Nadep Laghubitta more than doubles the profit, Rising NPL a warning sign
February 18, 2020 | Investopaper
Nadep Laghubitta has posted a profit of Rs. 3.19 crores until the second quarter of the fiscal year 2076/77. The profit has inclined by a whopping 123 percent from Rs. 1.43 crores of the corresponding period last year. The increase in profit is mainly due to the rise in net interest income as well as the decline in the provision for possible loss. The microfinance has provisioned Rs. 1.76 Arba for the possible losses which stood at Rs. 3.33 crores.
The net interest income has grown by 17 percent to Rs. 14.01 crores. As the loan portfolio expanded by 26 percent to Rs. 414.20 crores, the net interest income also increased.
However, the rising NPL may be an alarming sign for the microfinance. With the rapid expansion of loans, the NPL has increased to 4.79 percent, up from 4.34 percent of the previous year same quarter. The quality of the loans of the microfinance seems to degrade with aggressive lending.
Likewise, the cost of funds has also increased to 11.10 percent.
With the issue of the right and bonus, the capital of Nadep Laghubitta has grown by 130 percent to Rs. 36.80 crores. The total reserve has slightly increased to Rs. 21.63 crores.
At current capital, the per-share earnings (EPS) and per share net-worth are at Rs. 17.35 and Rs. 158.78 respectively.
The second-quarter report of Nadep Laghubitta is summarized in the table below:
Nadep Laghubitta Second Quarter Report Summary, FY 2076/77
| HEADINGS | 2nd QTR, 2076/77 | 2nd QTR, 2075/76 | PERCENT CHANGE |
| PAID-UP CAPITAL (Rs. In crores) | 36.80 | 16 | 130.00 |
| RESERVE (Rs. In crores) | 21.63 | 19.09 | 13.31 |
| BORROWINGS (Rs. In crores) | 249.93 | 206.95 | 20.77 |
| DEPOSITS (Rs. In crores) | 131.1 | 96.85 | 35.36 |
| LOANS (Rs. In crores) | 414.2 | 328.74 | 26.00 |
| NET INTEREST INCOME (Rs. In crores) | 14.01 | 11.97 | 17.04 |
| PROFIT (Rs. In crores) | 3.19 | 1.43 | 123.08 |
| NON PERFORMING LOANS, NPL (%) | 4.79 | 4.34 | 10.37 |
| COST OF FUND (%) | 11.10 | 10.77 | 3.06 |
| EARNINGS PER SHARE, EPS (Rs.) | 17.35 | ||
| NETWORTH PER SHARE (Rs.) | 158.78 | ||
| MARKET PRICE PER SHARE (Rs.) [Poush end, 2076] | 609 | ||
| P/E RATIO | 35.10 |
Note:
The above figures are based on the unaudited second-quarter report published by the respective company. Investors are advised to take other things into consideration along with this report while making investment decisions. The numbers may vary after the final audit.
Note: The share price, as well as the P/E ratio, is based on the data of Poush end, 2076. At current, the numbers may vary.
