Nepal Stock Market Sector Analysis for March 26, 2026
The Nepal Stock Exchange concluded March 26, 2026, with a positive session as the NEPSE index advanced 0.48% to close at 2,950.16. The previous close was 2,935.94, marking a gain of 14.22 points. What made this session particularly noteworthy was the breadth of sector participation, with 10 out of 12 sectors registering gains.
The Sensitive Index complemented the move, closing at 502.44 (+0.40%), while the Float Index outperformed at 202.77 (+0.51%). The Float Index outperformance suggests mid-cap stocks with higher free-float ratios may have performed better than concentrated large-cap names on this day.
Sector rotation dynamics have been one of the key themes in the Nepal stock market during March 2026, and the data from March 26 provides valuable insights into which sectors are attracting investor capital and which are seeing outflows.
Hydropower: The Undisputed Leader
The Hydropower sector dominated the day with a commanding 1.57% gain, pushing its sector index to 4,065.76. This outperformance was driven by fundamental and seasonal factors that make hydropower stocks particularly attractive during the pre-monsoon period.
Two hydropower stocks appeared in the top 10 gainers list. NHPC surged 6.24% to Rs.320.0 with massive volume of 1,483,269 shares, making it the most traded stock on the exchange. RIDI rose 6.19% to Rs.379.0 with 1,218,929 shares traded. The combination of price gains and heavy volume in these names suggests strong institutional interest.
Other hydropower stocks contributing to the sector rally include HDHPC with 763,427 shares traded and several smaller hydro companies. The sector benefits from increasing domestic electricity demand, export potential to India, and government policies encouraging hydropower development in Nepal.
From a seasonal perspective, the approaching monsoon season means rivers will swell, increasing power generation capacity for hydropower plants. This predictable increase in output often leads to front-running by institutional investors who position ahead of improved quarterly earnings.
Manufacturing: Strong Second-Place Finish
The Manufacturing sector secured the second-best performance of the day with a 1.51% gain to 10,527.90. RSML was a standout performer, hitting the 10% upper circuit at Rs.2,013.1, indicating extraordinary demand for this manufacturing stock.
Manufacturing sector performance is often seen as a proxy for domestic economic health. A strong session for manufacturing stocks suggests that industrial activity and consumer demand may be improving. This sector tends to benefit from stable interest rates and steady consumer spending.
Hotels and Tourism Recovery
The Hotels sector gained 0.81% to 7,761.14, reflecting continued optimism about Nepal's tourism recovery. Nepal has been experiencing steady growth in tourist arrivals, supported by improved air connectivity and promotional efforts by the tourism board.
Hotel stocks typically show seasonal patterns, with the spring trekking season and autumn peak driving positive sentiment. The 0.81% gain on March 26 fits within this broader positive trajectory for the sector.
Full Sector Performance Table
| Sector | Index | Change % |
|---|---|---|
| Hydropower | 4,065.76 | +1.57% |
| Manufacturing | 10,527.90 | +1.51% |
| Hotels | 7,761.14 | +0.81% |
| Others | 2,416.42 | +0.66% |
| Investment | 113.21 | +0.51% |
| Non-Life Insurance | 11,858.96 | +0.43% |
| Banking | 1,550.82 | +0.37% |
| Microfinance | 5,211.85 | +0.20% |
| Finance | 2,652.93 | +0.17% |
| Life Insurance | 13,600.30 | -0.04% |
| Dev Bank | 6,369.68 | -0.06% |
| Trading | 4,155.10 | -2.84% |
The Others category gained 0.66% to 2,416.42, encompassing various companies that do not fit into the main sector classifications. Investment companies rose 0.51% to 113.21, while Non-Life Insurance advanced 0.43% to 11,858.96.
Banking, despite its relatively modest 0.37% gain, is crucial due to its dominant weight in the NEPSE index. The sector index of 1,550.82 reflects stability in the banking system, supported by the NRB's accommodative policy stance with repo rate at 4.25% and lending rate at 7.00%.
Microfinance gained 0.20% to 5,211.85, while Finance rose a modest 0.17% to 2,652.93. These financial sub-sectors have been steady performers without dramatic moves in either direction.
Underperforming Sectors: Trading and Dev Bank
The Trading sector was the worst performer by a significant margin, falling 2.84% to 4,155.10. This sharp decline stands in stark contrast to the overall positive market and may reflect sector-specific challenges, profit-booking after previous gains, or concerns about trading company fundamentals.
Development Bank sector was marginally negative at -0.06%, closing at 6,369.68. Life Insurance was essentially flat at -0.04%, with its index at 13,600.30. These minor declines in the context of a broadly positive market are not causes for alarm and may simply reflect normal sector rotation.
