Market Watch, Stock News

Pathibhara Bikas Bank IPO starts from 24 Nov 2009

Published by Octron on November 24, 2009

Pathibhara Bikash Bank is floating its primary issue to general investors in order to collect Rs. 24500000 from 245000 units ordinary shares at face value of Rs. 100. Pathibhara Bikas Bank Limited has Registered Central Office located at UrlaBari VDC, Morang, Koshi. It is licensed as “B” Class Financial Institution from NRB. It has area of operations in Jhapa, Morang and Sunsari of Mechi and Koshi District. The IPO has been released by NMB Bank and you can click here to see list of collection centers.

Click here to view the announcement notice

This is the fifth initial public offering by the company in home nation within couple of months. Before Pathibhara, Miteri Development Bank, Mahakali Development Bank, Asian Life Insurance Company and Kasthamandap had offered IPOs. Amid the growing stress in political and bearish secondary market, investors’ enthusiasm towards IPOs has emerged vigorously. Investors are keen to invest in any IPOs even without analyzing the fundamentals or any technical parts with a belief of maximum return if allotted (This has been proved by earlier trade at Nepse after IPO).

Capital Structure and Ownership Composition after Allotment:

Authorized Capital: Rs.10,00,00,000
Promoter Shares: Rs.2,55,00,000 (51%)
Public Shares: Rs.2,45,00,000 (49%)

IPO Date:

Opening Date: 24th November 2009 (2066 Mangsir 9)
Closing Date: 27th November 2009 (2066 Mangsir 12) (Sooner), 8th December 2009 (2066 Mangsir 23) (Later)

Financials

All figures are in ’000

Particulars	Actual		2066/67 (Projected)
	2064/65	2065/66	2066/67	2067/68	2068/69
Paid Up capital	25,500.00	25,500.00	50,000.00
Reserve & Surplus	-379	2,028.00	8,134.00
Book Net worth	25,121.00	27,528.00	58,134.00
No. of Shares (‘ 000)	255.00	255.00	500.00
Per Shares Networth	98.51	107.95	116.27
Net Profit	-379	2,407.00	5,727.00	13,399	20,233
EPS	-1.48	9.44	11.45

Performance: Despite the early loss of Rs.379,000, Bank has been able to earn 9.44% profit in last F\Y. It has projected the Net Profit to surge by 37.93% which is a great result, with increase in paid up capital by 96% at the middle of the year.

Future Expectation: After allotment, its issued capital will be Rs. 50 Millions which is really low in comparison to other counterpart. So this Bank would definitely increase its paid up capital to its current full extent of Rs.100 Millions which is possible only through right issue. Other than right, by the end of this F\Y, it would be able enough to provide around 10% of Cash dividend or Bonus Shares (Computed on the basis of projected figures).

Strategy: If Bank remains efficient enough to maintain current rate of return with further increment in capital then this is the scrip you can hold for long term. But if you are applying with the mindset of realizing profit soon then you can get rid of it on its listing. Assuming current fundamental situations prevails its net realizable value won’t change much whether you hold for long term or for short term.

Click here to view the announcement notice

Source: Jamb

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