Urja Khabar
KATHMANDU; Hydropower companies have emerged as the most appealing segment for investors in Nepal’s secondary market, accounting for nearly half of the total trading turnover over the past month despite a broader decline in the stock market.
According to data from the Nepal Stock Exchange (NEPSE), the hydropower sector accounted for 46.17 percent of the total Rs 95.35 billion trading turnover recorded between mid-July and mid-August.
The strong trading activity in hydropower stocks comes at a time when the overall market has remained under pressure, with the NEPSE index declining on most trading days. Despite the bearish sentiment, investors appear increasingly willing to put their money into hydropower companies, driven largely by expectations of higher profits and potential dividend payouts.
Stockbrokers said improved financial performance has strengthened investor confidence in the sector. A significant number of listed hydropower companies reported higher profits in the last fiscal year, raising expectations of dividend distribution among shareholders.
According to NEPSE, 106 listed hydropower companies generated a combined net profit of Rs 11.11 billion in the last fiscal year, a sharp increase from just Rs 1.22 billion in the previous fiscal year.
“Investors are rushing to buy hydropower shares, mainly on expectations of receiving dividends,” a stockbroker said, requesting anonymity.
The increased investor interest has made hydropower the dominant sector in terms of trading activity. Alongside hydropower, commercial banks and manufacturing and processing companies also recorded substantial turnover during the period.
Together, the three sectors accounted for 69.3 percent of the total trading activity, highlighting their growing influence on Nepal’s secondary stock market.
The surge in hydropower trading indicates that investors are increasingly focusing on companies with stronger earnings prospects and the potential to reward shareholders, even as the broader market continues to face downward pressure.