Top Gainers Across All Sectors
| Symbol | Price (Rs) | Change % |
|---|---|---|
| HFIN | 262.9 | +10.0% |
| RSML | 2,013.1 | +10.0% |
| SKHL | 363.0 | +10.0% |
| BJHL | 434.8 | +9.99% |
| SOHL | 707.1 | +9.99% |
| KBLD89 | 1,346 | +8.11% |
| SCBD | 1,198 | +7.25% |
| NIMBD90 | 1,267 | +6.65% |
| NHPC | 320.0 | +6.24% |
| RIDI | 379.0 | +6.19% |
The three upper circuit hits (HFIN, RSML, SKHL) spread across different sectors show that individual stock stories can drive exceptional gains even in a modest market rally. BJHL and SOHL at 9.99% were just fractions away from their own upper circuit limits.
The debenture market also saw significant movement with KBLD89 (+8.11%) and NIMBD90 (+6.65%) posting notable gains. Debenture performance often reflects changing interest rate expectations, and gains in these instruments suggest the market may be pricing in stable or declining rates ahead.
Top Losers Analysis
| Symbol | Price (Rs) | Change % |
|---|---|---|
| PMHPL | 396 | -7.48% |
| SINDU | 833 | -3.58% |
| CORBL | 2,003 | -3.24% |
| BBC | 5,332 | -3.04% |
| NIBLGF | 9.7 | -2.60% |
| NIBSF2 | 9.6 | -2.55% |
| CSY | 9.6 | -2.35% |
| SABBL | 1,683 | -2.09% |
| SBLD89 | 1,240.5 | -1.99% |
| MATRIP | 523.5 | -1.98% |
PMHPL was the standout loser, falling 7.48% to Rs.396. Such a significant decline in a positive market often points to company-specific developments rather than broader market dynamics. SINDU dropped 3.58% and CORBL fell 3.24%, both experiencing selling pressure despite the favorable market environment.
Banking Sector Stock-by-Stock Review
The banking sector deserves detailed attention given its crucial role in the NEPSE index and the broader economy. Here is how all 18 commercial banking stocks performed on March 26:
| Symbol | Price (Rs) | Change % |
|---|---|---|
| EBL | 712 | -0.28% |
| SCB | 677 | -0.28% |
| NABIL | 543 | +0.74% |
| SBI | 429.9 | +0.47% |
| SBL | 412.9 | +0.22% |
| NICA | 401 | +0.75% |
| SANIMA | 364.7 | -0.63% |
| ADBL | 333.1 | +0.94% |
| NBL | 288 | +3.26% |
| MBL | 266.9 | -0.04% |
| NMB | 265 | -0.26% |
| PCBL | 262.9 | -0.42% |
| GBIME | 254.8 | +0.87% |
| KBL | 240 | -0.74% |
| LSL | 235 | +0.47% |
| CZBIL | 229 | +1.01% |
| NIMB | 224.5 | +0.31% |
| PRVU | 223.7 | +0.27% |
NBL was the clear outperformer among banks, gaining 3.26% to Rs.288 with substantial volume of 795,076 shares. This level of buying interest in a major commercial bank often signals institutional accumulation. CZBIL rose 1.01%, ADBL gained 0.94%, and GBIME advanced 0.87%.
The mid-range banks including NABIL (+0.74%), NICA (+0.75%), SBI (+0.47%), and LSL (+0.47%) showed modest but positive performance. The premium banks EBL and SCB both dipped 0.28%, suggesting some valuation resistance at higher price levels.
Volume Leaders and Institutional Interest
| Symbol | Volume (Shares) |
|---|---|
| NHPC | 1,483,269 |
| KBL | 1,376,910 |
| RIDI | 1,218,929 |
| HIDCLP | 913,029 |
| API | 886,037 |
| NGPL | 853,071 |
| AKJCL | 808,838 |
| NBL | 795,076 |
| HDHPC | 763,427 |
| NRN | 571,390 |
The volume data tells an important story about institutional money flows. The top three volume leaders (NHPC, KBL, RIDI) collectively traded over 4 million shares, indicating significant capital deployment. When institutional investors are actively participating, volumes tend to cluster in established, liquid names.
Macroeconomic Backdrop
The NRB's monetary policy framework continues to provide a supportive environment for equities. The repo rate at 4.25% keeps borrowing costs manageable for businesses. The deposit rate at 3.51% makes fixed deposits less attractive compared to equity returns, pushing savers toward the stock market.
The lending rate at 7.00% supports business expansion and consumer spending. The CD ratio at 74.32% indicates healthy credit deployment by banks without excessive risk-taking. NPL at 5.42% requires monitoring but remains within manageable limits. The CAR at 12.61% confirms that the banking system is adequately capitalized.
Market Outlook and Sector Rotation Expectations
Looking ahead, the sector rotation dynamics observed on March 26 provide clues about near-term market direction. The outperformance of hydropower and manufacturing suggests that investors are positioning in sectors with visible earnings catalysts.
The banking sector, with its modest 0.37% gain despite significant index weight, has room for a catch-up rally. If banking stocks begin to move more aggressively, the additional index weight could push NEPSE past the 3,000 resistance level.
Investors should watch for continued sector rotation as the market approaches the 3,000 barrier. Sectors that have lagged, such as Finance and Microfinance, could see catch-up buying, while leaders like Hydropower may see profit-booking. The Trading sector's sharp decline warrants caution, and investors should evaluate whether this represents a buying opportunity or the beginning of a more sustained downturn.