Time to review performance of micro finances! Find out how these institutes performed this quarter!

Fri, Nov 22, 2019 6:00 AM on Exclusive, Financial Analysis, Stock Market,

In NEPSE, there are 50 listed microfinance companies, the number is highest amongst other sector. Among 50 listed companies, Nadep Laghubitta Bittiya Sanstha Limited (NADEP), Ghodighoda Laghubitta Bittiya Sanstha Limited ( GGBSL ) and Swabhiman Laghubitta are yet to publish its 1st quarter report for 2076/77.

Thus, in this analysis we look into various indicators of 47 listed microfinance companies based on the unaudited 1st Quarter report of 2076/77.

Paid-up Capital:

The minimum required capital for wholesale level, national, regional and district level microfinance are Rs 600 million, Rs 100 million, Rs 60 million and Rs 10 million respectively. As per Q1 reports, Janautthan microfinance and Nepal Agro are yet to meet their capital requirement. Nirdhan Utthan (NUBL) has a paid up capital worth Rs 1.20 arba which is highest in the industry. Chimek Laghubitta (CBBL) has a paid up capital worth Rs 1.18 arba.

Reserves and Surplus:

Microfinance companies with highest reserves and surplus are Nirdhan Utthan (NUBL), Chhimek  Laghubitta (CBBL) and Sana Kisan (SKBBL) with Rs 2.29 arba, 1.86 arba and 1.89 arba reserves respectively.

Net Profit:

As of the first quarter report of FY 2076/77, the listed microfinance institutes with the highest net profit are:

  1. Chhimek Laghubitta Bittiya Sanstha Limited (CBBL) with a net profit of Rs 22.26 crores
  2. Nirdhan Utthan Bank Limited (NUBL) with a net profit of Rs 21.64 crores
  3. Sana Kisan Bikas Bank Limited (SKBBL) with a net profit of Rs 13.78 crores

Networth per Share:

Forward Community Microfinance leads in terms of networth with Rs 352.74 per share followed by Sana Kisan and RMDC with networth of Rs 331.09 and 316.43 respectively.

Earnings per Share:

Earnings per Share is one of the key indicators investor need to be updated about as it gives an idea about what the investor might get in return as dividend. Forward Laghubitta (FOWAD), Swabalamban Laghubitta (SWBBL) and Chhimek Microfinance (CBBL) make to the top list with EPS of Rs 88.73, 77.63 and 75.46 respectively.

Price to Earnings Ratio (PE):

Price to earnings ratio is one of the important indicators used by value investors to find out possible investment opportunities. The benchmark for PE ratio varies across sectors. As of 1st Quarter 2076/77, companies with lowest PE ratio are Swabalambhan Laghubitta (SWBBL), Nirdhan Laghubitta (NUBL) and Vijaya Laghubitta (VLBS) with PE ratio of 11.79, 11.92 and 12.23 respectively. These PE ratios were published in the quarterly reports.

In a nutshell