What Is Book Closure Date in NEPSE and Why It Matters for Investors

1. Introduction: What is Book Closure Date in NEPSE?

If you’ve ever invested in the Nepal Stock Exchange (NEPSE), you’ve likely come across this line:

“Book closure from X to Y for dividend purposes.”

But what does that really mean? And how does it affect you as an investor?

The book closure date is one of the most important terms to understand when it comes to dividends, bonus shares, and rights issues in the stock market. It decides who gets rewarded and when the stock price may drop.

Let’s break it all down clearly and with local NEPSE examples.

2. Definition: What Is Book Closure Date?

The book closure date is the cut-off date set by a company to determine which shareholders are eligible to receive benefits like:

Cash dividends
Bonus shares
Rights shares
AGM (Annual General Meeting) participation

On or after this date, the company closes its books and stops recording transfers of shares temporarily.

🧠 In simple terms:

If your name is in the company’s shareholder book before the book closure date, you are eligible for the announced benefits.

3. Book Closure vs Record Date: What’s the Difference?

Record Date: The date on which the company checks its official records for shareholders.
Book Closure Date: The period when share transfer is stopped to finalize the list.

In NEPSE, companies usually announce book closure rather than “record date,” but the concept is very similar.

4. How Does Book Closure Affect Investors in NEPSE?

The book closure period affects you in three key ways:

Area	Effect
Eligibility	You must buy shares at least 1 day before the book closure date to be eligible.
Trading Strategy	Prices often fall after the closure date due to adjustment.
Market Sentiment	Traders may rush in before book close and sell afterward.

5. NEPSE Example: How Book Closure Impacts Dividend Eligibility

Let’s say:

NABIL announces 20% bonus and 10% cash dividend
Book Closure Date: Shrawan 10

You must own the stock by Shrawan 9, because NEPSE follows T+1 settlement.

✅ You are eligible if:

You bought shares on or before Shrawan 9

❌ You are NOT eligible if:

You bought shares on Shrawan 10 or after

Why? Because the trade settles 1 trading day later, so you aren’t in the company’s book on time.

6. Bonus Shares and Book Closure: What to Know

Bonus shares are additional shares issued for free, drawn from company reserves.

You only get bonus shares if:

You own the stock before book closure
You hold until the book closure date (not necessarily till bonus distribution)

📉 Impact:

After bonus shares are issued, the stock price adjusts downward to account for the increase in number of shares.

7. Rights Shares and Book Closure

For rights issues, the company offers existing shareholders the right to purchase additional shares at a discounted rate.

If you’re not on the books before the book closure, you will not get the right to apply.

Rights shares can be sold separately (called “rights entitlement”), so even if you don’t want to invest more, you can sell your rights to someone else if allowed.

8. Book Closure and Stock Price Drop: How the Market Reacts

In NEPSE, right after the book closure date:

Stock prices often drop
This drop is called the “price adjustment”

This is done to reflect:

Cash going out (dividends)
Increase in share supply (bonus)

For example:

Company trades at Rs. 1,000 before book close
Issues 20% bonus
Price adjusts to ≈ Rs. 833 post-book close

Smart investors know this and plan exits before the price drop.

9. Where to Find Book Closure Dates in NEPSE?

You can check:

✅ NEPSE Website

Under Corporate Action Announcements

✅ MeroShare – My ASBA or News Section

Notices from CDSC or your DP company

✅ Nepalytix Corporate Tracker (Premium)

Aggregated view of upcoming book closures, dividend history, and eligibility alerts

10. Key Things to Remember as an Investor

Topic	Tip
Buy Timing	Buy 1 day before book close due to T+1 system
Sell Timing	Consider selling right before book closure to avoid price drop
Bonus Strategy	Hold long-term if company has consistent growth
Rights Strategy	Buy and apply only if you believe in company fundamentals

11. Common Misconceptions

Myth	Reality
You must hold till dividend is received	❌ False – Eligibility depends only on ownership at book close
All companies give bonus annually	❌ False – Depends on profit and reserves
Prices always fall after book close	✅ Usually, but market sentiment can offset the drop

12. Pro Tips for Investors

✅ Track upcoming book closures in bulk using Nepalytix dashboard
✅ Use calendar alerts to never miss eligibility
✅ Don’t blindly buy before book close—check valuation
✅ Beware of “dividend trap” where stocks rally pre-book and crash after
✅ Combine book closure info with broker data, volume spikes, and corporate history for a full picture

13. Sample Calendar: Book Closure Events in Recent Months

Symbol	Event	Book Closure	Announcement
NLIC	15% Bonus	Ashar 15	AGM Notice
NABIL	20% Bonus, 10% Cash	Shrawan 10	Board Meeting
HIDCL	Rights Issue	Bhadra 5	SEBON Approval

14. Conclusion: Book Closure is a Key Part of Smart Investing

Understanding book closure in NEPSE helps you:

Maximize returns from dividends and bonus shares
Avoid unexpected losses from price adjustments
Time your entries and exits better

Whether you're a beginner or seasoned investor, using this simple concept strategically can significantly boost your portfolio results.

Final Takeaways:

🔑 Book Closure = Eligibility Cutoff Date
📆 Buy 1 Day Before to Qualify
📉 Expect Price Adjustment After Closure
📊 Use Tools Like Nepalytix for Tracking and Alerts