Happy dashain to everyone!!!

Nepse is at an all time low  in a couple of years right now...do you think it is the right time to invest in stocks in Nepal or it has not yet hit the rock bottom yet...

 

Happy dashain to you jingme and all sajhaites!

What sort of advice are you looking for? Are you speculating or interested in finding suitable investments - similar to the way you would invest in NYSE or NASDAQ or OTC?

I have not had any experience with NEPSE - but I am interested on other people's opinion on the exchange. Similar to other emerging markets, I have had my share of discerning criticism on the lack of fundamental footing on the provisions of financial services in Nepal. Here are a few:

- Corporate governance: when I read NTC's annual report I cannot help but scratch my head on the organization's going concern clauses, transparency on a set of strategic principles, proxies for management's views on competition, etc. I am not able to get a sense of future direction.

- Securities regulation: who is the regulating body and what are the policies set forth to protect the investors.

- Reporting accountability: in 2003, Nepal agreed to adopt IFRS as the standard for reporting (annual reports and otherwise). I have not seen a single report as of yet that truly follows this standard. I can make out my valuation - but I sure as hell am nervous on how their accounting treatments come from.

- Market liquidity: this is a huge concern if you happen own a substantial amount of equity. You will pay a huge spread when buying or selling and you may have to deal with market maker(s) who don't always follow the security laws.  

- Industry dynamics and profit transparency: If you are an analyst in your own right and you want to research a company you may not have a lot of public material to go on even if the company is public. You will have to conform to what we call in the industry, 'mosaic theory' in order to put together your research. This means it is going to be difficult to analyze whether NTC's earnings are really what it says it earns. And there are no comaprables you can use either. It's more like either you believe them or not - and this is hard to swallow if you are used to free flow of financial information as you would get from Moody's, S&P's, Barron's, Morningstar, your brokerage house, etc.

Anyone with some intelligent insights on the Nepal's securities markets would be awesome.   

Thank you javabeans for your response

I am completely with you on the regulative part of nepal stock market.

This might just sound superficial but I thought I'd jst say it anyways

Nepse is jst in the beginning phase and I feel that it still has to evolve from the manipulators and the evasive broker era and of course the rumor driven investors

the new CDS  which they are hoping to implement might come to aid

no doubt companies will fall along the way and i expect a lot of them to

but how about the banking sector...Nepal runs on remittance, that money has to circulate

I dont think you coud do anything in shortterm but how about longterm...3-5 yrs down the road

I cannot provide concrete terms to back up my idea because I sure have not been in this as long as you have..but just some ideas that i had in my head

happy dashai