Nepal’s stock market capitalization has reached a record high of Rs. 4.826 trillion as of Monday, marking the highest level ever recorded. This surge follows the introduction of a stock market-friendly monetary policy by Nepal Rastra Bank (NRB), which comes amid signs of economic recovery. The previous highest capitalization was Rs. 4.799 trillion.
Tulsi Ram Dhakal, President of Nepal Investor Forum, stated that positive policy reforms and declining interest rates—dropping from around 14–15% to approximately 8%—have driven this growth. He added that increased investor attraction, the entry of new companies, and overall market expansion have contributed to the rise in capitalization.
Dhakal also highlighted that investor confidence has strengthened due to the improving economic outlook following years of stagnation, particularly during the COVID-19 crisis. He said macroeconomic indicators have improved, encouraging more investments in the stock market.
On Monday, the NEPSE index rose by 21 points, reaching 2,892. Out of the traded stocks, prices of 153 companies increased while 96 decreased. The monetary policy introduced by Governor Dr. Bishwanath Paudel is seen as supportive of the stock market.
A key provision in the new monetary policy allows individual investors to obtain margin loans of up to Rs. 250 million (25 crore) by pledging shares as collateral—up from the previous limit of Rs. 150 million. This has boosted investor morale. Additionally, lower interest rates and increased banking sector liquidity have positively affected the market.
With cheaper borrowing costs, more investors are using loans to invest in stocks. In the current fiscal year 2081/82, the highest market capitalization was recorded on Falgun 18 (around early March), while the lowest was on Asar 26 (early July), at Rs. 3.45 trillion. The overall improvement in the economy is believed to have directly impacted market performance, as stock markets often respond first to economic growth.
Despite the rise in NEPSE on Monday, the total turnover declined compared to the previous trading day. On Sunday, shares worth Rs. 21.5 billion were traded, while Monday’s transaction volume dropped to Rs. 16.33 billion, with over 3.56 million shares traded in 138,828 transactions across 311 stocks.
All 13 sub-indices posted gains on Monday. The microfinance sub-index rose the most—by 1.93%. The indices of development banks, non-life insurance, and others also increased by more than 1%. Shares of three companies—Three Star Hydropower, Trade Tower, and Sanvi Energy—hit the upper circuit limit.
Unnati Sahakarya Microfinance saw its share price surge by around 9.5%. In terms of transaction volume, Nepal Reinsurance Company topped the list, with shares worth Rs. 756.6 million traded. Himalayan Reinsurance also saw transactions exceed Rs. 750 million.
Market gains have also been attributed to improvements in economic growth, rising revenue, and increased import-export activity. According to Nepal Rastra Bank, the economy is gradually returning to a positive trajectory. Inflation remains within acceptable limits. Remittance inflows, tourism recovery, and rising exports have strengthened foreign exchange reserves. Even previously contracted economic sectors have begun expanding, with the economic growth rate improving compared to the previous year.
