Mutual Funds in Nepal
With the flotation of NCM Mutual Fund in 2050 B.S. (1993 A.D.), the Nepali market entered into the era of mutual funds. It was an open-ended scheme with a collected fund of just Rs. 100 million. These days, merchant bankers are coming up with funds 5 to 10 times larger than that, which have become a pivotal part of the Nepali stock market.
Mutual Fund Schemes Trading in The Stock Market in 2021
Currently, there are 26 mutual fund schemes running in the Nepali stock market (23 closed-end and three open-end mutual fund schemes). Three mutual funds are upcoming and are in the pipeline to be approved. These mutual funds have to be approved by SEBON (Securities Board of Nepal) first to publish the offer letter and accept the funds from the general public as initial public offerings. When the fund units are allotted, they are listed in NEPSE (Nepal Stock Exchange), where they can be freely bought and sold. NEPSE is Nepal's only stock exchange market.
List of Mutual Funds in Nepal
- Global IME Samunnat Scheme-1 (GIMES1)
- NIBL Sambriddhi Fund-1 (NIBSF1)
- Nabil Equity Fund (NEF)
- NMB Hybrid Fund L-1 (NMBHF1)
- NIBL Pragati Fund (NIBLPF)
- Laxmi Equity Fund (LEMF)
- Siddhartha Equity Fund (SEF)
- Sanima Equity Fund (SAEF)
- NIC Asia Growth Fund (NICGF)
- Citizens Mutual Fund-1 (CMF1)
- Nabil Balanced Fund-2 (NBF2)
- Citizens Mutual Fund-2 (CMF2)
- NMB 50 Fund (NMB50)
- Siddhartha Investment Growth Scheme - 2 (SIGS2)
- NIC Asia Balance Fund (NICBF)
- Sunrise First Mutual Fund (SFMF)
- NIBL Sahabhagita Fund (NIBLSF) | Open-ended
- Laxmi Unnati Kosh (LUK)
- NIC Asia Dynamic Debt Fund | Open-ended
- Sanima Large Cap Fund (SLCF)
- Kumari Equity Fund (KEF)
- NIBL Sambriddhi Fund-2 (NIBSF2)
- Prabhu Select Fund (PSF)
- NIC Asia Select-30 (NICS30)
- RBB Mutual Fund-1 (RBBMF1)
- Siddhartha Systematic Investment Scheme (SSIS) | Open-ended
Recently Matured Mutual Funds in Nepal:
- Siddhartha Investment Growth Scheme-1 (SIGS1)
- Nabil Balanced Fund-1 (NBF1)
- NMB Sulav Investment Fund-1 (NMBSF1)
- Siddhartha Equity Oriented Scheme (SEOS)
- Laxmi Value Fund-1 (LVF1)
Upcoming Maturities:
- NIBL Sambridhhi Fund-1 (matures in January 2022)
Subsidiaries of Commercial Banks
These mutual funds are managed by merchant bankers (fund managers) and sponsored by a commercial bank ('A' class banks licensed by Nepal Rastra Bank). Only those merchant bankers that are direct subsidiaries of commercial banks can float and manage mutual funds in Nepal. As such, mutual fund companies are full subsidiaries of commercial banks.
List of Mutual Fund Companies:
| Mutual Fund Companies in Nepal |
|---|
1. NIBL Ace Capital (after merger of NIBL Capital Markets with Ace Capital) |
2. Laxmi Capital Market |
3. Global IME Capital (previously known as Elite Capital) |
4. Siddhartha Capital |
5. NMB Capital |
6. Nabil Investment Banking Limited |
7. CBIL Capital |
8. Prabhu Capital (previously known as Growmore Merchant Banking) |
9. Civil Capital Markets |
10. NIC Asia Capital |
11. Sunrise Capital (previously known as NIDC Capital Markets Ltd.) |
12. Kumari Capital |
13. RBB Merchant Banking Limited |
1. Siddhartha Investment Growth Scheme-1
Fund Size: Rs. 500 Million
Maturity Period: 5 Years
Expires: December 2017
Highest NAV: Rs. 34.329 on July 29, 2016
SIGS-1 was the first mutual fund scheme in Nepal to conceptualize the industry after the introduction of the mutual fund regulatory act in 2010. It started with an initial fund of Rs. 500 million (Rs. 50 Crores) and is a close-end scheme that expires in December 2017. SIGS-1 is a more risky scheme in the sense that it is more focused on a higher possible capital appreciation. As such, it has not allotted any money in "safe" investments like fixed deposits.
The fund that started with just Rs. 500 million has invested a total of Rs. 1.12 billion in stocks and has Rs. 50 million in dividends, rights offerings and initial offerings.
Its NAV reached the highest level on July 29, 2016, at Rs. 34.329, which is more than a three-fold jump from its par value of Rs. 10 only. It has provided 64.5% in cash dividends so far: 30% in FY 2015-16, 15% in FY 2014-15, 15% in FY 2013-14, and 4.5% in FY 2012-13.
