On Sunday, July 6, 2025 (Asar 22, 2082), the Nepal Stock Exchange (NEPSE) showed a mixed performance. While the benchmark index recorded a marginal uptick, overall market sentiment remained uncertain due to liquidity tightening by the central bank, regulatory actions, corporate movements, and anticipation surrounding the upcoming monetary policy.
1. Market Index Performance: Mild Gain, No Clear Trend Yet
The NEPSE index recorded a slight increase of 2.40 points, closing at 2,706.36. Alternate sources reported a 7.75-point gain, pushing the index to 2,707.72, indicating minor discrepancies in reporting.
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The Banking sector rose by 0.11%.
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The Finance sector gained 2.16%, while
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The “Others” category saw the highest rise of 3.06%.
On the downside, the Development Bank sector dropped 1.49%, and the Life Insurance sector declined 1.30%, signaling continued volatility.
2. Trading Volume and Turnover: Strong Activity but Diverging Trends
On Sunday, NEPSE recorded a total trade of 271 million shares, with turnover exceeding NPR 9.71 billion. However, some sources pegged the figure slightly lower, at around NPR 9.50 billion.
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Shares of 318 companies were traded.
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Nepal Reinsurance Company led with a turnover of NPR 494 million.
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Laxmi Sunrise Bank’s promoter shares followed with NPR 378 million in trades.
3. Top Gainers and Losers: From Circuits to Debenture Drops
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Nepal Finance Ltd. hit a 10% upper circuit, becoming the day’s highest gainer.
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Guardian Micro Insurance posted a 7.35% gain.
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On the losing end, Goodwill Finance Debenture holders suffered an 8.87% loss.
Overall, 87 companies saw price increases, while 162 declined, indicating a fragmented market.
4. Market Movers: Bonus Listings, Liquidity Absorption & IPO Updates
Bonus Shares Listed
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Prabhu Mahalaxmi Life Insurance listed 3.78 million bonus shares, part of its 8% bonus distribution for FY 2079/80.
Liquidity Management
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The Nepal Rastra Bank (NRB) moved to absorb NPR 45 billion from the market via a 42-day repo auction. This is the seventh such operation in Asar and reflects high liquidity in the banking system.
IPOs & Rights Offerings
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Last day to apply for Bikash Hydropower Ltd.’s IPO.
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People’s Power Ltd. opened its 1:0.5 rights issue.
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Global IME Samunnat Mutual Fund-2 also opened for subscription.
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Mabilung Energy Ltd. launched an IPO for project-affected locals and overseas workers.
5. Regulatory Actions: Broker Suspension
NEPSE suspended Sipla Securities (Broker No. 20) for three days on recommendations from CDS & Clearing Ltd., citing settlement delays. This is part of a continued regulatory effort to enforce compliance and operational discipline.
6. Monetary Policy Anticipation: Investment Mood in a Holding Pattern
The Nepal Rastra Bank is in the final phase of preparing the Monetary Policy for FY 2082/83.
Economic Backdrop:
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Banks are sitting on over NPR 520 billion in loanable funds.
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Governor Dr. Baikuntha Paudel has called this a golden investment opportunity, citing high deposits and strong foreign reserves.
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Interest rates are historically low: loan rates at 8.55%, savings rates at 4.60%.
Policy Focus Areas:
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The monetary policy will support government-led fiscal programs.
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Priority sectors include agriculture, energy, and industry.
Expert Views:
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Dr. Samir Khatiwada argues that fiscal and monetary policies don’t always need perfect coordination and emphasizes the NRB’s core role in controlling inflation.
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Governor Paudel acknowledged high non-performing loans (NPLs) in priority sectors, with the overall NPL rate at 5.24% this fiscal year.
Private Sector Expectations:
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Businesses are hoping for accommodative measures to revive lending and support distressed sectors.
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The Nepal Bankers’ Association has called for the creation of an Asset Management Company to tackle rising NPLs.
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Economist Dr. Menuka Karki emphasized that policies should be based on sectoral productivity and employment impact.
7. Foreign Investment Reform: Greenlight for IT Reinvestment Abroad
The NRB introduced a new legal framework allowing IT companies to reinvest abroad, provided they’ve earned foreign income from exports over the past three years.
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They can invest up to 25% of annual export earnings abroad and repatriate 50% of profits back to Nepal.
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This is aimed at supporting the growing digital service export ecosystem.
8. Foreign Exchange Reserves: All-Time High
Nepal’s foreign exchange reserves reached a record NPR 2.426 trillion (US$17.63 billion) as of mid-Baisakh FY 2081/82.
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Key drivers: strong remittance inflows, declining imports, and tight FX expenditure controls by the NRB.
Conclusion:
The NEPSE market remains in a wait-and-watch mode. While positive movements in select sectors and high turnover provide optimism, investor confidence hinges on NRB’s upcoming monetary policy and its ability to balance liquidity management with growth stimulation. Regulatory enforcement and macroeconomic reforms—especially in digital investment and NPL reduction—are setting the stage for a potentially transformative period in Nepal’s capital markets.