You’ve probably heard that you can make money in NEPSE. Many have earned well, some have lost. But with the right knowledge and strategy, the Nepali stock market can be a great tool for long-term wealth creation.
This guide will take you from absolute zero – DEMAT account, MeroShare, IPO, secondary market, basic analysis, and risk management – all in simple English. No technical jargon to scare you off.
1. What is the Stock Market? (Simple Definition)
A stock market is a place where companies sell small pieces of themselves (called shares) to the public. When you buy a share of a company, you become a small owner of that company. If the company makes a profit, you may receive a dividend. If the company’s value increases, your share price also rises.
In Nepal, the regulator is SEBON (Securities Board of Nepal), and the exchange is NEPSE (Nepal Stock Exchange).
2. What Do You Need to Start Trading Shares?
You need three main things:
| # | What? | Why? |
|---|---|---|
| 1 | DEMAT Account | To hold your shares in electronic form |
| 2 | MeroShare Account | To apply for IPOs and manage holdings |
| 3 | Bank Account (C-ASBA) | To link funds for IPO applications |
Easy tip: Visit any bank branch – they will open both DEMAT and MeroShare for you at the same time.
3. Step 1 – How to Open a DEMAT Account?
Without a DEMAT account, you cannot buy or sell shares.
Required documents:
Citizenship (copy)
2 passport-size photos
PAN card (optional but recommended)
First page of bank passbook copy
Process:
Go to any bank that offers DEMAT services (e.g., NMB, NIC Asia, Global IME, Prabhu, Siddhartha).
Fill out the form and submit documents.
The bank will give you a DP ID and Beneficiary Account Number – very important.
Within 1-2 days, your account will be ready. The bank will provide a username & password for MeroShare.
Cost: DEMAT opening fee is around Rs. 200–500 (one-time). Annual maintenance charge (AMC) is around Rs. 100–200.
4. Step 2 – Activate Your MeroShare Account
Once your DEMAT is opened, you get login credentials for MeroShare. To fully activate:
Go to meroshare.cdsc.com.np
Login with the provided username & password.
Change your password immediately.
Link your C-ASBA bank account – this lets money be debited directly when you apply for IPOs.
Verify that your DEMAT number and DP ID are correct.
Now you are ready to apply for IPOs and view your portfolio.
5. Step 3 – Open a Broker/Trading Account (for Secondary Market)
If you want to buy/sell already-listed shares (secondary market), you need a trading account with a broker firm.
There are 70+ brokers in NEPSE (e.g., Nepal Investment Bank, Nabil Bank, Sunrise Capital). How to choose?
Near your location – for urgent work.
Commission rate – typically 0.3% to 0.5%.
Mobile app quality and service.
To open a trading account, you need similar documents as DEMAT. The broker will give you a login ID for their trading software (TMS).
Note: For beginners, just applying to IPOs only needs DEMAT+MeroShare. For secondary market, you must have a trading account.
6. How to Invest Money in the Stock Market?
(a) Primary Market – IPO (Initial Public Offering)
What: A company sells its shares to the public for the first time.
How to apply: Login to MeroShare, select the IPO, enter the number of lots (minimum 10 shares, often Rs. 1000 minimum).
It’s a lottery: Not everyone gets allotment. But applying is free.
Benefit: IPOs often (but not always) list at a premium.
(b) Secondary Market – Buying/Selling on NEPSE
You buy already-listed shares (e.g., NABIL, PRABHU, SHIVAM).
Prices move up/down on the NEPSE screen.
Requires a trading account + broker.
7. How Much Money Do You Need to Start?
For IPO application: Minimum Rs. 1,000 (10 shares x Rs. 100 face value) – though some IPOs have lower face value.
For secondary market: You can start with Rs. 5,000–10,000, but after commission & taxes, very small amounts yield little profit. Rs. 20,000–50,000 is a comfortable starting point.
Important: Only invest money you can afford to lose without affecting your daily life. Keep an emergency fund separate.
8. Fundamental Analysis – Which Share to Buy?
Many new investors buy based on friends’ tips or WhatsApp groups – that’s risky. Check these 5 things instead:
| Metric | What to look for | Why it matters |
|---|---|---|
| EPS (Earnings Per Share) | Profit per share | Higher EPS = better profitability |
| P/E Ratio | Share price ÷ EPS | Low P/E suggests undervaluation |
| Book Value | Assets – Liabilities | Buying below book value is a margin of safety |
| Dividend History | Regular dividends | Stable companies pay consistent dividends |
| Promoter Holding | % held by promoters | High promoter holding signals confidence |
You can find this data on NEPSE website, Sharesansar, or Merolagani.
9. How to Buy and Sell (Step-by-Step)
Assuming you have a broker/trading account:
Login to your TMS (Trading Management System).
Select “Buy”.
Search for the company script (e.g., NABIL).
Enter price and quantity.
Place the order. The system will match when a seller accepts your price.
To sell, place a “Sell” order similarly.
Tip: Always use a limit order – set the exact price you want. Never use a market order (it may execute at a weird price).
10. Common Mistakes to Avoid
❌ Herd mentality: Buying whatever everyone else is buying – could be a pump & dump.
❌ Not taking profits: Have a target; don’t be greedy.
❌ Panic selling when price drops: Good companies recover over time.
❌ Putting all money into one share: Diversify across banks, hydro, insurance, manufacturing.
11. Investment Strategies (Nepal Context)
| Strategy | Time Horizon | Preferred Sectors |
|---|---|---|
| Long-term | 5-10 years | Strong brands, regular dividends (banks, hydro) |
| Medium-term | 1-3 years | Seasonal, growth sectors (hotels, insurance) |
| Short-term / Trading | Days to weeks | High liquidity, news-driven |
For beginners, long-term is best. Lower stress and you benefit from compounding.
12. Risk Management (Most Important)
Every investment carries risk. How to control it?
Use a stop-loss: When you buy, decide a price (e.g., 10% below purchase) at which you will sell automatically.
Invest only in what you understand: Don’t buy hydropower if you don’t know the sector.
Review your portfolio every 3-6 months: Remove weak companies.
13. Frequently Asked Questions
Q1: Can minors buy shares?
A: Yes, but through a guardian’s DEMAT and MeroShare account.
Q2: After selling shares, when does money reach my bank?
A: NEPSE follows T+2 settlement – money arrives in 2 days.
Q3: Can I invest from abroad?
A: Yes, as long as your DEMAT is active. You may need to give Power of Attorney to someone in Nepal.
Q4: Where can I see live NEPSE prices?
A: nepalstock.com, nepalipaisa.com, sharesansar.com.
14. Useful Resources
MeroShare official: meroshare.cdsc.com.np
SEBON: sebon.gov.np
NEPSE data: nepalstock.com
Analysis platforms: Merolagani, Sharesansar, MeroShareNepal (your own site!)
Conclusion
Investing in the stock market is a journey, not a race. If you start small today, keep learning, and stay disciplined, the market can reward you handsomely over time.
Remember:
Do your own research.
Trust your decisions, not rumours.
Think long-term.
Your move: Go to a bank today and open a DEMAT account. Every big journey begins with a small step.
