z

2015

Sharesansar.com

7/1/2015

IPO Analysis of Reliable Microfinance Bittiya Sanstha Ltd.

Overview

Note: IPO applied for more than 50 units should be divisible by 10 and when applied for more than

Rs.50,000 the payment should be made through account payee cheque.

Issued Units 150 thousand units

Per Unit Cost NPR 100

IPO Amount NPR 15 million

Shares allotted for Staff 3000 units

Amount allotted for Staff NPR 0.30 million

Shares allotted for Mutual Fund 7500 units

Amount allotted for Mutual Fund NPR 0.75 million

Shares allotted for General Public 139500 units

Amount allotted for General Public NPR 13.95 million

Opening Date 3/22/2072

Closing Date (Minimum) 3/25/2072

Closing Date (Maximum) 4/5/2072

Minimum Investment Units 50 units

Minimum Investment Amount NPR 5000

Maximum Investment Units 1000 units

Maximum Investment Amount NPR 100000

Issue Manager Civil Capital Market Ltd.

Introduction of Reliable Microfinance Bittiya Sanstha Ltd.

Company Profile Reliable Microfinance Bittiya Sanstha Ltd. was established in 2069/11/24 under the Company Act, 2063

and has been carrying out its activities as per Nepal Rastra Bank Act 2058 and Bank and Financial

Institution Act, 2063. It began its operations from 2070/02/05 as a class D financial institution. It has its

corporate headquarter in Besisahar 1, Narayansthan of Lamjung district.

Areas of Operation

Reliable Microfinance Bittiya Sanstha Ltd. is allowed by the NRB to operate in 10 districts. These districts

are: Lamjung, Manang, Mustang, Dolpa, Ramechhap, Sindhupalchowk, Dhading, Nuwakot, Rasuwa and

Gorkha. Currently the company has 8 branches in 7 districts. These districts are Lamjung, Dhading,

Nuwakot, Manang, Rasuwa, Sindhupalchowk and Ramechhap.

Capital Structure

The bank has an authorized capital of Rs.100 million and issued capital is Rs.50 million. Reliable

Development Bank Ltd. is the institutional promoter of the company and it holds 100% of the promoter

shares worth Rs.35 million. The additional amount of Rs.15 million is to be collected through this IPO.

Number of Authorized Districts for Operation 10

Number of Districts in Operation 7

Number of Branches 8

Areas of Operation

Authorized Capital Rs. 100 million

Issued Capital Rs. 50 million

Paid up Capital Rs. 50 million

Capital Structure

Public Rs. 15 million

Promoters Rs. 35 million

Public Vs. Promoter Share

Domestic Ownership Rs. 50 million

Foreign Ownership Rs. 0 million

Domestic Vs. Foreign Ownership

*the capital structure details have been calculated as would be after the IPO.

30%

70%

Public Vs. Promoter Share

Public Promoters

100%

0%

Domestic Vs. Foreign ownership

Domestic Ownership Foreign Ownership

Board of Directors The company has 5 members in its Board.

1. Mr. Narayan Babu Lohani, Chairman

Academic Qualifications:B.E., EMBA

Work Experience:CEO of Reliable Development Bank Ltd. for 8 year.

2. Mr. Narayan Raj Bista, Director

Academic Qualifications:B.Com

Work Experience:16 years of experience in Rastriya Banijya Bank Ltd.

3. Mr. Dipesh Babu Tiwari, Director

Academic Qualifications:M.A. in Economics, EMBA

Work Experience:3 years of experience in Prudential Finance Ltd. Assistant General Manager of

Reliable Development Bank Ltd. for the last 8 years.

4. Mr. Prem Raj Pandey, Director

Academic Qualifications: B.L.

Work Experience:Associated with Reliable Development Bank Ltd. for the last 8 years.

5. Mr. Govinda Prasad Dhakal, Director

Academic Qualifications:B.Com.

