Nepal Stock Exchange (NEPSE) recorded share transactions worth over Rs 1.109 trillion in the first six months of the current fiscal year, with the hydropower sector leading the trading volume. The total shares traded during this period were nearly four times the amount recorded in the corresponding period of the last fiscal year.
According to Nepal Rastra Bank (NRB), a total of 2,569,354,470 units of shares were traded in the country’s secondary market between mid-July 2024 and mid-January 2025. In contrast, 808,654,440 units of shares worth over Rs 256.73 billion were traded in the same period of FY 2023/24.
The NEPSE index also experienced a significant rise, increasing by 355.55 points during the review period. The market index climbed from 2,240.41 points to 2,595.96 points. Meanwhile, the government collected Rs 9.82 billion in capital gains tax from share transactions in the first half of FY 2024/25.
Stockbrokers attribute the surge in share transactions to the central bank’s adoption of a more flexible monetary policy. The removal of the Rs 200 million cap on loans for margin trading in share securities by institutional investors led to a 20 percent increase in margin lending, reaching Rs 108 billion in the review period. Additionally, a decline in deposit interest rates and a slowdown in economic activities encouraged investors to inject more funds into the stock market.
The hydropower sector accounted for the largest share of total transactions. During this period, 969,735,000 units of shares from hydropower companies, worth over Rs 360.87 billion, were traded. This sector represented 32.5 percent of total traded volume, up from 24.4 percent in the first half of the previous fiscal year.
Government policies prioritizing hydropower development and infrastructure expansion have fueled investor interest, with expectations of increased electricity exports to India. Additionally, falling bank lending rates are expected to lower hydropower construction costs and enhance dividend prospects for investors.
Besides hydropower, investors were also drawn to the finance and commercial banking sectors. Finance companies recorded a turnover of Rs 131.95 billion, or 11.9 percent, while commercial banks saw transactions worth Rs 124.70 billion, or 11.2 percent.
Over the past year, between mid-January 2024 and mid-January 2025, investors realized capital gains of Rs 972 billion. Market capitalization surged from Rs 3.330 trillion to Rs 4.302 trillion, highlighting strong investor confidence and market expansion.
