On October 1, 2026, the Securities Board of Nepal sent the Nepal Stock Exchange a directive that treats the floods as a market event, not only a natural disaster. SEBON’s Regulation Department, writing under letter number धि.ब.सि.धि.व्य.नि.शा. २०८३/८४ and dispatch number 558, signed by Executive Director Vinaya Dev Acharya, invoked Section 64(1) of the Securities Act and ordered the exchange to identify every listed company the floods may have damaged, collect a thirteen-point impact report from each, publish the findings, and place the affected shares under special trading surveillance. Posted to SEBON’s circulars page the same day, it is the regulator’s first systematic response to the flood damage now working its way through listed-company balance sheets.
The circular’s context paragraph names the damage without hedging. Recent floods and natural disasters in Nepal’s Himalayan and riverine areas have damaged operating and under-construction hydropower projects, with the Trishuli and Bhotekoshi river systems singled out, along with transmission structures and other physical infrastructure. The market has already seen the first company-level filings: Sayapatri Hydropower disclosed that flood damage to its transmission line had halted its power generation, Daramkhola Hydro filed its own flood notice, and Mountain Energy Power reported an obstruction in power transmission, all carried on NEPSE’s disclosure board. Those arrived one company at a time, through the exchange’s ordinary disclosure flow. The directive says, in effect, that the ordinary flow is not enough.
The list comes first, and it does not exist yet
The first operative order is the foundation for everything else. NEPSE must “immediately” (तत्काल) prepare a detailed list of listed companies that may be directly or indirectly affected by the natural disaster and inform the Board. The original Nepali is explicit: “प्राकृतिक विपदबाट प्रत्यक्ष वा अप्रत्यक्ष रुपमा प्रभावित हुन सक्ने सूचीकृत कम्पनीहरुको विस्तृत सूची तत्काल तयार गरी बोर्डलाई जानकारी गराउने।” Two words do the heavy lifting. “Directly or indirectly” reaches past the hydropower companies whose plants are damaged to every listed company the disaster touches through lending, insurance, contracting, or supply chains. And the list does not exist yet. Until NEPSE compiles it, no investor, no analyst, and not the exchange itself has an authoritative map of the flood’s footprint on the listed universe.
Thirteen questions every affected company must answer
The second order is where the directive turns forensic. From every affected company, NEPSE must collect a thirteen-point report: the name and location of the affected project; the date and nature of the disaster; the preliminary physical damage; whether power generation has halted or been affected; the quantum of generation capacity affected; damage to human resources; the impact on transmission and distribution infrastructure; whether the project is insured; whether an insurance claim has been filed; the preliminary financial impact; the estimated time to resume operations; the possible impact on bank loans and debt-service capacity; and the immediate steps management has taken. That report must then be disclosed publicly, through the companies’ own official channels and NEPSE’s information system. For an investor, this is the document that converts rumor into arithmetic: megawatts lost, rupees at risk, months to recovery, loans under strain.
Surveillance on the shares, not just the companies
The third order shifts the lens from the companies to the market. NEPSE must keep the securities trading of affected companies under special surveillance and continuously monitor five things: unusual price movements; abnormal trading volumes; unusual buy or sell orders; unusual trading before material information is made public; and any other activity affecting market fairness and transparency. The circular states the mandate plainly: “प्रभावित कम्पनीहरूको धितोपत्र कारोबारमा विशेष निगरानी राखी देहायका गतिविधिको निरन्तर अनुगमन गर्ने।” Disasters manufacture information asymmetry. The people standing beside a damaged powerhouse know days before the shareholders do, and SEBON is telling the exchange to watch for anyone trading in that gap.
A playbook for the next disaster, written during this one
The fourth order looks past this flood. NEPSE must prepare procedures governing information flow and the suspension and re-commencement of trading, accounting for the short- and long-term impacts of natural disasters, accidents, fires, earthquakes, and other extraordinary events on listed companies, drawing lessons from the current episode. Nepal’s market has no standing disaster-trading playbook; each past shock has been handled with the exchange’s general powers and ad hoc judgment. SEBON is ordering the playbook written now, while the lesson is fresh. The fifth order closes the loop: NEPSE must report its progress on all of the above, and any abnormal market activity it detects, to the Board on a regular basis.
What to watch now
What the directive omits is as telling as what it contains. There is no calendar deadline, only “immediately” for the company list and “regularly” for progress reports. No penalties are spelled out for companies that disclose slowly or thinly. And the single most consequential document in the exercise, the list of affected companies, is to be compiled by the exchange rather than volunteered by the market. The open question is the one the directive was written to answer: which listed companies are damaged, and by how much? Until NEPSE’s list and the thirteen-point reports arrive, the market keeps trading on the same incomplete information the circular was issued to fix. That is the honest state of play, and it is where this story resumes.
This article is research and education, not investment advice. Directive details are summarized from SEBON’s official three-page circular “Circular to Stock Exchange 2083.05.15” (dispatch no. 558, dated 2083/05/15), posted on sebon.gov.np on October 1, 2026; verify the final legal text before acting.