Nepse now plans to demat stock of 75% of listed companies by Bhadra end

ShareSansar, August 18:

Back in July Nepal Stock Exchange Limited (Nepse) had issued a directive to all the listed companies to demat their stock by Shrawan end.

However, even at the end of the deadline, just 18 companies have actually reached an agreement with CDSC, a Nepse subsidiary, which handles the process, for dematerialization of their stock.

“Apart from these 20 listed companies, 49 others have applied for the agreement as of now,” CDSC official Sabina Pujari told ShareSansar. “More companies have been approaching us, though.”

Clearly just a handful of the listed companies will be able to meet the deadline issued by Nepse, which expired on August 16.

What next?

“Well, since Nepse had issued the directive in the first place, it is up to them to chalk out the line of action,” says Managing Director of CDSC, Subodh Sharma Sigdel. “They must be planning something.”

“Now we will start issuing a seven-day deadline to the sector groups, initially targeting frequently trading companies such as insurance, finance companies, development banks and hydropower, besides NTC,” says Nepse Spokesperson Shambhu Panta.

He further said that Nepse also plans to even currier the copy of agreement to be sealed between CDSC and the concerned listed companies, which are operating outside the capital, to help speed up the process.

“See, the actual idea behind this deadline business is to facilitate CDSC to expedite the process to demat stock of the listed companies,” he explained, adding that Nepse wants to see at least 75 percent of the listed companies to demat their stock by Bhadra end.

What if the listed companies as well as the CDSC fail to ensure the new target?

“We will start taking action against the listed companies that fail to demat the stock,” says the Nepse spokesperson. “We will suspend their scrip, which will then force them to comply.”   

Meanwhile Nepse General Manager Sitaram Thapaliya said that if the listed companies have any genuine concerns, including regarding the CDS charges, we are ready to take up the matter with the regulator and the government.

“But they also need to realize that CDSC needs to generate enough revenue to sustain itself,” Thapaliya added.