Work Experience:Worked at NIDC for 22 years. Assistant manager in Reliable Development

Bank For the last 8 years.

Reliable Development Bank Ltd. 350000 units

BOD's shareholding in the company

CEO’s Profile

Mr. Kiran Kunwar, CEO

The Company’s CEO is Mr. Kiran Kunwar. He holds a Master’s Degree in Commerce. He has had 18 years

of experience in teaching and cooperative sector.

Financial Highlights Share Capital and Reserve & Surplus:

Actual (000) Projected (000)

2012-13 Change %

2013-14 Q2 2014 2014-15 2015-16 2016-17

Share Capital 14000 100% 28000 28000 50000 50000 50000

Reserve & Surplus -759 -14.10% -652 3433 3779 9409 9116

Total Equity 13241 106.54% 27348 31433 53779 59409 59116

Total Assets 124057 16.31% 144291 219013 352899 492355 578700

-10000

0

10000

20000

30000

40000

50000

60000

70000

2012-13 2013-14 Q2 2014 2014-15 2015-16 2016-17

Tho

usa

nd

s

Share Capital And Reserves

Reserve & Surplus

Share capital

0

100

200

300

400

500

600

700

2012-13 2013-14 Q2 2014 2014-15 2015-16 2016-17

Mill

ion

s

Total Assets

Operating and Net Profits:

Actual (000) Projected (000)

2012-13 Change %

2013-14 Q2 2014 2014-15 2015-16 2016-17

Operating Profit -759 - 118 6147 14853 23605 19974

Net Profits -759 - 107 4107 9452 15021 12710

-5000

0

5000

10000

15000

20000

25000

2012-13 2013-14 Q2 2014 2014-15 2015-16 2016-17

Tho

usa

nd

s

Operaing and Net Profits

Operating Profit

Net Profit

Deposits and Investments:

Actual (000) Projected (000)

2012-13 Change % 2013-14 Q2 2014 2014-15 2015-16 2016-17

Deposits 544 1803.68% 10356 21329 51423 66850 86905

Borrowings 110000 -4.82% 104700 161028 209440 314101 376921

Investments 0 - 31800 31800 48480 61578 67735

Loans and Advances

14496 547.05% 93797 163411 240118 358489 430188

Actual (000) Projected (000)

2012-13 Change % 2013-14 Q2 2014 2014-15 2015-16 2016-17

Interest Income 471 2728.87% 13324 13776 32564 52914 70535

Interest Expenses 196 3143.37% 6357 3587 8985 15645 22275

Net Interest Income

276 2424.28% 6967 10118 23579 37269 48261

0

50

100

150

200

250

300

350

400

450

500

2012-13 2013-14 Q2 2014 2014-15 2015-16 2016-17

Mill

ion

s

Deposits, Borrowings and Loans and Advances

Deposits

Borrowings

Loans and Advances

Actual (000) Projected (000)

2012-13 Change% 2013-14 2014-15 2015-16 2016-17

Earnings Per Share -5.42 - 0.38 18.90 30.04 25.42

Book Net Worth Per Share

94.58 -3.27% 97.67 107.56 118.82 118.23

ROE -5.73% - 0.39% 17.58% 25.28% 21.50%

ROA -0.61% - 0.07% 2.68% 3.05% 2.20%

0

10

20

30

40

50

60

70

80

2012-13 2013-14 Q2 2014 2014-15 2015-16 2016-17

Mill

ion

s Interest Income Vs. Interest Expenses

Interest Income

Interest Expenses

-10

-5

0

5

10

15

20

25

30

35

2012-13 2013-14 2014-15 2015-16 2016-17

Rs.

Earning Per Share

-10.00%

-5.00%

0.00%

5.00%

10.00%

15.00%

20.00%

25.00%

30.00%

2012-13 2013-14 2014-15 2015-16 2016-17

ROE and ROA

ROE

ROA