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    What does NEPSE Index Mean?

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    What is NEPSE Index?

    Nepal stock exchange at the end of the day the transaction index which is called the NepSe index. In simple language, the base market capitalization is used to calculate the Nepse index. The base market capitalization is February 12, 1994. In this day, share transaction was held for the first in Nepal Stock Exchange. It is the index to show the of the stock market. The increase in the value transaction of transacted share increase than the market capitalization value increase. While calculating the market capitalization, the total share is multiplied by a certain day’s share value. As there is a different value of share number and share price, separate multiply value is calculated and added later to find the total sum. In this way, market capitalization is calculated. For example, the company named ‘SBC’ registered 5, 00,000 number of shares @ Rs 100. On that day, the market capitalization value was Rs 50 crore. The market capitalization of each company is added to find out total market capitalization. Stock exchange finds out the market index on the base of market capitalization.

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    the market capitalization increases, the Nepse index increases where market capitalization decreases, the Nepse index decrease. For example, on Ashad 24, 2067, the total market capitalization was Rs 3 Kharab 61 Arab 59 crore 77 lakh whereas adjusted base market capitalization was Rs 78 Arab 59 crore 70 lakh 5 thousand only.

    Likewise, the Nepse index calculation formula is given below.

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    Current Market Capitalization
    NEPSE index = × 100
    Adjusted Base Market Capitalization

    Rs 361597.70
    Or, Nepse Index= × 100
    Rs 78597.05

    = 460.07
    Therefore, the Nepse index was close at 460.07 points.

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