AAKASH CAPITAL LIMITED

Weekly Newsletter from Aakash Capital Limited for the week ending on 26th July, 2019

NEPSE UPDATE

Indicators 21st July, 2019

25th July, 2019

% change

NEPSE 1272.49 1269.92 -0.20%

SENSITIVE 273.84 273.47 -0.14%

FLOAT 93.61 93.50 -0.12%

SEN. FLOAT 87.02 86.94 -0.09%

BANKING 1148.38 1148.42 0.00%

HOTELS 2070.62 2076.83 0.30%

DEVELOPMENT BANKS 1636.86 1623.20 -0.83%

HYDROPOWER 1216.62 1190.60 -2.14%

FINANCE 627.42 624.73 -0.43%

NON LIFE INSURANCE 5104.26 5091.52 -0.25%

MANU. & PRO. 2717.5 2672.31 -1.66%

OTHERS 720.75 723.01 0.31%

MICROFINANCE 1460.48 1491.15 2.10%

LIFE INSURANCE 6040.71 5956.83 -1.39%

MUTUAL FUND 10.12 9.89 -2.27%

Market Summary Statistics (21st to 25th July, 2019)

Total Turnover (Rs) 1,977,794,934.00

Total Traded Shares 7,192,764.00

Total Number of Transactions 27,816.00

Scrips Traded 171.00

Market Cap at Week start 1,579,727.81 Millions

Market cap at Week end 1,581,188.31 Millions

Floated Market Cap at Week start 564,084.21 Millions

Floated Market Cap at Week end 564,833.20 Millions

Bullion Update

As on 25th July, 2019 Hallmark Gold Rs.65,000/tola

Worked Gold Rs.64,700/tola

Silver Rs.775/tola

Quote for the week

“Investing should be more like watching paint dry

or watching grass grow .” -Paul Samuelson

The market declined 0.20% (2.57 points) in the trading

week between 21st July and 25th July 2019. The

sensitive index, which measures the performance of

the companies classified under group “A”, also

registered a fall of 0.14% (0.37 points). Similarly, float

index which measures the performance of securities

which are floated to public also went down by 0.12%

and sensitive float followed the suit by falling 0.09%.

This week the market opened at 1276.29 on Sunday

and went down 3.8 points to sit at 1272.49. The market

climbed for the following three days, but gave up

almost all the gained points in the final trading day. The

market added 2.49, 5.94 and 6.90 points on Monday,

Tuesday and Wednesday respectively. However, on

Thursday, the last trading day of the week, the index

shed 14.15 points to end the week at 1269.02. This was

actually the opening day followed by the newly

unveiled monetary policy, and the investors’

expectations seems to have gone unmet.

In this review period, most of the sectors closed lower,

mirroring the market. Mutual Fund sub-index fell the

most and closed 2.27% lower. Hydropower,

manufacturing and processing, and life insurance sub-

indices followed the suit as they dropped more than

1%, i.e. 2.14%, 1.66% and 1.39% respectively.

Development banks, finance and non-life insurance

sub-indices fell by 0.83%, 0.43% and 0.25%

respectively. The heavyweight banking sub-index

remained fairly unchanged. Microfinance sub-index

posted the highest gain as it climbed 2.10%. This was

followed by only the other two winning sub-index this

week others and hotel, which added a marginal gain of

0.31% and 0.30% respectively.

The market witnessed inactivity as the total turnover

stood at Rs 1.9 Billion, averaging just Rs395 million a

day. The total market value declined by Rs. 3,205.09

million as the market capitalization went down 0.20%.

Similarly, floating market cap saw a decline of 0.11%

this trading week.

.

News Update

Nepal Rastra Bank rolls out Monetary Policy 2019-20 Nepal Rastra Bank on Wednesday unveiled the Monetary Policy 2019-20 which analysts and the private sector say contain few policy measures to address the liquidity problem in the banking sector and stabilise interest rate fluctuations.

Transport protest hurts market

The ongoing protests in the transport sector have caused a scarcity of consumption goods in Chitwan. The uproar was caused by the Government's decision of levying Value Added Tax in the transport sector, introducing the Vehicle Consignment Tracking System (VCTS), and issuing PAN to all the salaried employees.

