‘Nepse rating will boost confidence’

Kathmandu, February 9:

Nepal Stock Exchange (Nepse) with a view to boost confidence of ‘shareholders and investors’ has rated the listed companies by evaluating their progress reports.

Mukunda Dhungel, general manager of the Stock Exchange speaking at the press meet today said that the ranking of listed companies is done on the basis of their issued capital, number of shareholders, profitability and timely submission of financial reports to the stock exchange.

“The rating was done as per the Nepal Stock Exchange Securities Listing by-laws 2053,” he said, adding that the listed companies that have Rs 20 million issue capital, 1000 shareholders, maintained profits for three consecutive years, and has submitted financial report to the Stock Exchange within six months of the completion of each fiscal year fall under category ‘A’.

Of the 127 total listed companies, 53 companies come under the category ‘A’, according to the guidelines of the Stock exchange,” said Dhungel. “The rating of the listed companies will be done every year.” This sort of ranking, as per the global trends, would help the shareholders to invest in the listed companies, he added.

As per the decision of the government in the recent finance ordinance, listed companies can get two per cent income tax rebate. However, Dhungel demanded that successful ‘A’ category companies should be given at least 10 per cent income tax rebate.

Of the total listed companies, 42 per cent are rated under category ‘A’. “Mostly finance companies fall under category ‘A’,” according to the Stock Exchange, “finance companies occupy 23.82 per cent, banking sector 9.44 per cent, insurance companies 7.28 per cent and others 0.7 per cent.”

Nabil Bank Ltd, Standard Chartered Bank (Nepal) Ltd, Nepal SBI Bank Ltd, Nepal Investment Bank Ltd, Everest Bank Ltd, Himalayan Bank, NIC Bank Ltd and Bank of Kathmandu Ltd are some of the banks that fall under the category ‘A’, while National Finance Ltd, Citizen Investment Fund, Universal Finance, Lumbini Finance, Siddhartha Finance, Union Finance, Premier Finance are some of the finance companies under the category A. Unilever Nepal Ltd has also been rated under ‘A’ category. Some of the insurance companies also fall under ‘A’ category.