Himal Press 
KATHMANDU: With the Nepal Stock Exchange (Nepse) index under pressure, investors are increasingly turning to corporate debentures in the secondary market largely due to their attractive fixed returns and upcoming interest payouts ahead of the end of the fiscal year.
The daily trading data of Nepse shows corporate debentures accounted for more than half of the total market turnover of Rs 8.41 billion on Tuesday.
Corporate debentures worth Rs 4.76 billion changed hands on Tuesday. Similarly, debentures worth Rs 3.70 billion were trading on Monday and Rs 3.71 billion last Friday. Total debentures turnover stood at Rs 1.58 billion on July 9 and Rs 2.08 billion on July 8.
This shows sustained investor demand for debentures in recent trading sessions.
Market analysts, however, say the surge in debenture trading is largely seasonal. As the fiscal year 2025/26 draws to a close, debenture holders become eligible to receive annual interest payments, which make debentures more attractive than equities at a time when the broader market is bearish.
The other reason behind the growing preference for debentures is the steady decline in bank deposit rates. With commercial banks now offering deposit interest rates of around 2.75 percent, many institutional investors have shifted funds to corporate debentures which offer fixed coupon rates of as high as 11%.
Tuesday’s trading reflected that trend. Kumari Bank Debenture 2089, which carries an 11% coupon rate, topped the turnover chart with transactions worth Rs 623.9 million. The debenture, with a face value of Rs 1,000, closed at Rs 1,290 per unit.
The NIMB Debenture 2090, which carries a coupon rate of 10%, was next on the list.
Corporate debentures also dominated the list of the market’s most actively traded securities, accounting for nine of the top 10 stocks by turnover on Tuesday.
They also led the gainers’ chart, with Kamana Sewa Bank Debenture 2087, offering a coupon rate of 9%, topping the list with a 10.22% gain.
