A Study on Merchant Banking in Nepal

Abstract

The purpose of this study has to Study on Merchant Banking in Nepal. The study has analyzed over a Five-year period from 2012/13-2016/17 of 2 merchant Banking (NIBL Capital Limited & GBIME Capital Limited) in Nepal. This study has used connivance-sampling method to select the companies. Secondary and Primary data have been used in the study. Various methods like Structured Questionnaires, formal and informal interview, field survey, annual report published by the concerned institutions, Security Exchange Board of Nepal and Nepal Rastra Bank, etc. were used to meet the objectives of the study and to make the research meaningful. Analysis of Absolute Data, Analysis of Financial Ratios, Percentage, Frequency and Statistical Analysis is carried out to fulfill the objective of the study. Statistical Package for Social Sciences (SPSS) and excel applications has utilized to describe the data and determine the extent used and this has through descriptive analysis of means, standard deviations, and CV. inferior research design has utilized via regression analysis to determine the relation between the dependent variable and the independent Variables. The information has displayed by use of tables and graphs. The study found that there is negative correlation between Operating Expenses Ratio with ROA & ROE and statistically significant at 0.05 level with 2-tailed test. There is Positive between Net Profit Margin Ratio with ROA & ROE and statistically significant at 0.05 level with 2-tailed test. So these factors should analyze carefully to improve the performance of companies. Most of investor is satisfied with merchant banking service at moderate level. Similarly most of investors think that the development of merchant banking in Nepal at moderate level. Most of investors haven`t idea what types of role is playing security board of Nepal to extend Merchant Banking activities in Nepalese capital market. But according to Employee and Manager said that inappropriate Legal Provision is major hinder for development of Merchant Banking Activities. They identified some problems of merchant banking in Nepal i.e. are No proper guideline by government, Centralize capital Market and Lake of Co-ordination between Concern Authority as the another problem.