A Study on NEPSE: Growth of Index, Market Cap, Listed Companies and Trading Turnover
November 28, 2025 | Investopaper
Established in 1994 with just 66 listed companies and a market capitalization of NPR 13.87 billion, the Nepal Stock Exchange (NEPSE) has grown over the subsequent 31 years reaching 272 listed companies, a market capitalization of NPR 4.66 trillion, and an index level of 2,794.8 by 2025. This analytical study presents NEPSE’s complete historical performance from 1994 to 2025, examining the evolution of the NEPSE Index, market capitalization, paid-up capital, number of listed companies, and trading turnover through summary statistics, trend analysis, and year-over-year growth comparisons.
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1. Key Summary Statistics (1994–2025)
| Metric | 1994 | 2025 | Growth Factor / % |
|---|---|---|---|
| Listed Companies | 66 | 272 | +312.1% (4.1x) |
| Paid-up Capital (NPR Mn) | 2,182 | 869,855 | 398x |
| Market Capitalization (NPR Mn) | 13,872 | 4,656,989 | 336x |
| NEPSE Index | 126.0 | 2,794.8 | +2,118% |
| Annual Trading Turnover (NPR Mn) | 41.6 | 2,124,916 | >51,000x |
2. Historical Trends and Major Phases
Phase 1: Early Years (1994–2007)
- Gradual increase in listed companies and paid-up capital.
- NEPSE Index remained range-bound between 126 and 683.9.
- Low liquidity (turnover rarely exceeded NPR 1–2 billion annually).
Phase 2: First Major Bull Run (2007–2008)
- Market cap tripled from NPR 186 billion (2007) to NPR 366 billion (2008).
- Index Closed at 963.4.
Phase 3: Market Correction (2009–2016)
- Sharp correction in 2009–2011 (Index fell to 362.9).
- Slow recovery with steady increase in listed companies.
Phase 4: Structural Breakout (2016–2021)
- Index crossed 1,000 in 2016 and reached 1,718 in 2017.
- Massive capital raising by banks and hydropower companies.
- Market cap crossed NPR 4 trillion in 2021.
Phase 5: COVID & Post-COVID Boom (2020–2025)
- Unprecedented liquidity surge in 2020–2021 (turnover jumped from NPR 11 billion to NPR 1.45 trillion in 2021).
- Market cap more than doubled in four years (2021 → 2025).
- 2025 marks all-time highs across nearly every metric.
Related:
Performance Analysis of Mutual Fund vs. NEPSE Index
Analysis of Performance of Hydropower Index Compared to NEPSE Index
3. Key Visual Insights
NEPSE Index Trend: Steady long-term uptrend with three major bull cycles (2003–2008, 2013–2017, 2019–2025).
Market Capitalization Growth: Exponential growth trajectory, especially post-2015.
Trading Turnover: Dramatic structural shift after 2020. Turnover in 2021–2025 dwarfs the combined turnover of the previous 26 years.
Listed Companies:
Comparision of Nepse Index and Market Cap Growth:
Suggested Reading:
Comparative Performance Analysis of Life Insurance Index and NEPSE Index
Performance Analysis of Non-Life Insurance Index
4. Conclusion
Over the past 31 years (1994–2025), the Nepal Stock Exchange has transformed from a nascent market into dynamic equity market. Key highlights include:
- NEPSE Index rose from 126.0 in 1994 to 2,794.8 in 2025 → +2,118.1% total return (+21x).
- Market capitalization expanded 336-fold, from NPR 13.87 billion to NPR 4.66 trillion.
- Number of listed companies increased by 312.1% (66 → 272).
- Trading turnover exploded in the post-2020 era, reaching an all-time high of NPR 2.12 trillion in 2025.
The market has shown remarkable resilience and structural growth despite periodic corrections in 2008–2011 and 2018–2020. Investors with a 5–10 year horizon continue to be rewarded by staying invested through cyclical volatility.
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