As the market takes upward stride, where does the PE ratio of listed companies stand? Find out the latest PE ratio of all sectors and all companies

Mon, Feb 24, 2020 12:06 PM on Exclusive, Stock Market,
As the mar...

The secondary market of Nepal is striding upwards with the NEPSE index rising along with the share prices of many listed companies. This rise in prices has a significant impact on the price to earnings ratio of the companies relative to the ratio that was posted in the second quarter report of the companies.

The article below shows the PE ratio of all listed companies categorized based on the sector. The prices are taken as of Falgun 11, 2076 (Yesterday). Similarly, the annualized EPS is taken from the second-quarter report and has been adjusted for any dividend that has been declared and approved by the company.

Commercial Bank

The industry average PE ratio of commercial banks stands at 14.86 times as of yesterday. The table below shows the PE ratio of each bank individually.

 

Development Bank

The industry average PE ratio of the Development Bank Sector is higher than that of commercial banks at 16.80 times. The table below shows the list of development banks and their latest PE ratio:

The above table only includes 23 development banks as the majority are under the merger and acquisition process due to which their transaction has been halted in NEPSE. Likewise, KRBL is the only development bank that hasn't published its Q2 report yet.

Finance Companies

Similarly, the average PE ratio of finance companies stands at 15.96 times. Two of the companies, PROFL and SFCL, have negative EPS and therefore doesn't have PE ratio.

 

Likewise, four finance companies' trading has been halted in NEPSE as they are undergoing mergers and acquisitions.

 

Hotels

The Hotel sector reports a higher PE ratio than the above sectors. It has an industry average PE ratio of 35.81 times.

 

Hydropower Companies

Out of the 32 listed Hydropower Companies, 2 haven't published Q2 while the rest have. Among the 30, nine companies have failed to report net profit till the second quarter of 2076/77.

The industry average PE ratio stands at 15.36 times as shown in the table below.

Life Insurance Companies

The industry average PE ratio of life insurance companies stands at 76.04 times with average annualized EPS of Rs 13.30 only.

 

Among the 7 life insurance companies, LICN and NLIC have the highest price despite average EPS. This shows that the demand for shares of these companies is higher relative to others.

Manufacturing and processing companies

In the case of the manufacturing sector, the industry average may not be very accurate. BNL was last traded on Ashwin 23, 2076 and therefore has been included. Similarly, NLO and SRS haven't published their financial report in order to know about their EPS and finally, UNL is traded very infrequently. It was last traded on Falgun 06, 2076 at Rs 17,849.

 

The remaining three - BNT, HDL, and SHIVM - have reported an average PE ratio of 24.28 times as shown below.

 

Microfinance Companies

The industry average PE ratio of the microfinance sector stands at 58.41 times. It includes 38 companies, while the other 12 companies have been excluded.

 

The table below shows the list of companies that are undergoing mergers and acquisitions and therefore aren't being traded in NEPSE.

 

Non-life Insurance Companies

The fifteen listed non-life insurance companies report an industry average PE Ratio of 44.12 times. The table below shows the list of companies, their price as on Falgun 11, 2076, their adjusted annualized EPS and the PE ratio.

 

Others

The other sector has a total of four companies under it. Among them, NFD (Nepal Film Development) is inactive. The remaining three make up an industry average PE ratio of 30.85 times with average EPS of Rs 39.98.

Trading

In the case of the trading sector, both the companies i.e. BBC and STC haven't published their financial reports and therefore don't have the latest PE ratio.

Overall

The table below shows the industry average annualized EPS and PE ratio of all sectors. The insurance companies and microfinance companies have the highest price in comparison to the earnings.