The government's total CGT revenue shrank from Rs 936.17 million in Baishakh to Rs 431.80 million in Jestha, a net drop of roughly Rs 50.44 million.
Shift in Investor Dynamics
The data highlights a clear divergence between retail momentum and institutional strategy during market downturns.
- Retail Short-Term Traders Retreat: Short-term individual investors (holding shares for less than a year, taxed at 7.5%) traditionally dominate the Nepali market. However, tax revenue from this segment crashed by 70.07%, dropping from Rs 707.69 million in Baishakh to just Rs 211.84 million in Jestha. This indicates either heavily reduced trading activity or a lack of profitable exit windows.
- Long-Term Investors Standardize: Long-term individual investors (holding shares for over a year, taxed at 5%) showed a modest decline. CGT from this group dipped by 14.70% to Rs 158.18 million.
- Institutional Resilience: In contrast to retail panic, institutional investors (taxed at 10%) increased their market activity. Corporate CGT collection surged by 43.56% to reach Rs 61.78 million, signaling that institutions took advantage of the slowing market to rebalance portfolios and lock in specific gains.
Net Profit Breakdown: Who Earned What in Jestha?
Despite the steep month-on-month decline, investors still walked away with a collective net profit of Rs 6.61 billion in Jestha (down from Rs 13.57 billion in Baishakh).
Jestha Net Profits by Category:
├── Individual Long-Term (5% Tax) ─── Rs 3.16 Billion
├── Individual Short-Term (7.5% Tax) ─ Rs 2.82 Billion
└── Institutional (10% Tax) ────────── Rs 617.83 Million
Note: In Baishakh, short-term day traders and swing traders alone accounted for over Rs 9.43 billion of the market's total profits, contrasting sharply with their subdued Rs 2.82 billion performance in Jestha.
Cumulative Fiscal Year Performance
Despite the sluggishness in Jestha, the broader fiscal year revenue remains strong. Total CGT collected from the equity market has crossed Rs 9.54 billion up to mid-June of the current fiscal year 2082/83, rising from Rs 9.11 billion recorded as of mid-Baishakh.
Market Outlook
Analysts view these figures as a sign of temporary weakness in retail morale, driven by market confusion and selling pressure. While individual traders stepped back, the aggressive profitability of institutional firms suggests the secondary market is gradually maturing, with professional capital absorbing the volatility left behind by exiting retail participants.
