How to invest in the Nepal share market.

The short answer

To invest in the Nepal share market you need three accounts: a DEMAT with a depository participant, a MeroShare login from CDSC, and a trading account with a SEBON-licensed broker. IPOs are applied for through CASBA inside MeroShare using your own bank account, while listed shares are bought and sold through your broker on TMS and settle on a T+2 cycle. Setup takes about a week and costs under Rs 1,000; a first IPO application needs Rs 1,000 more.

The three accounts you cannot trade without

Nepal splits the job across three institutions, and each one holds a different piece. Missing any one of them stops you cold.

• DEMAT account — opened at a depository participant (DP), usually a bank or broker. This is the vault. Your shares live here in electronic form under CDSC.
• MeroShare — CDSC’s web portal onto that vault. You apply for IPOs here, see your holdings, set your WACC and approve share transfers through EDIS.
• Broker trading account with TMS — the Trade Management System. This is the only way orders reach NEPSE. It comes from your broker, not from CDSC.

Take citizenship, two passport photos, a bank cheque or statement, and your 16-digit DEMAT number once you have it. Full walkthroughs live in our DEMAT account guide and the MeroShare guide.

What the setup actually costs

• DEMAT renewal: Rs 100 a year. MeroShare: Rs 50 a year. About Rs 150 for both, per BOID.
• One-off DEMAT opening charge: set by your DP, so it varies. Ask before you sign.
• Broker account opening: usually free, though brokers differ.
• Applying for an IPO: SEBON caps the ASBA charge at Rs 5 per application.

Your two entry points: primary and secondary

Every rupee that goes into NEPSE arrives one of two ways. They have different rules, different costs and different odds, and beginners meet them in this order.

1. Primary market — IPOs, FPOs and rights issues. You buy from the company at a fixed price, through MeroShare, with no broker and no commission.
2. Secondary market — buying already-listed shares from another investor through your broker on TMS, at whatever price the market is asking.

Applying for an IPO: the cheapest way to start

A fixed-price IPO in Nepal is issued at Rs 100 per share, the face value. The minimum application is 10 kitta (units), so Rs 1,000, and the money is blocked in your own bank account through CASBA rather than transferred away.

1. Log in to MeroShare and open My ASBA.
2. Pick the open issue and enter the kitta you want.
3. Select your CASBA-enabled bank account and enter your CRN.
4. Apply, then note the deadline. Issues stay open a minimum of four daysand can run to fifteen, but an oversubscribed issue closes at the earliest allowed date — so treat day four as the deadline, not day fifteen.

Oversubscription is normal, so allotment is by lottery and most applicants receive the minimum 10 kitta or nothing. Applying for 500 kitta does not improve your odds of being allotted; it only changes what you get if you win. The difference between the two application routes is covered in ASBA versus CASBA.

Book-building issues are the exception. Institutions bid to set the price, retail applicants pay 10% below it, and the retail minimum is 50 kitta rather than 10 — so the cheque is larger and the price is not Rs 100. Fixed-price issues are still the majority; the rules for the rest are in SEBON’s 2026 IPO rules.

Families usually apply from several accounts at once, and then have to check each one separately when results come out. Punji’s bulk IPO checker checks every BOID you save in one pass, which turns a fifteen-minute chore into one tap.

Buying on the secondary market without overpaying

NEPSE trades Monday to Friday, with Pre-Open from 10:30 to 11:00 NPT and continuous trading from 11:00 to 15:00 NPT. Orders you place outside those hours queue for the next session.

1. Transfer funds to your broker’s collateral account, usually via connectIPS.
2. Log in to TMS and open the buy order screen.
3. Enter the scrip, quantity and your limit price.
4. Confirm, then watch the order book — unmatched orders expire at close.

A single stock can move 15% up or down in one day before it is frozen, so a market order in a thin scrip can fill far from the last traded price. Set a limit price, always. The mechanics of matching are in how NEPSE trading works, and the platform itself in the TMS guide.

The fees nobody quotes you upfront

The price on screen is not what leaves your account. Three charges apply to both the buy and the sell.

