Nabil bank share price k cha bichar

Back of fag paper calculation, Current market around 160 billion
Earnings 32 billion per quarter, yearly would make around 128 billion, with profit around 5 billion per quarter
Share price around 586 seems like it’s trading around its 1.3 * it’s earning when other nepali stocks trades mostly 20-30 times it’s earnings. Seems like quite cheap based on it’s earnings n all also 30% cash n equity dividend. Looks good for long term hold. Current profit margin around 16-17% but with lower interest rate implementing by nrb might be slight fall in profit margin 14-15% in incoming quarter. Although nabil ko dealer license business has tremendous future if they start market making for nepse. Credit default rate might be high in last 2 yrs and in next 1-2 yrs but certainly made 5 billion in the quarter. I guess it depends on how much mark up values they are putting on default collaterals in balance sheet. Nepal macro picture is not so rosy yet with the budget throwing less government spending this year might be further less money circulating however with easing monetary policy credit might be slightly cheaper although inflation is still high n could be higher with all the new tax getting implemented, fuel price Kati ko ghataucha herum international oil price is quite low this has to surely feed into Nepal oil corp price ma. Tara k garnu Chor ko desh cha ghataune haina. Hence inflation high nai hola tehi bhayera interest rate ni high nai rakcha hola. Ek dui percent ghatla. Sarkar le kitta kat kholeko cha this might bring in some land buy/sell certainly good for banks too. Overall depending on how big are credit default rates and collateral mark up value in balance sheet. Malai cha thikai nai lagdai cha yo price range haru tira entry garnu might start buying in batches nepse ko alikati correction hola at this levels dekhi 2k level tira so might still further go down. Just my opinion. Like always dyor.

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  1. I dont know where you got the data about 30% dividend, last year NBB merger ma gayera distributable profit badeko thyo, this year it only has around 1.7 billion distributable profit as of Q3.

    Ani business side ma, your facts are wrong it doesnt earn 32 billion in a quarter, its cumulative as of Q3, not of Q3 so theres that. Ani net profit pani cumulative ho, quarter ma 5 billion kamako haina 9 mahina ma 5 billion kamako.

    Similar volume ko business garne gbime is trading at around 70 billion, well its paid up capital is huge but why pay 160 billion for a company when you can get similar business at 70 billion. Nica can be another alternative.

    Ani as stated on another reply espali M&A garera spread rate and tax benefit payera dherai profit kamako ho.

    well I remember you from the thread where you were hell bent on the market heading towards 1100, estai analysis garne vaye ta bearish market ma 1100 ani bullish market ma 6000 dekhne nai ho.

  2. Your entire calculation is based on false information that it’s trading at 1.3*it’s earnings, Nabil’s PE is about 25, not 1.3. Profit margin is slightly higher than other banks because Nabil is allowed to maintain spread rate of 5% until the end of this quarter.(Banks who go through merger/acquisitions are allowed to maintain spread rate 1% higher than limit set by NRB). Credit Default rate ta sab ko issue ho. I dont see commercials banks having NPL of 3/4% forever.

    One major issue faced by commercial banks in this country is scalability, if you look at their core business growth excluding merger/acquisition, they have a hard time maintaining it over 16% year in year out. Now with NRB watching them closely their margin will further decrease in the future meaning, it’ll be difficult for them to maintain growth rate anywhere near their business growth rate.

    So, to summarise, commercial banks arent a goodbuy if you’re buying it at a PE of 25+.

    Edit: Edited a bit to express what i mean.


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