1. Capital Markets Scenario inNepal

2. History Started with the floatation of shares by Biratnagar Jute MillsLtd. and Nepal Bank Ltd. in 1937 Introduction of Company Act in 1964 opened doors forcompanies to go public Securities Exchange Center Ltd. was established in 1976 tosystemize the trading activities Securities Exchange Center was converted into Nepal StockExchange in 1993 13th January 1994: Nepse (Nepal Stock Exchange) opened itstrading floor for members and market intermediaries, such asbroker, market makers 3. Current Scenario Recent trends show active participation ofindividuals and institutions towards Capital Markets In last 6 years, investors have put in fresh investmentwhich is more than 50% of total IPO investmentmade in Nepal till date The annual turnover in Nepse has increased multiplefolds in last couple of years 4. Details of Listed SecuritiesCategory Number of Securities Listed SharesCommercial Banks 30 693,929,440Development Banks 96 264,010,818Finance Companies 58 165,539,288Insurance Companies 22 64,509,282Hotels 4 54,041,060Hydropower Companies 6 63,317,222Manufacturing & Processing 18 43,206,235Others 2 150,491,285Trading Companies 4 1,169,461Government Bond 16 224,000,000Corporate Debenture 19 7,597,370Preferred Stock 2 4,121,750Mutual Funds 2 125,000,000 5. Securities Issued4.72 2.63 3.34 4.1914.715.68 10.4916.6124.93 23.43101.74171.76110.4669.9530.11108.2059.60Amount of Securities Issued (in USD million)*Exchange Rate as on 18 August 2014: 1 USD = NPR97.98 6. Average Daily TransactionVolumeAverage Daily Transaction (In USD)*Exchange Rate as on 18 August 2014: 1 USD = NPR97.9823,251215,217 111,034 230,428576,4861,063,647686,824307,094 327,900755,6641,549,4134,021,4042002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 7. Market StructureCommercial Banks,34.58%Development Banks,Preferred Stock, 0.31%Mutual Fund, 0.47%Others, 0.42%Hydropower, 14.57%Trading, 0.02%Hotel, 4.27%Manufacturing &Processing, 0.74%Finance Companies,2.83%Insurance Companies, 10.10%28.91%Promoter Share, 2.78% 8. Capital Markets in Nepal Current Market Capitalization As of August 18, 2014: NPR 1034.548 billions, i.e. USD 10.558 billions Market Capitalization to GDP GDP (2013/14) as per NRB Monetary Policy 2014-15: NPR 1724.59billion, i.e. USD 17.60 billion Bank Loans to GDP As of May 2014, Total Loans/Credit by Banks and Financial Institutions:NPR 1087.66 billion, i.e. USD 11.10 billion Annual Turnover of Capital Market to GDP Annual Turnover: NPR 50.04 billion, i.e. USD 510.72 million*Exchange Rate as on 18 August 2014: 1 USD = NPR97.98 9. Price to Earnings Ratio forDifferent SectorsMarket Multiples 2014Average EPS Average PE( Price as of July 3,2014)Commercial Banking Sector 34.29 29.95Insurance Company (Life) 70.60 44.59Insurance Company (Non-Life) 35.93 20.90Hydropower Sector 44.20 43.76Nepal Telecom 76.49 7.84 10. Market Value to Paid-Up ValueRatioSectors Paid-Up Value*Exchange Rate as on 18 August 2014: 1 USD = NPR97.98(in USD)Market Value to PaidUpValue RatioCommercial Banks 708,235,803 8.57Development Banks 269,453,784 3.22Finance Companies 168,952,121 3.96Insurance Companies 65,839,235 18.83Hotels 27,518,580 15.30Hydropower Companies 64,622,598 12.54 11. Sources NRB Monetary Policy (2014-15) Nepal Stock Exchange Monthly Report Ashad Nepal Stock Exchange Data on Nepse, ListedSecurities and Broker List NRB Current Macroeconomic Situation Tables Kriti Capital Internal Financial Database 12. www.kriticapital.com.np@KritiCapitalwww.facebook.com/KritiCapitalwww.linkedin.com/company/kriti-capital-&-investments-ltd