Kathmandu, January 19:

Government’s decision to float the biggest ever volume of shares of 15 million-unit of Nepal

Telecom (NT) from January 23 and central bank’s banning of margin lending have this week increased selling pressure at the Nepse floor pulling the index down by 76.07 points to 905.36 points from the last week’s closing of 981.43 points.

The major market leaders like Hydropower, Commercial banks, Development banks and Insurance groups ended into the negative territory with 99.09 points, 87.39 points, 83.73 points and 56.65 points drop from Sunday, the first day of transaction.

Nepse closed at 976.07 points on Sunday from last week’s closing of 981.43 points. Similarly, it plunged by 17.16 points on Monday to 958.91 points. On Tuesday, Wednesday and Thursday, it dropped by more than 25 points halting the trading on each day to close at 905.36 points on Thursday, the last day of the trading at the floor.

However, the total transaction recorded a little over Rs 310 million as against last week’s Rs 1.41 billion. Among the total transaction, companies under the ‘A’ category held only 44.22 per cent.

In terms of monetary value, National Hydropower, Nepal SBI Bank, Machhapuchhre Bank, Nepal Bangladesh Bank and Standard Chartered Bank are the gainers this week.

National Hydropower Company topped the chart in terms of monetary value and number of shares traded. However, in terms of number of transaction, Gurkha Development Bank topped the chart with 374 transactions. Altogether, 58 listed companies’ shares were traded at the Nepse floor this week, where the government bonds and debenture were not traded.

Meanwhile, Securities Board of Nepal (Sebon) started investors awareness campaign from this week. Investors’ awareness is very important for the development of stable and sustained capital market. But at the same time Sebon needs to come hard on the listed companies that are not following the regulation.

Agreed Dr Chiranjivi Nepal, chairman of sebon, the regulatory authority of capital market. “After this week-long investors’ awareness programme, Sebon will concentrate on the listed companies also,” he said adding that the companies must follow the regulation.

“Chilime Hydropower tried to distribute the cash dividend without floating the shares

to public but we wrote them not to do so before going public,” Nepal added.

“Some of the companies are not holding annual general meeting on time, others are not holding AGM at all,” said one investor, adding that Sebon must take action against them.

“NT, while floating the share to public, has gone against the Company Act, IPO Regulation-2057 and Privatisation Act by publishing Call Notice without approval date of company

registrar and Sebon, and place to register the complaints,” Rabindra Bhattarai, a capital market analyst said.

Similarly, it has not published the prospectus, which is mandatory under the Company Act-2062, clause 23 (7). “It has also not published the three years’ projection that is mandatory,” Bhattarai added.

NT and Chilime are only tip of the iceberg, there are companies — except the financial institutions — which till date the public do not know of their existence. “Once they float shares

to public and collect people’s money they vanish like they were never there,” Suman Parajuli, a Nepal Telecom employee said, adding that lack of effective monitoring has made it easy for every Tom Dick and Harry go collect money legally from the people and run away.