NEPSE Directs Listed Companies to Submit Information on Time
8th September 2025, Kathmandu
Nepal Stock Exchange Limited (NEPSE) has issued a directive compelling all listed companies to submit their financial and corporate information within specific deadlines and through designated channels.
NEPSE Issues Directive
This order, based on Regulation 22 of the Securities Listing Regulations, 2075 and the terms of the Securities Listing Agreement, is a proactive measure to enhance financial transparency, protect shareholders, and improve the reliability of the market. Companies that fail to comply with these rules will face regulatory penalties and enforcement actions.
Mandatory Reporting and Disclosure Requirements
The directive from NEPSE outlines a series of mandatory reporting requirements to ensure a continuous flow of accurate information to the public. Companies are required to submit their annual financial reports within five months of the fiscal year’s end and their quarterly financial reports within 30 days of each quarter. These reports must be audited by external auditors and must include key financial metrics such as Earnings Per Share (EPS), Price-to-Earnings (P/E) Ratio, Net Asset Value (NAV) per share, and other liquidity ratios. Timely submission of these reports is critical for investors who rely on this data to make informed decisions.
In addition to scheduled financial reports, NEPSE mandates the immediate disclosure of any “sensitive information” or major corporate actions that could impact a company’s share price. This includes decisions regarding cash dividends, bonus shares, rights shares, or new share issuances. Companies must notify NEPSE at least seven days prior to or before the trading session begins, providing details such as the ratio of bonus shares, the number of new shares, or the total amount of cash dividends. The same information must also be made available on the company’s official website. This prompt disclosure is essential to prevent insider trading and ensure all investors have equal access to market-moving information.
Furthermore, listed companies must immediately notify NEPSE of any significant changes in their business or financial condition, major asset transactions valued at NPR 100 million or more, or changes in key personnel like the CEO, CFO, auditors, or members of the Board of Directors. Any potential or ongoing legal cases that could affect the company must also be reported without delay.
Specific Rules for Mutual Funds and Corporate Actions
The directive extends specific reporting requirements to mutual funds and collective investment schemes. Fund managers are now required to submit monthly reports on their Net Asset Value (NAV) and investment positions within 15 days of the month’s end. This provides greater transparency for unit holders and allows for more frequent monitoring of fund performance.
For major corporate restructuring events like mergers, acquisitions, or spin-offs, companies must immediately notify NEPSE on the same day or before the trading session begins. This ensures that the market is aware of significant changes in the company’s structure, which can have a profound effect on its valuation and future prospects. Similarly, any change in a company’s registered office address must be reported immediately.
Another important rule concerns shareholding disclosures. If any individual or institution acquires 5% or more of a company’s shares, NEPSE must be notified promptly. This is a crucial measure for tracking major changes in ownership and preventing hostile takeovers or market manipulation.
Compliance, Penalties, and Market Integrity
NEPSE’s directive stresses that compliance is not optional. The exchange will enforce penalties and take regulatory actions against companies that fail to adhere to the rules. The order is part of NEPSE’s broader effort to build a more transparent and trustworthy capital market.
The directive underscores that timely and transparent disclosures are the cornerstones of a reliable market. By compelling companies to submit information on time and through proper channels, NEPSE aims to ensure financial discipline, protect the interests of all shareholders, and maintain the overall integrity of the market. This renewed focus on enforcement is expected to increase investor confidence and foster a more stable trading environment.
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