Study committee recommends strategic partner for NEPSE reforms, capital increase

KATHMANDU: A study committee has submitted its report to the government recommending the appointment of a strategic partner for Nepal Stock Exchange (NEPSE) reforms, capital increase and ownership restructuring.

The Ministry of Finance today unveiled the report, titled 'NEPSE Restructuring Recommendation Committee, 2082'. The committee was formed by a meeting of the Council of Ministers on November 18, 2025 and comprises six members under the coordination of senior chartered accountant Prakash Jung Thapa.

The committee recommended reforms aimed at making NEPSE a modern, competitive and technology‑friendly entity. The report concluded that, with the expansion of the capital market, NEPSE appears incapable of meeting future challenges under its current structure and functioning.

The report states that without fundamental improvements in technology, management, service expansion and institutional governance, NEPSE will not be able to compete at regional and international levels. It notes that, under the Securities Market Operation Regulations, 2064 BS, NEPSE, as the secondary market operator, is required to maintain a minimum paid‑up capital of Rs 300 million.

However, the committee found the current capital structure insufficient given the need for continuous substantial investment in technology modernisation, human resources, physical infrastructure, research and development, and auxiliary service expansion. In this context, it suggested issuing bonus shares to immediately raise the paid‑up capital to Rs 300 million.

Looking further ahead, the committee said NEPSE may need to undertake a rights issue or issue additional new shares for its development and expansion. The report, however, stresses the need for clarity on whether a strategic partner will be brought in before any capital increase.

The committee determined that operating NEPSE with its current ownership and structure would make it difficult to seize future opportunities and meet challenges. Concluding that the dominance of government and government‑owned institutions has slowed decision‑making, weakened innovation and blurred accountability, the committee stated that a change in the ownership structure is inevitable and primarily proposed bringing in a strategic partner.

According to the committee, an international strategic partner is needed to fill gaps in NEPSE’s technical and managerial expertise and to provide modern infrastructure.

(With inputs from RSS)