• SEBON fee: 0.015% of the transaction amount.
• DP charge: a flat Rs 25 per scrip per transaction.

That flat Rs 25 is what punishes small trades. On a Rs 2,000 purchase it alone is 1.25% of your money, before commission, and you pay it again on the way out. Buying one scrip in one larger lot beats buying the same rupees across four small ones.

Our NEPSE calculators run buy cost, sale proceeds and capital gains tax on the same fee engine the app uses, so you can see the real break-even price before you place the order.

Selling: two steps people find out about too late

Selling is not one action. The trade is placed in TMS, but the shares only move if you approve the transfer yourself, and your cost basis has to be on record first.

1. Set your WACC in MeroShare under My Purchase Source, before you sell. This is the average price you paid, and it decides the tax deducted at settlement.
2. Place the sell order in TMS.
3. Approve the EDIS transfer in MeroShare once the trade executes. Miss the deadline and your broker charges a penalty and the settlement is at risk.

Both steps have their own guides: calculating and updating WACC and the EDIS transfer.

The bonus share trap that makes a good year look flat

Nepali companies — banks, hydropower and microfinance especially — pay much of their return as bonus shares rather than cash. This breaks naive portfolio math in three places.

• The price drops on the ex-date. A 20% bonus turns 100 shares into 120, so NEPSE adjusts the price down by roughly the same proportion. Nothing was lost.
• Your WACC falls. Same money spent, more shares held, so the average cost per share drops. If MeroShare has not been updated, your recorded cost is too high or too low and the tax is wrong.
• The shares arrive weeks after book closure. Between book closure and the credit landing in your DEMAT, your holding shows the old quantity at the new price, which reads as a loss.

You must own the share before the book closure date to qualify, and because settlement is T+2, buying on the last day is too late. Buy at least two trading days ahead. Details in bonus shares versus rights shares and dividends explained.

What you owe the tax office

From FY 2083/84 (Shrawan 1, 2083 / July 17, 2026), a resident individual pays 10% capital gains tax on shares held 365 days or fewer and 7.5% on shares held longer. The tax is on the gain, not the sale value, and the broker deducts it at source.

Exactly 365 days is still short-term. Selling on day 366 instead of day 364 changes the rate by a quarter of the tax bill, which is the cheapest decision available to you. Cash dividends are taxed separately at 5%, withheld by the company before it pays you.

The rate change and a worked example are in the new CGT rates guide.

Picking what to buy, without guessing

NEPSE lists roughly 280 companies across 15 sectors, and the index is dominated by a handful of them — banking, financial institutions and insurance alone are over half the market capitalisation. Three questions do most of the work.

• What is it worth? Compare P/E ratio and book value against the sector, not against the market. See P/E and book value.
• Who is actually trading it? The live floorsheet shows every executed trade with broker numbers, so you can see whether a rally is broad or one buyer.
• Is the whole sector moving, or just this stock? The heat map answers that in a glance.

To narrow the list, the screener filters by sector, price and fundamentals, and the compare tool puts two scrips side by side so you are choosing between them rather than reading about each in turn.

Common mistake to avoid

Buying five stocks and calling it diversification. Banks, development banks and microfinance move on the same interest rate and liquidity news, and hydropower moves on monsoon and PPA news. Five names from two of those groups is one bet held five ways.

Check what you own by sector before you add to it. A portfolio that is 80% financials is a view on NRB policy, whether or not you meant to take one.

Pro tip

Record the purchase source in MeroShare the week you buy, not the week you sell. IPO allotments, bonus credits and rights take-ups each need confirming, and reconstructing three years of them under an EDIS deadline is how people overpay tax.

Keeping the same holdings in Punji’s portfolio tracker gives you the second copy: live value, adjusted cost per share after bonus issues, and a countdown to the day each holding crosses into the long-term tax band.

Where to go next

• Never opened an account: the DEMAT guide.
• Account open, first IPO: how to apply for an IPO.
• First secondary trade: the TMS guide.
• About to sell: WACC, then EDIS.