DETERMINANTS OF FURTHER PUBLIC OFFERING AND STOCK PRICE BEHAVIOUR IN NEPAL STOCK EXCHANGE

Abstract

The concept of further public offering is in growing phase in stock market scenario. But still there are many areas which have not been covered by further public offering on stock price behaviour. The lack of awareness among people about the stock market and inability of banking sectors to attract people with new and different scheme and it is also very challenging to know the customers investment pattern interms of stock price fluctuation . The objective of the study was to empirically examine the impact of further public offerings factors and their influence on stock price behavior pattern of five commercial bank listed in Nepal Stock Exchange. This study investigates the further public offering determinants including Cash Dividend Ratio (CDR), Market to Book Value Ratio (MB) and Leverage Ratio (LR) on the Stock Price Behaviour (SPB) of five commercial bank listed in Nepal Stock Exchange. The association and impact of determinants of further public offering have been assessed by descriptive and regression model (20 observation) of commercial banks out of 5 commercial banks. The secondary data has been used that covered a period of thirteen years (2010/2011-2022/2023). This study finds that there is the significant and negative correlation between Cash dividend ratio (CDR) on Stock price behavior (SPB). This study also finds that Market to book value ratio (MB) have significant and positive impact on Stock Price Behaviour (SPB) but Leverage ratio (LR) do not give any significant influence on Stock Price Behaviour (SPB). The study suggested a need for enhancing the dividend scheme of commercial banks and also need to diversify the investment in different portfolio to maintain the prevailing profitability position of the stock which fosters financial stability and investors growth.