Rs 2.5 million provided to PM Relief Fund

Two organisations today handed over Rs 2.5 million to Prime Minister KP Sharma Oli in order to deposit it in the Prime Minister Natural Disaster Relief Fund…..Read More

Govt planning counselling sessions for migrants going to South Korea

The government is planning to initiate special counselling sessions for Nepali migrant workers who seek employment in South Korea…..Read More

Old habits die hard: Saudi Arabia struggles to end oil addiction

When Saudi Aramco was on the verge of a deal last year to buy a stake in an Indian oil refinery, its boss quickly boarded a company jet in Paris and flew to New Delhi…..Read More

Market Announcements

Machhapuchchhre Bank Limited has extended its (30,00,000 units @ Rs.1000 per unit) 10.25% Machhapuchchhre Debenture 2085 to the general public till (3rd Bhadra, 2076).

Womi Laghubitta Bittiya Sanstha Limited has issued it's 1:1 ratio 10,10,880 units right share to its shareholders from

25th July 2019 (9th Shrawan, 2076).

NIC Asia Capital Limited has issued its 125 million units of Rs 10 face value each mutual fund scheme worth Rs 1.25

billion (NIC Asia Balanced Fund) to the general public from 24th July 2019 (8th Shrawan, 2076).

Radhi Bidyut Company Limited is distributing 5% Cash Dividend directly to bank accounts and urged its shareholders to

dematerialize their shares.

Prabhu Bank Limited has posted a net profit of 2.05 billion and published its 4th quarter company analysis of the fiscal

year 2075/76.

Global IME Laghubitta Bittiya Sanstha Limited has posted a net profit of 68.06 million and published its 4th quarter

company analysis of the fiscal year 2075/76.

NMB Laghubitta Bittiya Sanstha Limited has posted a net profit of 60.98 million and published its 4th quarter company

analysis of the fiscal year 2075/76.

Janasewi Laghubitta Bittiya Sanstha Limited has posted a net profit of Rs 14.61 million during the 4th quarter of the

fiscal year 2075/76.

National Microfinance Bittiya Sanstha Limited has posted a net profit of 131.45 million and published its 4th quarter

company analysis of the fiscal year 2075/76.

Nabil Bank Limited has published a notice regarding the conversion of promoter share structure.

Shikhar Insurance Company Limited has announced its 14th AGM going to be held on 28th Shrawan, 2076.

Lumbini General Insurance Company Limited has announced its 14th AGM going to be held on 29th Shrawan, 2076.

Lumbini Bikas Bank Limited has amended its 11th AGM notice.