2. Siddhartha Equity Oriented Scheme
Fund Size: Rs. 1 Billion
Maturity Period: 5 Years
Expires: July 2019
Highest NAV: Rs. 18.95 on July 29, 2016
After the successful management of SIGS-1, Siddhartha Capital came up with another close-end mutual fund scheme in 2014. It has provided 16% in cash dividend so far from the profit it made up to the end of FY 2015-16. The fund that started with an initial pool of Rs. 100 Crores has already invested Rs. 113 Crores in listed stocks, Rs. 10 Crores in fixed deposits, and Rs. 2.4 Crores in bonds and debentures.
3. NMB Sulav Investment Fund-1
Fund Size: Rs. 750 Million
Maturity Period: 5 Years
Expires: September 2019
Highest NAV: Rs. 20.36 on July 29, 2016
As of December 2016, the investment of NMBSF-1 has jumped up to Rs. 963.3 million from an initial fund of Rs. 750 million. It has set aside Rs. 75 million in fixed deposit accounts and Rs. 14 million in bonds and debentures. So far, it has provided 20% cash dividend from the profit it earned up to the end of FY 2015-16.
4. NIBL Sambriddhi Fund-1
Fund Size: Rs. 1 Billion
Maturity Period: 7 Years
Expires: December 2021
Highest NAV: Rs. 18.32 on July 29, 2016
With an investment of Rs. 1.18 billion in stocks of listed companies, Rs. 100 million in fixed deposits, Rs. 33 million in bonds and debentures, and Rs. 78.61 million in public offerings, NIBSF-1's total investment has reached over Rs. 1.39 billion. That is a massive rise from the initial collection of Rs. 800 million. As such, it has also offered cash dividends to its scheme holders: 15% of the profits it had earned up to the end of fiscal year 2015-16.
5. Nabil Balanced Fund-1
Fund Size: Rs. 750 Million
Maturity Period: 5 Years
Expires: April 2018
Highest NAV: Rs. 30.71 on July 29, 2016
Nabil Balanced Fund-1 (NBF1) had reached a height of Rs 30.71 as compared to its par value of Rs. 10. It has an impressive Rs. 1.47 billion in investment, which is a significant return on its initial Rs. 600 million fund. It has also set Rs. 75 million in fixed deposits.
It has provided 30% cash dividend in FY 2015-16 and 14% in FY 2013-14. It had pledged 5.5% in the middle of FY 2013-14, but this issuance was suspended by the regulatory authority as dividends can only be declared from the profits made in a whole fiscal year.
6. Laxmi Value Fund-1
Fund Size: Rs. 500 Million
Maturity Period: 5 Years
Expires: March 2020
Highest NAV: Rs. 16.11 on July 29, 2016
LVF1 is the first mutual fund scheme sponsored by Laxmi Bank and managed by Laxmi Capital. It has saved up Rs. 80 million in fixed deposits and has invested Rs. 396 million in stocks. The fund, which started in 2015, has already provided 25% of the profit it earned in FY 2015-16.
The merchant banker (Laxmi Capital) had proposed to invest approximately 58% in equity or equity-based instruments (like stocks), 38% in fixed income securities (like fixed deposits schemes), and the rest of the fund would be at call.
7. Global IME Samunnat Scheme-1
Fund Size: Rs. 1 Billion
Maturity Period: 5 Years
Expires: February 2021
GIMES1 initially published an offer for a fund of Rs 800 million, but when it was oversubscribed, the fund was declared to be worth Rs. 1 billion. It posted a net loss of Rs. 33 million in November 2016. It has invested Rs. 676 million in stocks and Rs. 100 million in fixed deposits as per its financial statement published on November 30, 2016.
8. NMB Hybrid Fund L-1
Fund Size: Rs. 1 Billion
Maturity Period: 5 Years
Expires: October 2021
Highest NAV: Rs. 10.07 on December 16, 2016
NMB Hybrid Fund L-1 is a closed-end mutual fund scheme managed by NMB Capital and sponsored by NMB Bank. It collected funds in September 2016 and has made investments worth Rs. 2 million in initial public offerings. Rs. 100 million has been set aside as fixed deposits in various bank accounts to garner interest. Its NAV at the end of November was Rs. 10.02 (par value of Rs. 10).
9. Nabil Equity Fund
Fund Size: Rs. 1.25 Billion
Maturity Period: 7 Years
Expires: November 2023
Similar to Global IME Samunnat Scheme-1 and NMB Hybrid Fund L-1, Nabil Bank's newest mutual fund scheme, Nabil Equity Fund, was also oversubscribed. Hence, with respect to the acting law governing mutual fund schemes, its fund size was increased from Rs. 1 Billion to Rs. 1.25 Billion. As such, 125 million units were allotted to the subscribers.
Until the end of November, it had invested Rs. 47.14 million in shares of companies listed in the Nepal Stock Exchange. Likewise, it has invested Rs. 501 thousand in stocks of unlisted companies (IPO) and has saved up Rs. 70 million in fixed deposit accounts to garner regular interest.
