Top 5 Blue Chip Company Of Nepal With Minimal Spending

Blue Chip company are those company which has the best management team, a long history, good reputation and goodwill in the market, great sustainability, and sound financial performance. Investment in the blue-chip company is the safest landing for the investor in a bullish and bearish market. In short language, this type of company is the most reliable and profitable.

There are more than 260 companies are listed on Nepal Stock Exchange under 12 different categories. Among the 12 categories, in this article, Hydropower companies, and the hotel & tourism sector are not listed as blue-chip companies, because hydro stocks are not performing well consistently and the hotel and tourism sector’s company does not have standard EPS and dividend history.

Best Blue Chip Stocks to Buy in Nepal in 2022

There are many good companies in Nepal. Many companies are giving consistent dividends to their shareholders, have good provisional and reserve funds, consistent growth in net profit, and their investment in productive business.

Unilever Nepal Limited (UNL), Salt Trading Corporation (STC), Citizen Investment Trust (CIT), Himalayan Distillery Limited (HDL) are the top and best companies listed in NEPSE, but we are not going to talk about that because they are too expensive in the market.

Here, we will take 5 different companies from five different categories. In the commercial banking sector, there are a couple of good banks which can count as blue-chip stock: Global IME Bank Limited (GBIME), Nepal Investment Bank Limited (NIB), Nabil Bank Limited (NABIL), and NIC Asia Bank Limited. Among the top 5 blue-chip companies of Nepal, NABIL is the first one because it is dominating the market with its handsome performance.

1. Nabil Bank Limited (NABIL):

It is the first joint venture and private bank of Nepal. The bank was established on 12th July 1984 with the name of Nepal Arab Bank limited. It is one of the most reputed bank of Nepal with a top management team that is providing financial services all over Nepal through 118 branches. NABIL bank is carrying the banking history of Nepal and this bank played a significant role to increase banking literacy all over Nepal.

S.NTitlePerformance
1Market Price:Rs 1309
2Listed Shares:134,801,590.00
3Earning Per Share (EPS):36.40
4Book Value:230.02
5Price/Earning Ratio (P/E ratio):35.96
6Cash dividend of last 5 fiscal year:1.76%, 22%, 22%, 18%,15%
7Bonus Share of last 5 fiscal year:33.50%, 12%, 12%,30%,30%
8Total paid up value:13,480,159,000.00

From 2042 B.S. onwards, this bank is increasing its goodwill to shareholders and customers. Currently, the market price of this bank is higher because of the bullish market. Although the price is higher it will give the benefit to their shareholders in long run.

2. Shikhar Insurance Company Limited (SICL):

This company is one of the best companies to buy in the non-life insurance category. The main goal of this company is to provide quality service that exceeds customers’ expectations. This company was started by a young team of reputed Industrial and business houses on Mansir 2, 2061.

S.NTitlePerformance
1Market Price:Rs 2154
2Listed Shares:17,585,240.00
3Book Value: 
4Earning Per Share (EPS):27.55
5Price/Earning Ratio (P/E ratio):78.19
6Cash dividend of last 5 fiscal year:1.46%, 1.46%, 1.53%, 3.16%
7Bonus Share of last 5 fiscal year:27.76%, 27.77%, 29%, 29%, 60%
8Total paid up value:1,758,524,000.00

In the current scenario, the stock market price of this company is high but buy and hold for the long term will give a good return to investors.

3. Nepal Life Insurance Company Limited (NLIC):

This is the life insurance company established by a private group on 21st Baisakh 2058. It was established under the company act 2053 and the insurance act 2049. The company insured itself with the ‘Hannover Re-Life Insurance Company, Germany’. This company is safer for investment because they have a good reputation with sound financial performance.

S.NTitlePerformance
1Market Price:Rs 2088
2Listed Shares:71,999,706.00
3Book Value:115.60
4Earning Per Share (EPS):9.38
5Price/Earning Ratio (P/E ratio):222.60
6Cash dividend of last 5 fiscal year:1.31%, 1.32%, 28.53%, 23.50%, 20%
7Bonus Share of last 5 fiscal year:25%, 25%, 42%, 25%, 31%
8Total paid up value:7,199,970,600.00

however, they have low EPS and a high P/E ratio which is not good for the investor. But they do have a good amount of paid-up capital and consistent in dividend distribution so, this company’s stock is taken as a blue-chip stock.

4. Chhimek Laghubitta Bittiya Sanstha Limited (CBBL):

CBBL has great market potential in the microfinance sector. They have a consistent growth rate since they established. It was established in 2002 AD. NABIL (11.98%), BOKL (9.98%), HBL(11.98%), Neighborhood Society Service Centre (12%), Individual Shareholders (12%), and Public Shareholders (35.35%) are the owner of CBBL.

S.NTitlePerformance
1Market Price:Rs 1784
2Listed Shares:18,300,000.00
3Book Value:258.52
4Earning Per Share (EPS):69.65
5Price/Earning Ratio (P/E ratio):25.61
6Cash dividend of last 5 fiscal year:12.70%, 25.11%, 12.70%, 17.22%, 7%
7Bonus Share of last 5 fiscal year:40%, 40%, 19.89%, 27.12%, 22%
8Total paid up value:1,830,000,000.00

This is the undervalued stocks in this category. There is many Microfinance in which market price is more than Rs 2000 but they do not have good financial status. Furthermore, this is the best stock to buy in today’s market. The strong ownership structure, good investment, great management with staff, and consistent growth is the major reason to put this company’s stock as a blue chip company of Nepal.

5. Muktinath Bikas Bank Limited (MNBBL):

This is a development bank categorized under ‘B’ level bank in Nepal Rastra Bank. It was established on 3rd January 2007. It was established with the aim of serving in three districts only. Today, MNBBL has 155 branches all over Nepal with more than 22 ATMs across the country.

S.NTitlePerformance
1Market Price:Rs 566
2Listed Shares:48,115,508.00
3Book Value:138.43
4Earning Per Share (EPS):27.87
5Price/Earning Ratio (P/E ratio):20.31
6Cash dividend of last 5 fiscal year:1.05%, 0.96%, 0.93%, 4.26%
7Bonus Share of last 5 fiscal year:34%, 20%, 18.25%, 17.60%, 11.25%
8Total paid up value:4,811,550,800.00

Also, This bank is doing so good in the eye of shareholders and customers. Consistent dividend distribution and high EPS is the major reason to put this bank as a top 5 blue chip company of Nepal.

FAQ on Top 5 Blue Chip Company Of Nepal

  1. What is Blue Chip Companies?

    Blue Chip company are those company which has the best management team, a long history, good reputation and goodwill in the market, great sustainability, and sound financial performance.

  2. What is an example of a Blue Chip Company?

    In the context of Nepal, Nabil Bank Limited, Nabil Bank Limited, Nepal Life Insurance Company are examples of Blue chip companies.

  3. Why to Invest in Blue Chip Company?

    Investment in the blue-chip company is the safest landing for the investor in a bullish and bearish market. In short language, this type of company is the most reliable and profitable.

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3 thoughts on “Top 5 Blue Chip Company Of Nepal With Minimal Spending”

  1. After reading this post, I got good knowledge of bluechip company. Thank you for explaining the meaning of bluechip compay. Your list of top bluechip company is also valuable for readers.

    Reply
  2. I am new in sharemarket. I was searching for good companies to invest money. Your post made my task easier. Thank you.

    Reply

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