https://english.aarthiknews.com/rs-2-5-million-provided-to-pm-relief-fundhttps://thehimalayantimes.com/business/govt-planning-counselling-sessions-for-migrants-going-to-south-korea/https://thehimalayantimes.com/business/govt-planning-counselling-sessions-for-migrants-going-to-south-korea/https://thehimalayantimes.com/business/old-habits-die-hard-saudi-arabia-struggles-to-end-oil-addiction/https://thehimalayantimes.com/business/old-habits-die-hard-saudi-arabia-struggles-to-end-oil-addiction/https://www.sharesansar.com/announcementdetail/machhapuchchhre-bank-limited-has-extended-its-3000000-units-at-rs1000-per-unit-1025-machhapuchchhre-debenture-2085-to-the-general-public-till-3rd-bhadra-2076https://www.sharesansar.com/announcementdetail/machhapuchchhre-bank-limited-has-extended-its-3000000-units-at-rs1000-per-unit-1025-machhapuchchhre-debenture-2085-to-the-general-public-till-3rd-bhadra-2076https://www.sharesansar.com/announcementdetail/womi-laghubitta-bittiya-sanstha-limited-is-issuing-its-11-ratio-1010880-units-right-share-to-its-shareholders-from-today-9th-shrawan-2076https://www.sharesansar.com/announcementdetail/womi-laghubitta-bittiya-sanstha-limited-is-issuing-its-11-ratio-1010880-units-right-share-to-its-shareholders-from-today-9th-shrawan-2076https://www.sharesansar.com/announcementdetail/nic-asia-capital-limited-is-issuing-its-125-million-units-of-rs-10-face-value-each-mutual-fund-scheme-worth-rs-125-billion-nic-asia-balanced-fund-to-the-general-public-from-today-8th-shrawan-2076https://www.sharesansar.com/announcementdetail/nic-asia-capital-limited-is-issuing-its-125-million-units-of-rs-10-face-value-each-mutual-fund-scheme-worth-rs-125-billion-nic-asia-balanced-fund-to-the-general-public-from-today-8th-shrawan-2076https://www.sharesansar.com/announcementdetail/radhi-bidyut-company-limited-is-distributing-5-cash-dividend-directly-to-bank-accounts-and-urged-its-shareholders-to-dematerialize-their-shareshttps://www.sharesansar.com/announcementdetail/radhi-bidyut-company-limited-is-distributing-5-cash-dividend-directly-to-bank-accounts-and-urged-its-shareholders-to-dematerialize-their-shareshttps://www.sharesansar.com/announcementdetail/prabhu-bank-limited-has-posted-a-net-profit-of-205-billion-and-published-its-4th-quarter-company-analysis-of-the-fiscal-year-207576https://www.sharesansar.com/announcementdetail/prabhu-bank-limited-has-posted-a-net-profit-of-205-billion-and-published-its-4th-quarter-company-analysis-of-the-fiscal-year-207576https://www.sharesansar.com/announcementdetail/global-ime-laghubitta-bittiya-sanstha-limited-has-posted-a-net-profit-of-6806-million-and-published-its-4th-quarter-company-analysis-of-the-fiscal-year-207576https://www.sharesansar.com/announcementdetail/global-ime-laghubitta-bittiya-sanstha-limited-has-posted-a-net-profit-of-6806-million-and-published-its-4th-quarter-company-analysis-of-the-fiscal-year-207576https://www.sharesansar.com/announcementdetail/nmb-laghubitta-bittiya-sanstha-limited-has-posted-a-net-profit-of-6098-million-and-published-its-4th-quarter-company-analysis-of-the-fiscal-year-207576https://www.sharesansar.com/announcementdetail/nmb-laghubitta-bittiya-sanstha-limited-has-posted-a-net-profit-of-6098-million-and-published-its-4th-quarter-company-analysis-of-the-fiscal-year-207576https://www.sharesansar.com/announcementdetail/janasewi-laghubitta-bittiya-sanstha-limited-has-posted-a-net-profit-of-rs-1461-million-during-the-4th-quarter-of-the-fiscal-year-207576https://www.sharesansar.com/announcementdetail/janasewi-laghubitta-bittiya-sanstha-limited-has-posted-a-net-profit-of-rs-1461-million-during-the-4th-quarter-of-the-fiscal-year-207576https://www.sharesansar.com/announcementdetail/national-microfinance-bittiya-sanstha-limited-has-posted-a-net-profit-of-13145-million-and-published-its-4th-quarter-company-analysis-of-the-fiscal-year-207576https://www.sharesansar.com/announcementdetail/national-microfinance-bittiya-sanstha-limited-has-posted-a-net-profit-of-13145-million-and-published-its-4th-quarter-company-analysis-of-the-fiscal-year-207576https://www.sharesansar.com/announcementdetail/nabil-bank-limited-has-published-a-notice-regarding-the-conversion-of-promoter-share-structurehttps://www.sharesansar.com/announcementdetail/nabil-bank-limited-has-published-a-notice-regarding-the-conversion-of-promoter-share-structurehttps://www.sharesansar.com/announcementdetail/lumbini-general-insurance-company-limited-has-announced-its-14th-agm-going-to-be-held-on-29th-shrawan-2076https://www.sharesansar.com/announcementdetail/lumbini-general-insurance-company-limited-has-announced-its-14th-agm-going-to-be-held-on-29th-shrawan-2076https://www.sharesansar.com/announcementdetail/lumbini-bikas-bank-limited-has-amended-its-11th-agm-noticehttps://www.sharesansar.com/announcementdetail/lumbini-bikas-bank-limited-has-amended-its-11th-agm-notice

NEPSE - TECHNICAL ANALYSIS

The Nepalese stock market declined continuously after it made its top on 27th of July, 2016. Currently, the index is in at short

term support zone as seen in the daily chart. The market had shown short term bull after Nepali New Year. This week the market

closed at 1269.92 forming a red candle on last trading day. This week NEPSE opened at 1276.29 and formed a red candle by

closing at 1268.74, losing 7.55 points during the day. The transaction turnover increased from Rs.411.36 million of previous

week ending to Rs.550 million at the end of this week. Upward momentum in the transaction has seen in this review period,

however the market lost 2.57 points this week. Downtrend market has shown short term bull basically in the month of March

and April in last three years but most highs are seen in the month of July. As of daily line chart the short term resistance might

be at around 1274 followed by 1284. Taking the Fibonacci retracement from 1100 to 1316, the 0.382 Fibonacci ratio lies at 1235,

which indicates strong psychological support.

