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Nepse Yearly Review

  2 min 35 sec to read

 
 
--By Rashesh Vaidya
 
The stock market soared during the FY 2012- 13 closing at 518.27, up 128.55 points, or 32.99 percent. 
 
The benchmark index had reached the highest on February 17, 2013 at 555.93 points, while the lowest record for the fiscal year was on July 16, 2012 (the opening day) at 384.92 points. The index crossed 500 points on November 20, 2012 closing at 501.52 points. This was the first time the benchmark index had crossed the 500-point mark in over two-and-half years. 
 
Compared to the turnover of Rs 10,162 billion of preceding fiscal year 2011-12, this year the turnover rose by a hefty 98.12% to stand at Rs 20,133 billion. Similarly, the listing and transactions of new commercial banks like Civil Bank and Commerce and Trust Bank and other companies, as well as relisting and transaction of Nepal Bank Limited helped market capitalization make a huge leap of 39.71% to stand at Rs 514,492.13 million on the close compared to Rs 368,262.13 million in the last fiscal. 
 
At the beginning of the last fiscal year, the one-third budget brought through ordinance by the then government failed to create any positive impact in the market. But the Nepal Rastra Bank’s approval to banks and financial institutions margin lending and loan against purchase receipt of shares eased liquidity in the market helping the share prices to go up. 
 
Likewise, introduction of mutual fund guideline by the Securities Board of Nepal (SEBON) paved the way for the launching of Siddhartha Growth Mutual Fund-I worth Rs 500 million and Nabil Balanced Fund-I worth Rs 750 million which created a positive impact in the market. 
On the other hand, delay in the implementation of Central Depository System (CDS) has failed to live up to the high expectations that the investors had. 
 
The consensus among political parties to form a government led by Chief Justice Khil Raj Regmi brought new rhythm in the market. The announcement resulted in the third highest turnover worth Rs 238 million on February 12, 2013, forcing a 5% circuit breaker on February 17, 2013, after nine months gap at Nepse floor. The Nepse index that day touched the highest point of the year closing at 545.72 points. 
 
Again, the provision allowing offloading of promoters share directly through secondary market, technical glitches in the Nepse website and broker terminals and increase in the number of broker suspensions for their failure to pay the dues affected the market negatively causing a drop on the Nepse index to 490.53 points. 
Meanwhile, listing and transaction of merged companies like Global IME Bank, NIC Asia Bank and others also played a part in turning the market on. 
 
Appointment of a new General Manager at Nepse at the end of the fiscal year has created a positive vibe among investors, raising hopes that long stalled projects and programmes would now be implemented.
 

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