How has Prabhu Bank Limited performed as a player in the stock market? Look at some key details

Mon, Aug 12, 2019 1:15 PM on Company Analysis, Exclusive, Featured,
How has Pr...

Prabhu Bank Limited

Symbol: PRVU

Sector: Commercial Banks

No. of Outstanding shares: 88,926,750

Introduction

Prabhu Bank is a ‘A’ class commercial bank with its head office in Kathmandu. The growth of Prabhu Bank was phenomenal, especially after merger of Grand Bank Nepal Limited, Kist Bank Ltd, Prabhu Bikash Bank Ltd, Gaurishankar Development Bank Ltd and Zenith Finance Ltd, in 2016, attaining the status of “A” class financial institution licensed and regulated by the central bank of Nepal, Nepal Rastra Bank.

It is making an attempt to reach every geographical area and satisfy every segment of its customers with the networks of 189 branches, 24 Ext. Counters and 152 ATMs. At present it has more than 1,000,000 customer base.

Board of Directors

S.No.

Names

Positions

1.

Mr.Devi Prakash Battachan

Chairman

2.

Mr. Pushpa Bahadur Pradhan

Director

3.

Ms. Ambika Sharma Lamichhane

Director

4.

Mr. Ramesh Singh Khadka

Director

5.

Mr. Shankar Prasad Kalikot

Director

6.

Ms. Anju Adhakari

Director

Source: Website of the bank

Management Team

S. No.

Names

Positions

1.

Mr. Ashok Sherchan

Chief Executive Officer

2.

Mr. Maniram Pokharel

Chief Business Officer

3.

Mr. Bam Dev Dahal

Chief Project Officer

4.

Mr. Bhola Pathak

Prabhu Capital- CEO

5.

Mr. Niraj Lamsal

Chief Credit Officer

6.

Mr. Dinesh Thakali

Chief Operating Officer

Source: Website of the bank

Financial Highlights

Ratio

Indicators

FY2015/16

FY 2016/17

FY 2017/18

Q4 2018/19

Share capital

NPR

5,881,402,224

5,881,402,224

8,233,948,524

8,892,680,000

Reserve

NPR

552,439,414

2,402,884,439

3,410,720,204

3,878,366,000

Earnings Per Share

NPR

26.75

27.17

12.58

23.06

Price Earnings Ratio

Ratio

14.92

14.94

14.86

11.54

Dividend (Bonus)

Percent

                     -

                   -                        

8

                   -        

Cash Dividend

Percent

                     -

                   -           

0.42

                   -

Return on Total Assets

Ratio

1.64

1.76

0.86

1.53

Return on Equity

Percent

17

19.29

7.69

14.08

Net worth per share

NPR

109.39

140.86

152.66

163.8

Source: Annual and Quarterly Report of the bank

Facts and Figures

Key Indicators of PRVU (V/s Industry)

 

Source: SS Pro

Price History since FY 15/16 to 2019-08-07

Highest Trading Price: Rs. 460 (2017-04-23)

Lowest Trading Price: Rs.175 (2018-07-03)

Highest Closing Price: Rs. 442 (2017-04-23)

Lowest Closing Price: Rs. 176 (2018-07-03)

52-weeks High: Rs. 304

52-week Low: Rs. 177

Monthly Stock Outlook

Source: SS Pro

Based on its stock performance since 2015, (PRVU) Prabhu Bank Limited has closed higher in 100 % of Apr months. In terms of price change, it has gained the most (9.72 % on average) in Sep month.

Measurement of Investment Risk (VAR)

 

Measurement of Systematic Risk (Beta)

Source: SS PRO

It has shown an attractive double digit CAGR on various financial indicators like deposits, loans, net profit, and total assets during these five years. It has also become successful in decreasing its non-performing loan from 8.83 to 2.91 within these years.

During the fiscal year 2075/76, the bank has maintained the net profit of Rs.2.05 billion while it was Rs.96 million during the fiscal year 2074/75, an outstanding growth in net profit by 112.05%. Similarly, it ranked second among the top 25 traded commercial banks during the FY 2075/76 in terms of its turnover.

The Graham number 19.59 (less than 22.5) and PEG ratio 0.42 (less than 1) indicate that the stock of the company is undervalued. On the other hand, the core growth rate 28.32% is more than industry average. The data suggest that the company may provide good capital return to its investors in the future. Although, the company has shown strong financial during the FY 2075/76, it would be interesting to see how investors would perceive the stock of the company in the coming days.