Technical Indicators

Indicators Value Signal

Support (S1) 1268 -

Resistance (R1) 1274 -

Relative Strength Index (RSI) 52.52 Moderate zone

Moving Average Convergence Divergence (MACD) 2.31 Bullish

5-Day Exponential Moving Average (EMA) 1274.22 Bearish

20-Day Exponential Moving Average (EMA) 1260.07 Bullish

180-Day Exponential Moving Average (EMA) 1205.28 Bullish

Relative Strength Index (RSI) Analysis

RSI is a moment indicator that measures the magnitude of recent price changes to evaluate overbought or oversold conditions

in the price of a stock. RSI is typically used on a 14-day time frame, measured on a scale from 0 to 100, where a value above 70

represents overbought and below 30 represents oversold condition.

Current RSI value of NEPSE is 52.52 which indicates that the market is at moderate zone. There is no any formation of short term

divergence as decrease in price and RSI chart is similar. However, if the market retrace from the support zone of 1268, there is

a chance of forming short-term regular bullish divergence.

Moving Average Convergence Divergence (MACD)

MACD is a momentum oscillator formed by using two different moving averages, typically a 26 day EMA and 12 day EMA, which

provides specific buy/sell signal. When the MACD line crosses signal line from above, it is considered bearish, indicating a sell

signal and vice-versa.

Currently MACD and signal line is at 2.31 and -1.51 respectively. MACD has already crossed the signal line and it is above the

base line. The signal line is still below the base line however, MACD has shown bullish signal for the overall market.

Moving Average Analysis

Moving average is a technical analysis tool that smooths out price data by creating a constantly updated average price. It is used

to identify the trend direction, support or resistance levels and also to generate potential buy/sell signals. Price crossover and

MA crossover are some of the strategies that can be used to buy/sell a stock.

The EMA (5, 0) green line is at 1274.22 and EMA (20, 0) red line is at 1260.07 The index is currently trading below 5 days and

above 20 days Exponential Moving Average. This indicates that the overall market is falling towards the support zone.

Bollinger Band

Bollinger band is a technical indicator that consists of a set of lines plotted two standard deviations up and below a 21-day simple

moving average. The bands are an indication of volatility; a widening gap indicates higher volatility and vice-versa. Prices are

relatively high when above the upper band and low when below the lower band.

The upper, middle and the lower bands are at 1284.17, 1260.07 and 1235.98 respectively. The market is trading around the

upper band which indicates the market is at overbought zone and trying fall towards the support zone.

Stock Analysis: Grameen Bikas Laghubitta Bittiya Sanstha Ltd. (GBLBS)

Grameen Bikas Laghubitta Bittiya Sanstha Ltd.(GBLBS) formerly Nepal Grameen Bikas Bank Ltd. came into existence in 2014

August 15 (Shrawan 30, 2071) with the successful merger of the then five regional level Grameen Bikas Bank operated in the

five development region of Nepal. The head office of the institution located at Butwal, Rupandehi district of province no. 5.

The GBLBS was registered as a public limited company on 30th July 2014 (Shrawan 14, 2071) under Company Act, 2063 and is

regulated under Bank and Financial Institution Act, 2073.The Name of the Nepal Grameen Bikas Bank Ltd. has been changed

into Grameen Bikas Laghubitta Bittiya Sanstha Ltd. (GBLBS) as per the decision of Annual General Meeting of the institution and

approval of Office of the Company Registrar (approval date:2074/12/28). The institution has been working continuously with

the prime objective of alleviating poverty, hardship and suffering of the rural people throughout its working area by providing

them micro finance services. The unique traits of the institution are well defined target group (especially women), area

approach, group guarantee lending, non-collateral lending etc.

In order to achieve its goal, the institution has been working through micro credit services and capacity development program

for the community. Moreover, it has followed the Grameen Bank Model started by Prof. Muhammad Yunus (Nobel Laureate) in

Bangladesh.

