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Nepal Stock Exchange (Nepse) is gearing up to launch the new stock trading index ‘Nepse 30’ within a month. After completing the necessary technical and policy preparations, the Nepse plans to bring ‘Nepse 30’ into operation by the first week of October.

The ‘Nepse 30’ index is currently being tested internally. The test, which started on July 25, has shown that the ‘Nepse 30’ index can be operated. According to Nepse officials, an official announcement on it will be made soon. 

The procedure prepared for the operation of ‘Nepse 30’ has been submitted to the Nepse board for approval. The upcoming board meeting of the Nepse is likely to endorse it, paving the way for the operation of the ‘Nepse 30’ index.

Nepse Spokesperson Murahari Parajuli said that the related procedure has already reached the Nepse board. “The upcoming meeting of the board will discuss the procedure,” he said, “After the approval of the board, the ‘Nepse 30’ index will come into operation.”

According to Parajuli, Nepse has also completed technical preparations including the IT system required to operate the ‘Nepse 30’ index. Currently, a trial is being carried out internally selecting a few companies. 

Nepse has envisioned Nepse 30 as an index based on the share trading of 30 selected companies. The new index will comprise the top 30 companies that meet the criteria set by Nepse among all the listed companies.

However, Nepse 30 will not be a separate index. At present, there are 13 sub-indices in Nepse alongside sensitive, float, and sensitive float indices.  According to Nepse, companies from six sectors including banks and financial institutions, microfinance, insurance, hydropower, manufacturing, and trade and services will be included in the Nepse 30 index. Each of these sectors will have a minimum of one company to a maximum of eight companies in the index.

Companies having profits in the last three years, having earnings per share of more than 10 percent of the paid-up capital, and having earnings per share higher than the inflation will be eligible for the ‘Nepse 30’. Similarly, the companies are also required to have issued at least 25 percent of the shares to the general public and have at least 20,000 shareholders.

Similarly, companies’ average daily turnover in the last six months should be at least 2.5m, and their average daily share trading of 5,000 units. 

The Nepse has said that it is introducing ‘Nepse 30’ with the aim of developing, operating, and managing indices to strengthen secondary market transactions. 

The ‘Nepse 30’ index will be implemented as an index based on market capitalization including immediately tradable (free float) shares.

Nepse had previously prepared to bring the ‘Nepse 50’ index. However, it went for the ‘Nepse 30’ arguing that there could be problems in managing 50 companies. 

The price of gold has increased by Rs 300 per tola in the domestic market on Friday.

According to the Federation of Nepal Gold and Silver Dealers’ Association, the precious yellow metal is being traded at Rs 112, 300 per tola today. It was traded at Rs 112, 000 per tola on Thursday.

Meanwhile, tejabi gold is being traded at Rs 111, 750 per tola. It was traded at Rs 111, 450 per tola.

Similarly, the silver is being traded at Rs 1,410 per tola today.

It’s been four months since the government took over Smart Telecom revoking its license but the asset valuation of the embattled telecom is yet to begin.

Smart Telecom lost its telecom license in the third week of April, after failing to clear the dues and renewal fees it owes to the Nepal Telecommunications Authority (NTA). The NTA took over the company on May 2.

After taking over Smart Telecom on May  2, the NTA had formed an asset management committee, headed by its board member Gokarna Mani Sitaula. However, the committee has remained inactive after one of its members—Anup Nepal—refused to be part of it.

Since Smart Telecom is currently under the control of the NTA, it was earlier said that the auction process would be carried out after determining the price of the company. For this, the regulator had advanced the process of setting up a price determination committee in the first week of May itself.

The NTA has so far issued four notices for the formation of a committee to determine the property value of Smart Telecom, seeking a letter of intent from qualified evaluators.

A letter of intent has been invited for the five-member committee including the coordinator, specifying various qualifications. In order to become the coordinator of the committee, one should have a registered evaluator or a  degree in chartered accountancy or a master’s degree in management.

Achyutanath Mishra, assistant spokesperson of the NTA said that a committee has not been formed to determine the value of Smart Telecom. “We have issued notice thrice to form the committee. On Aug 23 again, we issued a notice for the fourth time,” he said.

The company owes Rs 28bn to NTA, of which Rs 23bn is for license renewal and Rs 5bn as dues. While NTA can recover the arrears from Smart Telecom’s assets and income. However, not all arrears cannot be recovered from the company’s assets. For that, the company has to be sold. The authority can make another decision on whether to operate or close the company. However, there is also a possibility that the dues of the government will not be recovered when the company is closed. Therefore, the NTA is forced to collect its arrears by selling the company.

Smart Telecom received the basic telephone services operating license on 15 April 2013, and had to renew the license by paying dues and renewal fees before the permit term expires. However, the company had defaulted in clearing the dues in the past and had sought an extension from the government several times. The then KP Sharma Oli-led government had allowed the company to clear the dues in five installments. Even then, Smart Telecom was not able to clear the outstanding amount.

The Singapore-based Lal Sahu Distribution Pte Ltd has a majority stake of 70 percent in Smart Telecom. By using political influence, the company in the past had been successful in getting extensions to pay dues as well as securing its license even when the regulator revoked it. This time also, the promoters of the company did intense political lobbying to secure the license, but to no avail.

On 29 July 2019, NTA revoked the license of Smart Telecom. However, the company succeeded in rolling back the authority’s decision after it filed a review application at the Ministry of Communication and Information Technology within five months.

Before its license was revoked, the company had 2.2m customers and had 558 towers. It had a frequency of 5 MHz in the 900 band and 12 MHz in the 1800 band. 

The Nepal Stock Exchange (NEPSE) plunged by 28. 92 points to close at 1,932.45 points on Thursday.

Similarly, the sensitive index dropped by 5. 65 points to close at 371. 58 points.

A total of 3,769,033-unit shares of 276 companies were traded for Rs 1. 15 billion.

Meanwhile, Shuvam Power Limited was the top gainer today with its price surging by 10. 00 percent.

Likewise, Barahi Hydropower Public Limited was the top loser with its price dropped by 9. 71 percent.

At the end of the day, the total market capitalization stood at Rs 2. 89 trillion.