Sadhana Laghubitta Bittiya Sanstha (SDLBSL), a leading Nepali microfinance institution, has released its third-quarter report for the current fiscal year, revealing a remarkable surge in its net profit. The company’s financial performance during the review period has been nothing short of impressive, with its net profit soaring by a staggering 365.85% compared to the corresponding period of the previous fiscal year.
According to the report, SDLBSL recorded a net profit of Rs 61.2 million, a significant increase from the Rs 13.1 million reported during the same period last year. This exceptional growth can be attributed primarily to a substantial decrease in impairment charges, despite only a minimal increase in net interest income.
During the review period, the company’s net interest income grew by 25.90%, while its net fee and commission income rose by 21%. Similarly, SDLBSL’s total operating income witnessed a 20.97% increase, reflecting the institution’s robust financial performance.
One of the key factors contributing to SDLBSL’s impressive net profit growth was the substantial reduction in impairment charges. The company’s impairment charges declined from Rs 25.8 million to just Rs 0.73 million, indicating improved asset quality and effective risk management practices.
However, it is noteworthy that the company’s non-performing loans (NPLs) increased to 4.10% from 3.77% during the review period. Despite this slight increase in NPLs, SDLBSL’s overall financial health remains strong, with a distributable profit of Rs 21.9 million.
The company’s impressive financial results have translated into attractive returns for its shareholders. During the review period, SDLBSL reported an Earnings per Share (EPS) of Rs 21.35, a net worth per share of Rs 148.08, and a Price-to-Earnings (P/E) ratio of 34.42 times, reflecting the company’s strong profitability and growth potential.
With a paid-up capital of Rs 382.2 million and a robust reserve fund of Rs 183.7 million, SDLBSL’s financial position remains solid. The company’s deposit base grew to Rs 5.08 billion, while its loan portfolio expanded to Rs 5.53 billion, indicating its commitment to supporting micro-enterprises and fostering financial inclusion in Nepal.
SDLBSL’s exceptional performance in the third quarter of the current fiscal year has positioned it as a frontrunner in the Nepali microfinance sector. As the company continues to focus on sustainable growth, prudent risk management, and innovative financial solutions, it is poised to play a pivotal role in driving economic development and promoting financial inclusion across the nation.
