Share market of the week: Panicked investors excited
Last week, the stock market has seen a 'shine'. On one day of the week, the Nepse index decreased by a small number, but increased on most days. The Nepse index has risen in the last two consecutive weeks, setting new records time and again.
On Sunday, the first day of the week, the Nepse index reached 3,059 points and crossed the high point. The Nepse index, which had declined by a small number the next day, reached a new record of 3,080 on Tuesday. The process of setting a new record continued on Wednesday.
Active investor Nayan Bastola says that the enthusiasm for share investors has increased recently. Although the fluctuations in the market should be taken as normal, some time ago, investors were alarmed when the market fell a lot. But now there is renewed enthusiasm among investors, she says.
On Wednesday, the Nepse index reached a historic high of 3,095 points. This is the highest point so far. On Thursday, the Nepse index closed at 3,080 points. Enthusiasm was seen in the share market till mid-June last year. Although the overall market growth was good, the board conducted a special study on the market, saying that the unnatural prices of some companies had gone up.
According to the preliminary report of the study, the share price of 51 companies has increased unnaturally. The Nepse index, which measures share turnover in the last week of June, had set a historical record by reaching above 3,000. With a daily turnover of Rs 20 billion along with the Nepse index, the share turnover as well as the number of transactions was recorded.
The board named 51 companies as risky for investment, but later the market situation changed. The board had issued such a statement on June 20. The next day, the Nepse index dropped by 51 points.
The share prices of not only risky but also well-known companies have been declining since then. The impact of the board's announcement did not last long. Political change at the policy-making level has a big impact. Last July, the CPN-UML-led government was changed to a Nepali Congress-led government. Maoist leader Janardan Sharma has been given the charge of finance in the capital market taluk ministry.
After the change of government in late July, the stock market started to look sluggish again. Even though the Nepse index dropped to close to 2,800, it is now approaching 3,100 again. Although there is not much enthusiasm in the transaction amount, it is good on average. Shares worth around Rs 11 billion were traded last Thursday.
All green except banking and mutual funds
The Nepse index has increased by 2.06 percent in the last one year. Of the 12 group sub-indices traded on the Nepal Stock Exchange, two have declined. While the two sub-indices, banking and mutual funds, declined by 1.16 per cent and 2.82 per cent, all other group sub-indices rose.
The hotel and tourism group has seen the biggest increase. The group's sub-index rose 7.86 percent. The hydropower group grew by 6.62 percent, followed by the finance group, which grew by 5.89 percent.
Similarly, manufacturing group grew by 56.88 percent, investment by 4.51 percent, life insurance by 4.10 percent, non-life insurance by 4 percent, others by 3.01 percent, development banks by 2.32 percent, microfinance by 1.80 percent and trade group by 1.77 percent.
United Modi first in business
A lot of shares of United Modi Hydropower have been traded during the week. Shares of the company worth Rs 1.46 billion have been traded. In terms of share turnover, National Hydro is second and NIC Asia Bank is third.
Shares of National Hydro have been traded at Rs 1.46 billion, while shares of NIC Asia have been traded at Rs 1.39 billion.
Prices rose more than 30 percent
Investors in Reedy Hydropower Development Company have earned more than 30 percent this year. The share price of Reedy, which tops the list of highest earning companies, has gone up from Rs 560 per share to Rs 729 by the end of the year. Reddy's share price has risen 30.18 percent in a year.
Investors of United Modi Hydropower Company have earned the second position. The company's share price has risen about 27 percent from Rs 494 to Rs 627 a year. Third, the share price of Nepal Hydro Developers Company has risen significantly.