Nepse in Bullish Run but Transaction Amount Dropped, Impact of BASEL-III News

Rashesh Vaidya

Kathmandu, Dec 15 –  Nepse index increased by 11.42 points during previous week. It had closed 702.20 on Sunday, 8^thDecember (the first trading day of the week) and reached 713.62 at the close of Thursday, 12^th November (the last trading day of the week). But the transaction amount is 17.31 percent lesser than that of earlier week. The total number of scrips traded was 6,415,050 which is 317744 scrips lesser than that of earlier week.

The market floor was open for five days.

Days	Sectors									Nepse Index
	Com. Banks	Mfg. & Pro.	Hotel	Others	Hydro	Trading	Insu.	Finance	Dev. Banks
Sun	679.13	934.54	1124.01	768.35	1664.17	170.86	1954.33	405.41	405.41	702.20
Mon	688.86	934.54	1091.02	755.43	1656.98	170.86	1913.99	400.80	400.80	703.87
Tue	684.22	934.54	1088.15	751.90	1649.50	168.75	1901.83	396.06	396.06	699.68
Wed	703.22	934.54	1068.78	755.43	1638.98	168.75	1884.63	398.42	398.42	710.47
Thurs	705.45	923.65	1065.76	760.13	1659.42	168.75	1893.18	403.11	403.11	713.62
Changes	26.31	-10.89	-58.25	-8.22	-4.75	-2.11	-61.15	5.68	-2.30	11.42

Source: Nepse

 

In the week, the banking sub-index increased the highest by 26.31 points closing at 705.45 points. With the enforcement of BASEL III, the Banking and Financial Institutions are bound to increase their paid up capital. As per the spokesperson of NRB, the commercial banks are required to soar up their paid up to Rs 5 billion within next 6 years time. Likewise, Development and Finance will also be required to enlarge their paid up capital so as to meet the requirement of BASEL III criteria.

Citing such scenario, the investors last week took the opportunity to grab the BFIs scrips in expectation of the bonus and right shares in future date which attributed in boosting the overall market.

That was followed by the finance sector sub-index which increased by 5.68 points. Contradictory to the BASEL III news development bank sub-index could not boost up; it had shown the bearish trend during the week. The sub-index dropped by 2.30 pints closing at 403.11 points.

The worst performer this week among the traded scrips was NABIL Bank Limited Promotor Share (NABILP), closed at Rs 1400, with loss of Rs 345 or 19.77 percent whereas the best performer was  KIST Bank Limited (KIST), closed at Rs 199, with a gain of Rs 62 or 45.26 percent.

After the cancellation of the merger process with Vibor Bikas Bank Ltd, the trading of KIST shares was resumed from this week in the secondary market. As the KIST price is comparatively lower than the other commercial banks, the traders took this opportunity to grab the scrip at current prices in speculation of price level increase upto Rs 250 within a short span of time.

Driven by such expectation, the market witness the hefty transaction of KIST as it had the highest turnover and shares traded this week.

Though, the market saw the bullish trend, remaining sectors other then bank and finance companies saw the bearish trend during the week. The highest loser of the week was insurance sector with the drop in sub-index by 61.15 points closing at 1893.18 points.

Shares of 148 companies were traded at Nepse during the week through 14,223 transactions amounting to Rs 1,983,800,000. Kist Bank topped the list in terms of transaction amount (Rs 222,070,000). Similarly, Kist topped in number of scrips traded during the week. Altogether 1,250,515 scrips of the Kist Bank were traded during the week. At the same time, Mega Bank was at the top on the basis of the number of transactions (1197).