed at 2,818.43 points last Thursday, dropped to 2,736.48 points on Wednesday. During this period, all indicators, including the NEPSE index, transaction amounts, and the number of shares bought and sold, have decreased. Most sub-group indicators in the weekly transactions are negative. This means that the investors’ assets have decreased.
In this week’s total stock market transactions, the share of the investment sub-group is 10.24 percent, while others account for 16.66 percent. Companies in the production and processing group hold a 3.54 percent share, while the hotel and tourism sector holds only 0.90 percent.
Currently, the number of companies listed on the Nepal Stock Exchange has reached 268. Among the listed companies, 130 are banks, financial institutions, and insurance companies, 91 are hydropower companies, 22 are in production and processing, 7 are hotels, 7 are investment companies, 4 are commercial institutions, and 7 belong to other sectors. As of Feb- 2024, the number of listed companies was 271.
In terms of the size of the stock market (total market capitalization), financial institutions account for 53.3 percent, while hydropower holds a 16.7 percent share. The total market capitalization is calculated by multiplying the number of listed shares by the share price of the same day. The continuous decrease in the share of financial institutions and insurance, along with the increase in the share of hydropower, also confirms the growing dominance of hydropower in the market.
As of February 2023, the share of the financial and insurance sectors in total market capitalization was 65.8 percent, while hydropower’s share was only 12.9 percent. By January 2024, the share of the financial and insurance sectors decreased to 57.3 percent, while hydropower’s share increased to 15.9 percent. Currently, according to NEPSE, the share of the investment sector in total market capitalization is 7.6 percent, the share of commercial institutions is 5.4 percent, the share of the production and processing industry is 5.3 percent, the share of hotels is 2.7 percent, and other sectors account for 9 percent.
As of January-February 2025, the paid-up value of 8.67 billion shares listed on the exchange is 854.91 billion rupees. In the first seven months of the current fiscal year, NEPSE has reported the listing of additional securities worth a total of 1.66 billion rupees, including 742 million rupees in bonus shares, 391 million rupees in rights shares, 125 million rupees in collective investment funds, 7.5 million rupees in common shares, 44.5 million rupees in further share issuance (FPO), and 396 million rupees in others.
During this period, the Securities Board of Nepal granted approval for the public issuance of securities worth a total of 21.67 billion rupees, including 10.2 billion rupees in collective investment funds, 9.3 billion rupees in rights shares, 1.32 billion rupees in debentures, and 850 million rupees in common shares, as reported by NEPSE.
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