Improved calculations and high dividends draw attention

The gloom in the market faded slightly this week as investors´ confidence went up due mainly to improved valuations. As predicted last week, the Nepse index (+2.14%) took an upturn on the first three days of the week and then derailed Wednesday onwards to close at 627.97 points. This is the first weekly gain since the last week of July. However, the recovery is weak in view of the transaction volume (Rs 438,113,100) which dropped by 13.30 percent as compared with the previous week´s transactions. [break]



The announcements of Global Bank (+Rs 75) to allot 2:1 right shares and Laxmi Bank (- Rs.110) to issue 7 percent bonus shares and 5:2 right shares boosted the Commercial Banking sector (+3.62%). Additionally, Development Credit Bank (+Rs 4), which declared 5% bonus shares, and Citizens Bank International (+Rs.53), which announced 10% cash dividend and 1:1 rights shares, also supported the gains in the sector.



Everest Finance (+Rs 65) topped the gainers´ chart along with Kaski Finance (+Rs.31) but the Finance sector (-0.45%) still observed a fall. Similarly, Clean Energy Development Bank (+Rs 111) posted a big gain but the loss in the values of Business Development Bank (- Rs 343) and Ace Development Bank (-Rs 37), which declared 5.5% cash dividend, denied a rise in the Development Banks´ index (-2.02%). The decline in the price of shares of Butwal Hydropower (-Rs.19) brought down the Hydropower sector´s index down by 0.21%. Insurance sector (-3.11%) witnessed the biggest slump due to the readjustment in the share price of Rastriya Beema Sansthan (-Rs 342). The demand for Nepal Telecom (+ Rs 11) shares rose this week bringing the ´Others´ index by 2% up.



Among other developments in the market in this week, Securities Board of Nepal (SEBON) has called for suggestions from the public to formulate regulations pertaining to Investment Management.



Apart from the companies above, Prabhu Finance (+ Rs 6) declared 10.53% cash dividend, United Finance (-Rs.36) declared 12.5% bonus share and 0.65% cash dividend, Reliable Finance (+Rs.103) declared 20% bonus shares and 10% cash dividend and Gorkha Finance (-Rs 14) is offloading 4,500 units of its promoter shares.



In the banking sector, Everest Bank (+Rs 60) is distributing 7% dividend warrant on its Preference shares and Prime Commercial Bank has allotted its IPO share certificates. Annapurna Bikas Bank (+Rs 21) declared 15% cash dividend.



Market activities are expected to be low next week as the festival holiday sets in. However, technical analysis tools indicate that the overall price movements have now stabilized.

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