Board of Directors

Name Designation

Mr. Manik Ratna Shakya Chairman

Mr. Chandi Prasad Ghimire Director

Mr. Narendra Singh Bista Director

Mrs. Salonika Singh Director

Mr. Bhesraj Kandel Director

Mr. Sushil Kumar Thapa Director

Mr. Ramesh Dahal Director

(Source: http://grameenbanknepal.com)

Senior Executives

Name Designation

Mr. Parbat Kumar Karki Chief Executive Officer

Mr. Narayan Bhattarai Credit Management Policy & Planning Department

Mr. Sadananda Sah Information Technology Department

Mr. Deepak Prasad Pandey Company Secretary Department

Mr. Laxman Aryal General Service Department

Mr. Pitambar Nepal Internal Audit Department

Mr. Motiram Adhikari Human Resource Management

Mr. Kumar Bahadur Singh Branch & Risk Management Department

Mr. Moti Raj Khanal Finance Department

(Source: http://grameenbanknepal.com)

http://grameenbanknepal.com/http://grameenbanknepal.com/

Capital Structure

(As of 16 July 2018)

Authorized Capital (Rs.) 1,000,000,000

Issued Capital (Rs.) 655,000,000

Paid Up Capital (Rs.) 655,000,000

Shareholding Pattern

(As of 16 July 2018)

S.N. Particulars Percent

(%)

Amount (Rs.)

1 Domestic Ownership: 100.00% 655000000.00

1.1 Nepal Government 30.17% 197,580,338.48

1.2 Nepal Rastra Bank 3.05% 19,998,800.00

1.3 Bank and Financial Institutions 14.08% 92,250,461.52

1.4 Group Member & Bank Staff 12.08% 79,098,600.00

1.5 Other Institutions 10.34% 67,740,000.00

1.6 Bandikapur Bachat Tatha Sahakari Sanstha 0.19% 1,228,700.00

1.7 Public 30.09% 197,103,100.00

2 Foreign Ownership: - - Total 100.00% 655,000,000.00

Major Shareholders

(As of 16 July 2018)

S.N. Particulars Percent

(%)

Amount (Rs.)

Group "A" :

Nepal Government 30.17% 197,580,338.48 Nepal Rastra Bank 3.06% 19,998,800.00 Nepal Bank Limited 2.90% 19,010,502.56 Rastriya Banijya Bank Limited 2.30% 15,032,902.56 Nepal Bangladesh Bank Limited 1.48% 9,681,000.00 Himilayan Bank Limited 1.47% 9,599,600.00 Nepal SBI Bank Limited 1.42% 9,281,000.00 Nabil Bank Limited 0.82% 5,363,551.28 Nepal Investment Bank Limited 0.74% 4,859,802.56 People's Investment Company Limited 10.23% 67,000,800.00 Shova Mishra 0.68% 4,447,000.00

(Note: Above mentioned are the shareholders owning more than 0.5% shares of the company)

Financial Highlights

Yearly Analysis

The following table presents the trend of financial performance of GBLBS from the FY 2014/15 to 2017/18

Year 2014/15 2015/16 2016/17 2017/18 CAGR

Paid-up Capital (Rs.000) 557,500 557,500 557,500.00 655,000.00 5.52%

Reserves & Surplus

(Rs.000)

-231,437.24 12,988.42 140,251.25 300,721.67

Deposit Liabilities (Rs.000) 1,476,944.92 1,819,407.06 2,255,837.07 2,744,660.18 22.94%

Growth %

23.19% 23.99% 21.67%

Total Assets (Rs.000) 3,242,611.97 7,662,093.23 8,828,117.87 9,981,333.39 45.47%

Loans (Rs.000) 4,918,915.11 6,083,617.82 7,363,367.57 8,254,069.33 18.83%

Growth %

23.68% 21.04% 12.10%

Interest Income (Rs.000) 888,868.69 1,147,104.67 1,419,360.50 1,533,392.54 19.93%

Net Interest Income

(Rs.000)

646,879.72 860,929.46 1,003,632.98 876,707.83 10.67%

Total Operating Income

(Rs.000)

727,273.86 958,372.66 1,119,122.69 1,049,377.16 13.00%

Personnel Expenses

(Rs.000)

440,054.93 471,465.96 744,329.00 639,357.87 13.26%

Net Profit (Rs.000) 181,538.57 245,805.32 128,301.86 160,310.51 -4.06%

Growth % 160.92% 35.40% -47.80% 24.95%

Net Interest Income to

Total Operating Profit %

88.95% 89.83% 89.68% 83.55%

Return on Assets (ROA) 2.91% 3.21% 1.45% 1.61%

Return on Equity (ROE) 55.68% 43.09% 18.39% 16.77%

EPS (Rs.) 32.56 44.09 23.01 24.47

Book Value Per share (Rs.) 1.52 80.00 101.86 124.84

Market Value per share

(Rs.)

