Shrijanshil Laghubitta Q2 Report Shows Rs 20.08M Loss
12th February 2026, Kathmandu
Shrijanshil Laghubitta Bittiya Sanstha Limited has officially published its unaudited financial report for the second quarter of the fiscal year 2082/83. The latest data reveals a challenging period for the institution, which reported a net loss of Rs 20.08 million for the period ending Poush 2082. This financial downturn highlights the significant pressures currently facing the microfinance sector in Nepal, including a broader economic slowdown and rising credit risks.
Shrijanshil Laghubitta Q2 Report
The reported loss is a sharp reversal from the net profit of Rs 18.74 million recorded during the same period in the previous fiscal year. This shift underscores the volatility inherent in the current microfinance landscape, where loan recovery and asset quality have become major operational hurdles.
Rising Non Performing Loans and Impairment Charges
A primary factor contributing to the net loss is the substantial increase in non performing loans (NPL). The NPL ratio has climbed to a concerning 14.79 percent, indicating that a significant portion of the institution’s loan portfolio is under stress. This rise in defaults is largely attributed to the ongoing economic difficulties faced by rural borrowers and organized protests against microfinance institutions that have disrupted traditional recovery mechanisms.
To account for these risks, Shrijanshil Laghubitta has been forced to set aside heavy impairment charges. For the current review period, the impairment charge for loan losses reached Rs 96.49 million. While these provisions are necessary for long term financial prudence and regulatory compliance, they have directly impacted the bottom line, leading to the reported net loss.
Core Financial Indicators and Revenue
Despite the net loss, the institution managed to maintain its core interest based activities. The net interest income for the period stood at Rs 86.81 million, derived from a total interest income of Rs 177.47 million against interest expenses of Rs 90.65 million. However, the high operating costs and impairment expenses ultimately outweighed the revenue generated from lending.
Total Operating Income: Rs 85.74 million
Personnel Expenses: Rs 43.81 million
Other Operating Expenses: Rs 14.55 million
Operating Loss: The institutional operating loss before impairment reversals stood at a level that necessitated a careful reevaluation of cost management strategies.
Impact on Shareholder Value and Ratios
The financial stress is reflected in the key performance ratios for shareholders. The earnings per share (EPS) has dropped significantly into negative territory, standing at Rs (36.75) on an annualized basis. This decline is a direct result of the net loss and the institution’s limited capital cushion during this period of high credit risk.
Net Worth per Share: Rs 240.02
Capital Fund to Risk Weighted Assets (CAR): 8.50 percent
Liquidity Ratio: 25.80
Cost of Funds: 13.12 percent
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While the net worth per share remains above the par value, the capital adequacy ratio is under pressure, hovering near regulatory minimums. Maintaining this ratio will be a key focus for the management in the coming quarters to ensure the institution remains compliant with Nepal Rastra Bank directives.
Balance Sheet and Asset Quality
The total assets of Shrijanshil Laghubitta stood at approximately Rs 2.999 billion as of Poush 2082. The asset base is primarily composed of loans and advances to members, which are now being managed with a heightened focus on quality over quantity. Total liabilities were recorded at Rs 2.737 billion, including deposits from members and borrowings from other financial institutions.
The institution currently serves over 41,000 active members through its network of 33 branches across 10 districts. The high credit to deposit and borrowing ratio of 333.88 percent indicates a heavy reliance on external borrowings to fund its microcredit operations, which contributes to the higher cost of funds.
Market Performance and Investor Sentiment
On the Nepal Stock Exchange (NEPSE), the shares of Shrijanshil Laghubitta (SHLB) have experienced volatility in line with the reported financial results. The last traded price as of the reporting period was Rs 1,590, with the stock trading between a 52 week high of Rs 2,907 and a low of Rs 1,540.20. The negative P/E ratio and the current loss have made investors cautious, though many are looking for signs of an effective recovery strategy and a reduction in the NPL ratio.
Strategic Outlook and Recovery Efforts
In response to these challenges, the management of Shrijanshil Laghubitta has outlined several strategic priorities. The institution is focusing on improving loan recovery through direct community engagement and financial literacy programs. Rather than pursuing aggressive expansion, the current strategy emphasizes consolidating the existing portfolio and enhancing the quality of new disbursements.
Furthermore, the institution is working closely with local authorities to mitigate the impact of microfinance protests and restore a culture of financial discipline among its members. Strengthening internal risk management and reducing operating costs are also central to the institution’s plan to return to profitability.
Conclusion
The Shrijanshil Laghubitta Q2 report for FY 2082/83 serves as a sobering reminder of the hurdles facing the microfinance industry in Nepal. The net loss of Rs 20.08 million and a high NPL ratio of 14.79 percent highlight the need for urgent structural and operational adjustments. While the institution maintains a presence in the rural economy, its path forward will depend heavily on its ability to manage credit risk and stabilize its financial position in a volatile economic environment.
For More: Shrijanshil Laghubitta Q2 Report
