How the Rasuwa flood wiped out three hydropower stocks on NEPSE overnight

A friend who bought 50 kitta of Rasuwagadhi Hydropower two years ago, mostly because the dividend history looked decent for a run-of-river plant, texted me on Thursday asking if his shares were now worth zero. They weren't, but the chart looked close enough to justify the panic.

Three hydropower counters on NEPSE fell hard in the same session, and all three sit on rivers that a glacier collapse turned into a debris flow on 26 August 2026. This is what actually happened to each one, and the difference between a stock that's down because of a headline and a stock that's down because its dam is gone.

What actually happened to each stock

Two things worth noticing in that table before you read anything else into the percentages. First, Rasuwagadhi didn't stop falling after day one, it moved again the next session from a new reference price, which tells you the market was still pricing in new information rather than a one-time overreaction. Second, TVCL is not the same kind of loss as the other two. It was still under construction, generating no revenue and paying no dividend, so its share price drop reflects a delayed start date and damaged capital assets, not a hit to income that was already flowing to shareholders.

This wasn't panic selling, the damage is confirmed

Rasuwagadhi's own statement, as relayed by ShareSansar, described "significant damage to the dam site, residential facilities, and most of the structures of the hydropower plant," and said the status of on-site employees was unknown in the immediate aftermath. An NEA spokesperson went further in comments to the Kathmandu Post, calling the plant completely washed away. TVCL's disclosure described most of its under-construction structures as severely damaged or completely destroyed. Molung Khola's power generation was reported halted after what local coverage called major flood damage.

None of this is a NEPSE-format regulatory filing you can pull as a PDF, it's company statements as relayed through news outlets, so treat the descriptions as credible but not as an audited damage report. What you can say with confidence is that the share moves tracked real, disclosed damage rather than an unexplained rumor. If you're on the other side of this, holding a policy rather than shares, the mechanics of actually filing a flood claim in the affected districts are covered separately.

The selling wasn't confined to hydropower either. Nepal's non-life insurance sub-index fell 3.9 percent the same day, the worst-performing sector, on investor concern about insurers' payout exposure to the damaged plants they cover. Three insurers, Shikhar, Neco, and Siddhartha Premier, publicly urged flood-affected policyholders in the region to come forward, and the Nepal Insurers' Association backed a sector-wide claims push. None of that confirms a specific payout to Rasuwagadhi, Molung Khola, or TVCL themselves, it just tells you the industry expects this to cost money.

How the circuit limit actually worked here

NEPSE raised its individual-stock daily price limit from 10 percent to 15 percent in an April 2026 rule change, on both the upside and downside. Rasuwagadhi's -15 percent on 26 August was that limit doing its job for one session, not a freeze on the stock. It traded again the next day and fell a further 8.38 percent from the new reference price, which is the clearest evidence available that the daily limit resets rather than locking the counter for multiple sessions.

Separate from the single-stock limit, a market-wide circuit breaker halts the whole exchange for 15 minutes if the index moves 5 percent within the first two hours of trading, and suspends trading for the rest of the day at an 8 percent move. Neither of those market-wide thresholds was hit on 26 August; the index itself fell 35.92 points, or 1.38 percent, to close at 2,558.35, on turnover of Rs 4.77 billion. That's a real, flood-attributable decline, but a fraction of what an 8 percent day would look like.

Same river, but the selling wasn't a blanket panic

Other counters on the same river system fell hard the same day: Upper Mailung Khola (-11.56%), Sanjen Hydropower (-11.18%), and Chilime Hydropower (-10.12%, closing at Rs 427). That's a corridor-wide move, not just three stocks.

But the rest of the market didn't collapse in sympathy. Sarbottam Paints closed up 15 percent the same session, and Upper Hewakhola Hydropower, a plant outside the affected corridor, gained over 10 percent. If this had been broad panic rather than a targeted repricing of flood-exposed assets, you'd expect the whole hydro sector to move together regardless of which river it sits on. It didn't.

No SEBON statement, surveillance flag, or special disclosure requirement specific to these counters turned up in a search of NEPSE and SEBON coverage from this window. That's worth knowing mainly because it means nothing beyond the standard circuit mechanism is currently constraining how these stocks trade.

The damage isn't limited to three tickers

Nepali business press reporting on the insurance side of this disaster put a number on the wider hydropower exposure along the same corridor: roughly a dozen operating hydropower and solar plants and another fifteen under construction, about 900 MW of capacity combined, sit in the affected river system. Most of those projects aren't the three counters this post is about, some aren't listed on NEPSE at all, but it tells you the three stocks that moved on 26 August are the visible, tradable slice of a much larger physical event. If you're watching this sector for secondary effects, that's the number to keep in mind rather than assuming the damage stopped at Rasuwagadhi, Molung Khola, and TVCL.

What this means if you actually hold one

There isn't a clean recent NEPSE precedent to point to for how fast a flood-damaged hydropower stock recovers. Nepal has had major flood events hit hydropower infrastructure before, the 2021 Melamchi flood and the 2024 nationwide floods both damaged plants, but neither had a documented NEPSE share-price recovery timeline in the sources available for this post. Anyone telling you "these things bounce back in six months" is guessing, same as anyone telling you they don't.

What's actually different across the three names matters more than the headline percentages:

• Rasuwagadhi and Molung Khola were earning revenue before the flood. Generation is now halted at both, so the near-term question is how long repair takes and whether insurance and reserves cover it without a rights issue diluting existing shareholders.
• TVCL wasn't generating revenue yet. Its loss is a pushed-back commercial operation date and damaged construction assets, which matters for when the investment starts paying off, not for a dividend stream that didn't exist yet.

Before acting on the headline drop alone, the company's own disclosure (via ShareSansar, Merolagani, or a broker's research note) on repair timeline and insurance coverage is the actual signal. A 15 percent circuit-limit move tells you the market reacted; it doesn't tell you what the plant is worth once it's rebuilt.

If margin financing is involved, this is also exactly the kind of single-day move that triggers a maintenance call on leveraged positions, worth checking regardless of which of these three names you hold.

What you actually need to know

The crash in Rasuwagadhi, Molung Khola, and TVCL tracked real, disclosed flood damage, not an unexplained panic, and the selling stayed concentrated in the affected river corridor rather than spreading across the whole hydro sector. The 15 percent circuit limit capped one day's move, it didn't freeze the stock, and there's no reliable precedent yet for how long recovery takes. If you're holding one of these names, the company's own disclosure on repair cost and insurance is worth more than the day's headline number.

Filed an insurance claim of your own after this flood, or have questions about tracking a hit like this in your portfolio? Email parjanya57@gmail.com.

This post is part of the Nepal Money Basics guide — the Invest the surplus section.