10. NIBL Pragati Fund
Fund Size: Rs. 750 Million
Maturity Period: 7 Years
Expires: December 2023
NIBL Capital Markets recently floated Rs. 600 million worth of this particular mutual fund scheme. Its paid-up value per script also stands at Rs. 10 per unit. Since it was oversubscribed, its fund size also increased by 25% to Rs 750 million.
It is trading in NEPSE with the stock symbol NIBLPF.
Upcoming Mutual Fund Schemes in Nepal 2021
| Name | Initial Fund Size | Fund Manager | Status |
|---|---|---|---|
Global IME Balanced Fund - 2 | Rs 1.20 Billion | Global IME Capital Limited | In SEBON Pipeline |
NMB Saral Bachat Fund - E | Rs 1 Billion | NMB Capital Limited | In SEBON Pipeline |
This article is accurate and true to the best of the author’s knowledge. Content is for informational or entertainment purposes only and does not substitute for personal counsel or professional advice in business, financial, legal, or technical matters.
Questions & Answers
Question: I am a Nepali Citizen but currently live in the USA. Can I buy IPO of upcoming mutual funds as a Nepali? If yes, what is the process to buy mutual funds?
Answer: Yes, you can buy IPO of mutual funds. There is a service called MeroShare, which allows investors to buy IPO shares online. Currently, there are no IPOs being issued. When they are, they will be listed on the webpage and anyone can apply online.
© 2016 Roberto Eldrum
Janak Khadka on August 28, 2020:
I interested for invest in mutual fund. Could I invest? Please suggest me.
Bikram Singh Mahara on August 24, 2020:
i am interesed to invite in mutual funds WHAT is the process.can i hell ME Sir
Pratiksha kala rai on July 19, 2020:
Interested
Dhiraj sah on May 14, 2020:
I am interested to invite in mutual fund what is the process...
Rishab karki on May 13, 2020:
What are the procedures to buy mutual funds?
Mohan kumar tamang on April 24, 2020:
I am interested to invest in mutual fund
Nur on April 20, 2020:
I am Nepali and I live in UAE.iwant to invest in index in Nepal how can I invest.please help me
Padam Bahadur Chand on March 25, 2020:
Which option is better for investment in Mutual funds? either IPO or 2nd market.
Deepak kumar singh on December 13, 2019:
I am also intrested to mutual found.
Deepak Lamichhane on December 07, 2019:
I am also intrested to mutual fuund. Which mutual fund is ready to lunched? please inform me.
Bishawambhar on November 18, 2019:
Sir i would like to contact with mutual fund manager so i can get help ,can you help me
sandipsunar@yahoo.com on October 25, 2019:
which is the best fund for long time investment ?
durga on October 14, 2019:
I want to invest in mutual fund global ime some information please
Ashok limbu on October 10, 2019:
I want to investment in mutual funds global ime...some information please
Dipak chaudhary on October 03, 2019:
I want alsto invest in mutual funds
Bunty on August 22, 2019:
Can NRN invesr in mutal fund.
Shiva nepali on July 31, 2019:
I am looking forward it..When I can invest here but please tell me about sip calculater .... Does sip calculater work true or scame
Binti bishwakarma on June 15, 2019:
Me ,now I want to invest when can I ? How to know the opening date ? Is there any bank to invest right now...?
Pushpen maharjan on April 28, 2019:
i want some information regarding nepalese investors decisions regarding mutual funds for may thesis work.pls
Partap on April 08, 2019:
I am nepali citizen but currently I live in india I want to invest in mutul funds so please suggest me how to apply mutual funds
sagar on April 08, 2019:
I what to invest in mutual funds tell me how can i apply for mutwal funds
hari chaudhay on March 31, 2019:
can you tell me what the investing sysem in multul fund ? primary,secondry system or other system like daily or monthly deposit?
Rojendra on March 03, 2019:
I want to invest in mutual fund please suggest me how can apply
Degindra Karki on November 21, 2018:
I interested for invest in mutual fund. Could I invest? Please suggest me.
Sushil on September 23, 2018:
I want invest in NMB Sulav Investment Fund-1. How can I invest please suggest me.
Najir rain on July 08, 2018:
I want to invest in mutual fund please suggest me how can apply
Surendra Adhikari on May 08, 2018:
How can the we apply in Mutual Fund through DMAT account? And how do we know about it?
anupa thapa on May 07, 2018:
how to apply mutual fund
Sanjay K.c on February 04, 2018:
if NBF give 30 % cash dividend then how to calculate total cash receive by investor if he/ she holds 500 shares of NBF?
Subash Kumar Shrestha on January 24, 2018:
How 2 invest and wat r the profits calculations
Lakpa tamang on October 07, 2017:
How to invest in nabil mutual funds.
Luxmi bahadur Budha on October 03, 2017:
I want invest to mutual fund please advise me
Altaf Miyan on April 12, 2017:
what sum of money should i have to invest on mutual fund
