Comprehensive Analysis of Securities Market Turnover in the Nepal Stock Exchange (NEPSE)

The securities market turnover for different categories from mid-July to mid-April over three fiscal years: 2021/22, 2022/23, and 2023/24. Here's a detailed interpretation of the data:

Overview

• The table is divided into three main columns for each fiscal year, further subdivided into:

  • Share Units (in thousands)

  • Value (in Rs million)

  • % Share of Value

Key Insights

2021/22

• Total Turnover: 2,211,211.92 thousand units, valued at Rs 1,101,124.80 million.

• Highest Turnover by Value: Commercial Banks with Rs 183,278.1 million (16.6% of total value).

• Significant Categories:

  • Hydropower: 301,915.6 thousand units, Rs 331,915.6 million (30.1% of total value).

  • Microfinance: Rs 103,275.5 million (9.4% of total value).

  • Development Banks: Rs 119,628.0 million (10.9% of total value).

2022/23

• Total Turnover: 885,289.05 thousand units, valued at Rs 322,113.71 million.

• Highest Turnover by Value: Commercial Banks with Rs 50,809.9 million (15.8% of total value).

• Significant Categories:

  • Hydropower: 316,658.8 thousand units, Rs 98,788.2 million (30.7% of total value).

  • Development Banks: Rs 22,729.5 million (7.1% of total value).

  • Life Insurance Companies: Rs 15,677.5 million (4.9% of total value).

2023/24

• Total Turnover: 1,413,434.02 thousand units, valued at Rs 473,006.05 million.

• Highest Turnover by Value: Hydropower with Rs 140,523.1 million (29.7% of total value).

• Significant Categories:

  • Commercial Banks: Rs 49,346.7 million (10.4% of total value).

  • Microfinance: Rs 27,671.5 million (5.9% of total value).

  • Development Banks: Rs 68,901.5 million (14.6% of total value).

Trends and Observations

1. Hydropower Sector:

   • Consistently showing high turnover by value across all three years, maintaining a significant share of the market turnover.

2. Commercial Banks:

   • Although the share of value decreased from 16.6% in 2021/22 to 10.4% in 2023/24, it remains a prominent category.

3. Microfinance:

   • Fluctuating but maintains a steady presence with significant turnover in all years.

4. Development Banks:

   • Increased its share significantly in 2023/24 compared to previous years.

5. Life and Non-life Insurance Companies:

   • Both categories show stable turnover but have a relatively smaller share compared to other major sectors.

6. Mutual Fund:

   • A consistent but small share in the total turnover.

Summary

• The securities market turnover data shows significant activity in sectors like Hydropower, Commercial Banks, Development Banks, and Microfinance.

• Hydropower sector appears to be leading in market value share, especially in the latest fiscal year (2023/24).

• The overall turnover value and share units indicate the market's fluctuating nature, with notable increases in total turnover in the 2023/24 fiscal year.

Interpretation of the Charts

Share Units Turnover

• Hydropower consistently shows the highest number of share units traded across all three years, peaking in 2021/22 and remaining strong in subsequent years.

• Commercial Banks and Development Banks also show significant share units turnover, with a noticeable increase in 2023/24 for both sectors.

• Other categories such as Microfinance, Investment, and Mutual Fund display moderate activity in terms of share units traded.

Value Turnover

• Hydropower leads in value turnover, especially prominent in 2021/22 and 2023/24, indicating high investor interest and significant market activity in this sector.

• Commercial Banks and Development Banks also maintain high value turnover, reflecting their importance in the market.

• The Microfinance sector shows consistent value turnover, highlighting its steady performance.

• Life Insurance Companies and Non-life Insurance Companies have lower but stable value turnovers across the years.

% Share of Value Turnover

• Hydropower dominates the % share of value turnover, especially in 2021/22 and 2023/24, underscoring its critical role in the securities market.

• Commercial Banks and Development Banks show a decrease in % share of value turnover over the years, but they still hold significant portions.

• The Microfinance sector's share of value turnover remains stable, reflecting its consistent market presence.

• Other sectors like Manufacturing & Processing and Investment have smaller but noteworthy shares of the market value turnover.

Summary

• The charts highlight the dominance of the Hydropower sector in both share units and value turnover, indicating strong investor interest and activity.

• Commercial Banks and Development Banks also play significant roles in the market, though their relative share of value has decreased over time.

• Microfinance remains a consistent performer across all three years.

• The overall trends indicate that while some sectors like Hydropower see substantial activity and value, others maintain a steady but smaller presence in the market.