Jalpa Samudayik Laghubitta Bittiya Sanstha Limited (JSLBSL) started joint operation in December 2020 following the merger of two regional level MFIs (viz. Jalpa Laghubitta Bittiya Sanstha Limited (JLBSL), 10-district MFI operating since March 2019 and Mahila Samudayik Laghubitta Bittiya Sanstha Limited (MSLBSL), another 10-district MFI operating since February 2019). JSLBSL has an NGO background with the takeover of microfinance businesses operated by FINGOs. JLBSL took over the microfinance business being conducted by Srijana Development Centre (SDC), an NGO, operating as a financial intermediary from 2003. Similarly, MSLBSL took over the microfinance business conducted by Nepal Women Community Service Centre (NWCSC), another NGO, operating as a financial intermediary from 2003
About the issue:
Jalpa Samudayik Laghubitta Sanstha Limited is issuing 5,22,000 units of ordinary shares worth Rs. 5.22 crores to the general public from Magh 21, 2078. The early closing date of this IPO issue is on Magh 25, 207. If the issue is not subscribed till Magh 25 then the issue can be extended to Falgun 06, 2078.
Out of offered 522,000 units; 0.5% of issue capital i.e., 8,000 units have been allotted for the employees of the company, and 5% of the total offered to the general public i.e., 26,100 units have been allotted for the mutual funds. The remaining 487,900 units are for the general public.
Applications can be placed for a minimum of 10 units and a maximum of 5,220 units.
Prabhu Capital Limited has been appointed as the issue manager for the IPO issuance.
After the IPO issue, public holding will be 32.63% and promoters holding will be 67.38%.
|Jalpa Samudayik Laghubitta Bittiya Sanstha Limited|
|Employees||0.5% of Issued capital||8,000||800,000|
|Mutual Fund||5% of IPO Shares||26,100||2,610,000|
|Public||30.49% of Issued capital||487,900||48,790,000|
|Issue Manager||Prabhu Capital Limited|
|Issue Open Date||21 Magh, 2021|
|Issue Closing date (earliest)||25 Magh, 2021|
|Issue Closing date (late)||06 Falgun, 2021|
ICRA Nepal has assigned the issuer rating of [ICRANP-IR] BB (pronounced ICRA NP issuer Rating Double B) to Jalpa Samudayik Laghubitta Bittiya Sanstha Limited. Issuers with this rating are considered to have a moderate risk of default regarding timely servicing of financial obligations.
- Adequate track record of operations and experienced management team
- Increased operational scale and geographical diversification through the merger
- Moderate capitalization profile
- Incremental asset quality concerns
- subdued profitability due to increased credit cost and higher cost to income ratio
- Low penetration of credit bureau in Nepalese MFI sector; risk of overleveraged borrowers remains high
- Regulatory risk
Source: ICRA Rating
|Current Paid-Up Capital||107,800,000|
|Capital after issuance of IPO||160,000,000|
|Shareholders||Shares Held||% Held||Total Amount||Status|
|Public Shareholders||522,000||32.63%||52,200,000||After issuance of IPO|
Board of Directors:
|Mr. Bir Bahadur Adhikari||Chairman|
|Mr. Arjun Shrestha||Director|
|Mrs. Gita Kumari Yogi Giri||Director|
|Mrs. Sushma Gautam||Director|
|Mr. Omkar Pandey||Independent Director|
|Loans and advances||1,157,325.27||1,192,984.60||4,653,519.71||5,308,189.00||6,292,135.00||7,381,050.00|
|Net Interest Income||43,222.31||113,844.99||177,257.68||344,587.00||411,903.00||507,407.00|
|Earnings per share||26.26||25.09||53.83||74.32||87.33||112.87|
|Book value per share||172.60||207.75||439.28||346.10||433.43||546.30|
|Return on Equity||15.21%||12.07%||12.25%||21.47%||20.15%||20.66%|
Microfinance is one of the most pursued sectors by investors in the Nepali Capital Market and one of the reasons is quick-to-market price appreciation. Now, that all the information is available, will you be applying for Jalpa Samudayik Laghubitta Bittiya Sanstha’s IPO?
The total shares floated by Jalpa Samudayik Laghubitta Bittiya Sanstha Limited is 522,000 units, of which only 487,900 units are available to the general public after the allocation of shares to staff and mutual fund.
If we see the recently concluded IPO, a total of more than 24 lakh applicants applied for the company IPO and we assume that the same or even more craze prevails in Jalpa Samudayik Laghubitta Bittiya Sanstha’s IPO too. Since the 10 kitta rule exists for IPO; 48,790 applicants will be lucky enough to get the shares of Jalpa Samudayik Laghubitta Bittiya Sanstha Limited.
Hence, if the same number of applicants (or more), i.e., 24+ lakhs apply for this issue then there is a high probability of lottery for 10 units. Since the minimum unit is 10, it is advisable to apply only 10 units in the IPO issue of Jalpa Samudayik Laghubitta Bittiya Sanstha Limited.