- 1080 746 613

Price Earnings Ratio - 24.50 32.42 25.05

Capital Fund to RWA

(CAR) %

2.73% 5.19% 5.14% 6.80%

Non-Performing

Loan(NPL) to Total Loan

%

5.70% 4.73% 4.19% 4.38%

Total Staff number 921 927 917 917

Within the short span of its operation, Grameen Bikas Laghubitta Bittiya Sanstha Ltd.(GBLBS) has able to make its fundamentals

strong as compared to other microfinance institutions. During the initial years after its operation, negative fundamentals were

observed. However, in last 3 years it has improved a lot in its operation. The company has reported 24.95% growth in its Net

Profit to Rs.160 million in year 2017/18 but the company faced massive decline in its Net Profit by 47.80% in 2016/17 due to

increase in Personnel Expenses by 57.88% in the same year. As the number of staffs were reduced from 927 to 917 such massive

increase in Personnel Expenses was abnormal. However, other fundamentals are growing consistently. The company reported

21.67% growth in its Deposits collection, 12.10% in Loans, and 114.42% in reserves and surplus. The company has met its paid

up capital of 60 crores directed by NRB in 2017/18 but seems unable to maintain the Capital Adequacy ratio of 8%.

Snapshot of performance

55.75 55.75 55.7565.50

-23.14

1.30

14.03

30.07

-40.00

-20.00

0.00

20.00

40.00

60.00

80.00

2014/15 2015/16 2016/17 2017/18

Paid-up Capital & Reserves and Surplus

Paid-up Capital (Rs.crores) Reserves & Surplus (Rs.crores)

147.69181.94

225.58274.47

491.89

608.36

736.34

825.41

0.00

100.00

200.00

300.00

400.00

500.00

600.00

700.00

800.00

900.00

2014/15 2015/16 2016/17 2017/18

Deposits & Loans

Deposit Liabilities (Rs.crores) Loans (Rs.crores)

18.15

24.58

12.8316.03

32.56

44.09

23.01 24.47

0.00

10.00

20.00

30.00

40.00

50.00

2014/15 2015/16 2016/17 2017/18

Net Profit & EPS

Net Profit (Rs.crores) EPS (Rs.)

0

1080

746

613

32.56 44.09 23.01 24.470

200

400

600

800

1000

1200

2014/15 2015/16 2016/17 2017/18

EPS vs MPS

Market Value per share (Rs.) EPS (Rs.)

921 927917

917

44.01 47.15 74.43 63.940

200

400

600

800

1000

2014/15 2015/16 2016/17 2017/18

Total number of Staffs & Personnel Expenses

Total Staff number Personnel Expenses (Rs.crores)

44.01 47.15

74.4363.94

18.1524.58

12.83 16.03

0.00

20.00

40.00

60.00

80.00

2014/15 2015/16 2016/17 2017/18

Personnel Expenses vs Net Profit

Personnel Expenses (Rs.crores)

Net Profit (Rs.crores)

Quarterly analysis

Particulars Q3

2018/19

Q3

2017/18

Growth

(%)

Paid-up Capital Rs. '000' 655,000 655,000 0.00%

Reserve and Surplus Rs.’000’ 560,256 284,087 97.21%

Borrowings Rs.'000' 4,760,040 4,819,604 -1.24%

Deposits Rs.’000’ 3,094,274 2,602,788 18.88%

Loans Rs.’000’ 9,683,004 8,519,332 13.66%

Personnel expenses 430,578 393,442 9.44%

Net Profit Rs.’000’ 164,417 143,753 14.37%

Return on equity (%) 1.39% 1.34% 4.19%

Return on asset (%) 13.53% 15.31% -11.62%

Net worth per share Rs. 185.54 143.37 29.41%

Earnings per share Rs. 33.47 29.27 14.35%

MPS Rs. 446 558 -20.03%

P/E ratio 13.33 19.06 -30.06%

Credit to Deposit Ratio (%) 31.96% 30.55% 4.62%

Capital fund to RWA (%) 8.84% 7.30% 21.10%

NPL to Total Loans 4.76% 4.96% -4.03%

As of third quarter ending the net profit of the bank has increased by 14.37% to Rs.164 million. The bank has 13.66% rise in

