The Nepal Stock Exchange (NEPSE) is facing continuous downward pressure as a massive surge in share supply heavily outweighs current market demand. Market analysts and investors emphasize that for NEPSE to achieve sustainable growth and stability, the focus must shift toward boosting demand rather than continuously inflating supply.

The market is currently navigating a multi-front supply surge. Beyond the steady stream of initial public offerings (IPOs), rights shares, and bonus shares, the market is now bracing for the expiration of lock-up periods for several major companies. Without adequate buying liquidity to absorb these incoming shares, stock values are struggling to recover, ultimately weakening the broader market sentiment.

The Upcoming Lock-Up Expirations

Over the next 10 days, millions of previously restricted shares are scheduled to become eligible for public trading. By the end of Ashad, more than 74.68 million units of shares from four major companies will hit the secondary market. These shares belong to promoters, local residents, and company employees who are finally free to liquidate their holdings.

The breakdown of the upcoming share influx includes:

Investor Outlook: Market participants widely anticipate that injecting such a massive volume of shares over a short window will trigger severe selling pressure, potentially forcing a sharp correction in individual stock prices and dragging down the overall index.