THE PREVAILING FACTORS THAT DETERMINE THE GROWTH AND PROSPECTS OF THE NEPALESE CAPITAL MARKET

Abstract

This study aims to examine the development and future prospects of Nepal's capital markets. This study's particular goals are to evaluate the effects of EPS, DPS, PER, CRR, and CAR on the MVPS of development banks in Nepal. Descriptive and informal comparative research designs were used in this study. The foundation of this work is quantitative in character. Three development banks were selected as a sample for the secondary data collection: Lumbini Bikas Bank Ltd., Muktinath Bikas Bank Ltd., and Shangrila Development Bank Ltd. The purposive sampling strategy is employed for data collection. MVPS is a dependent variable, and EPS, DPS, PER, CRR, and CAR are independent variables. The findings show that MVPS has a strong positive association with EPS, DPS, and PER and a weak negative correlation with cash reserve ratio (CRR), indicating a slight tendency for these variables to move in tandem. CRR is not statistically significant, though. However, PER, DPS, and EPS are statistically significant. The results of the regression analysis showed that CAR and CRR had a negative effect on MVPS, but CAR is not statistically significant. In a similar vein, EPS, DPS, and PER all have a positive influence on MVPS, with PER and DPS being statistically significant while EPS is not. Therefore, the relationship between MVPS and PER, CRR, EPS, CAR, and DPS is linear.