IPO of Manakamna Smart Laghubitta

Manakamna Smart Laghubitta Bittiya Sanstha Limited (MSLBSL) was established in the Rupandehi district under the company Act 2063. They got the license from Nepal Rastra Bank as a ‘D’ level bank of Nepal. They got a license on 2074-06-25 BS and operated from 2074-11-06.

Currently, MSLBSL is providing services from 36 branches in Rupandehi, Nawalparasi, Kapilvastu, Arghakhachi, Palpa, Gulmi, Dang, Banke, and Brdiya districts. And they are planning to reach all 12 districts of Lumbini province within one year. There are 8 members in the management team and 5 members of the board of directors.

Empowering rural people for attaining self-sustaining socio-economic upliftment is the vision of this microfinance. To expand the branches all over Lumbini province IPO of Manakamna Smart Laghubitta Bittiya Sanstha Limited is coming from Ashad 3.

Financial Performance

Microfinance has positive results in Nepal. From 1st July 2021, MSLBSL is going to issue an Initial Public Offering (IPO) to the general public. MSLBSL is providing service in Lumbini Province for 4 years, and they have good goodwill. Financial indicators are the major benchmark for investment. Here are the company’s financial statistics:

S.N.Heading2076/0772077/078Expected 2078/079
1Authorized Capital68,250,000121,150,000121,150,000
2Reserve and Surplus7,396,00039,837,000105,174,000
3Outstanding Shares683,0001,212,0001,212,000
4Net worth Per Share  110.84132.88186.81
5Earning Per Share6.8526.5153.40
6Net worth Return6.18%19.95%28.58%
7Face Value of per share100100100
8Net profit/Loss4,677,00032,120,00064,690,000

Ownership Structure

Shareholder TypeNumber of SharesPercentage of ownershipAuthorized amount
Promoter Shares8,22,50067.89 %8,22,50,000
General Public3,89,00032.11 %3,89,00,000

IPO Details

More than 3 million Nepali citizens have DEMAT accounts and among them, more than 2 million were applied for Jeevan Laghubitta previously. Now, MSLBSL is going to issue 32.11% of 12,12,000 shares to the general public. The IPO details are as follows:

Number of shares to be issued:3,89,000 Shares
Price Per Share:Rs. 100
Shares to Employees (0.5%):6,058 Shares
Shares to Mutual Funds (5%):19,450 Shares
ICRANP Rating:BB-
Issued Capital:NMB Capital
IPO open Date:2078 Ashad 17 (B.S)
Close Date(Early):2078 Ashad 21 (B.S)
IPO Close Date(Late)2078 Ashad 31 (B.S)
Minimum Shares need to apply:10 Shares
Maximum Shares can apply:1000 Shares

Conclusion

In the last 1 year IPOs were always oversubscribed so apply just 10 shares. There will be more than 2.2 million applicants for MSLBSL shares and among them just almost 365000 applicants will get the 10 shares each. Therefore, apply just 10 shares. Also, microfinance has great goodwill in the Nepalese Stock Market.

So, if you get the share do not sell early because it might cross Rs. 3000 per share because we saw the history of Mahila Laghubitta. Mahila Laghubitta and Manakamana Laghubitta have similar kinds of financial performance. Currently, Mahila Laghubitta has a Rs 4700 market price so I suggest do not sell early if MSLBSL’s share allotted for you.

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