Loans and 1.24% fall in borrowings. Similarly, the bank has reported rise of 97.21% in reserve and surplus. Most of the

fundamentals of the bank are growing at good pace. The company has able to generate significant growth up to this quarter

regardless of fall in borrowings. Most of the ratios directed by NRB seems improved in this quarter as it has fulfilled the criteria

of minimum 8% capital adequacy ratio. NPL to total loans has also fall to 4.76% from 4.96%. The company seems to be in a

good fundamental position.

Auction Notice

The company is selling its 392,393 units’ promoter shares and 190,451

units’ ordinary shares through auction to the general public from 24th

to 31st July 2019. Both the promoter and ordinary shares are

unsubscribed right shares by the existing shareholders. Eligible

candidates can place bid above Rs.100 with minimum units of 100 units.

Technical Analysis of GBLBS as on July 25th, 2019

Day Candle

Open 350

High 354

Low 340

Close 354

Pattern Analysis

Chart Pattern Short term Uptrend

Resistance R1: 357 R2:360

Support S1: 352 S2: 347

Higher Breakout Level 365

Particulars Points Remarks

Volume 3,814.00 The daily volume of stock is higher than that of

the 1 week and 1 month volume. Avg. Volume (1 week) 2,360.80

Avg. Volume (1 month) 2,111.43

No. of Transaction 32.00 The daily number of transactions is higher than that of average transaction of the week and month.

Avg. no. of Transaction (1 week) 22.00

Avg. no. of Transaction (1 month) 25.10

180 days Average 408.57 The price of the stock is trading below 180 days and 360 days average. 360 days Average 493.59

52 Weeks High Price 616 The stock is currently trading around 52 week’s low price. 52 Weeks Low Price 325

Nepse Index 1 year Change 6.32% The overall market in the last 12 months has raised but the industry has fallen. The stock has fall in the past one year but has gained in 1 month’s period.

Industry Index 1year Change -4.20%

Stock 1-Month Change 1.72%

Stock 1-Year Change -39.69%

Monthly Beta 1.058 Both the monthly and quarterly beta of the stock are higher than the market. Quarterly Beta 1.461

Total Holdings of Mutual Funds (Jestha) 13,258 The Mutual Funds are holding very less number of shares of the company (0.13%) as compared to other companies.

Stock Holdings of Top Broker (from June, 2019) 12,452 The sum of Stock holdings of 5 Brokers is shown with the average of their average buying and selling price.

Top Broker Avg. Buy Price 354.18

Top Broker Avg. Sell Price 351.44

Concluding Remarks

Micro finance sector plays a vital role in poverty alleviation of developing countries like Nepal. GBLBS is a national level

microfinance company operating in the rural parts of Nepal. It is creating value for its customers through its microfinance

services which ultimately supports the economic development. The company has support from Nepal Government, Nepal

Rastra Bank, and other Financial Institutions which might help to expand and make its operation more effective and systematic.

Currently, the company is operating above industry average which indicates the benefit of competitive advantage. However,

most of the ratios directed by Nepal Rastra Bank are weak as compared to the industry. Looking from quarterly perspective,

the fundamentals are moving towards comfortable zone. So, it has potential to perform well in coming days with its better

operating mechanism and possess good future in Nepalese developing economy.

Indicators Points Remarks

RSI (14) 52.59 GBLBS is at moderate zone.

MACD (12,26,9) -0.32 The MACD line is above and signal line and both are below the baseline.

Signal Line (12,26,9) -2.41

Histogram (12,26,9) 2.08

EMA (5,0) 353.80 EMA 5 and EMA 20 are below the price.

EMA (20,0) 347.55

+DMI(13,8) 23.73 The +DMI is dominant over -DMI and ADX is at 19.88.

-DMI(13,8) 20.06

ADX (13,8) 19.88

Chaikin Money Flow (20) -0.0595 CMF is below the baseline which shows selling pressure for the stock in the market.

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