NMB Laghubitta profit growth jumps 195 percent
8th February 2026, Kathmandu
NMB Laghubitta Bittiya Sanstha Limited has reported a staggering turnaround in its financial performance for the second quarter of the fiscal year 2082/83. According to the unaudited financial statements for the period ending Poush 2082, the microfinance institution achieved a net profit growth of 195.31 percent, signaling a robust recovery and an aggressive expansion in its core lending activities.
NMB Laghubitta profit growth
As a subsidiary of NMB Bank Limited, the institution has successfully navigated a challenging micro-credit environment to post a net profit of Rs 3.48 crore, up from Rs 1.18 crore in the same period last year. This nearly threefold increase in profit is a direct result of enhanced interest income and improved asset management.
Strategic Drivers of Profit Growth
The massive jump in profitability can be traced back to several key operational shifts during the first half of the fiscal year.
Net Interest Income Surge: The primary revenue engine for the company—net interest income—grew by 61.54 percent to reach Rs 28.31 crore. This indicates a more efficient deployment of capital and a higher interest spread compared to the previous fiscal year.
Operating Efficiency: Total operating income crossed the Rs 31.62 crore mark, a 60.23 percent increase. By keeping operational expenses in check while revenue expanded, the company saw its operating profit skyrocket by 195.74 percent to Rs 4.98 crore.
Asset Quality Improvement: One of the most encouraging signs for investors is the reduction in the Non-Performing Loan (NPL) ratio. NMB Laghubitta reduced its NPL from 5.96 percent to 4.83 percent. In a sector where bad loans have been a major hurdle, this 1.13 percentage point drop suggests better credit appraisal and more effective recovery mechanisms.
Shareholder Value and Valuation Metrics
The financial turnaround has significantly bolstered the company’s per-share metrics, making it a point of interest on the Nepal Stock Exchange (NEPSE).
Earnings Per Share (EPS): The annualized EPS has climbed to Rs 9.67, compared to a meager Rs 3.28 in the previous year. This reflects the direct benefit of the profit surge for the company’s shareholders.
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Net Worth and Reserves: The net worth per share currently stands at Rs 140.61. The company has maintained a stable paid-up capital of Rs 72.14 crore, while its total reserves and surplus have grown to over Rs 21.70 crore, providing a solid cushion for future growth.
Price-to-Earnings (P/E) Ratio: At the current market price (approximately Rs 677 as of early February 2026), the P/E ratio stands at roughly 75.59 times. While this is higher than the sector average, it reflects the market’s high growth expectations following this 195 percent profit jump.
Balance Sheet and Portfolio Expansion
The institution’s reach in the rural and semi-urban sectors is evident in its growing balance sheet. NMB Laghubitta has successfully collected Rs 1.77 billion in deposits from its members and leveraged that to disburse Rs 7.54 billion in loans. With total assets crossing Rs 8.54 billion, the company is now operating with a larger footprint than ever before.
The company’s liquidity position remains healthy at 11.92 percent, ensuring that it has enough cash on hand to meet immediate obligations while continuing its lending operations. Currently, the institution is led by Acting Chief Executive Officer Sajal Khadka, who has focused on promoting inclusive and sustainable financial access.
Challenges and Future Outlook
While the 195 percent growth is a major milestone, NMB Laghubitta faces a competitive landscape. The microfinance sector in Nepal is currently under scrutiny regarding interest rate caps and service charges. Maintaining this growth rate while adhering to Nepal Rastra Bank’s tighter regulatory framework will be the primary challenge for the remaining two quarters of 2082/83.
Furthermore, the institution must continue its focus on digital transformation. Integrating modern fintech solutions into its micro-lending model could further reduce operating costs and improve the customer experience for its rural clientele.
Conclusion
The Q2 report of NMB Laghubitta for FY 2082/83 paints a picture of a company in a high-growth phase. With a net profit of Rs 3.48 crore and a shrinking NPL ratio, the institution has proven its ability to generate value in a complex economy. For investors, the surge in EPS and operating income provides a strong fundamental case, though the high P/E ratio suggests that much of this growth is already priced into the stock.
As the institution moves into the third quarter, stakeholders will be watching to see if the reduction in non-performing loans can be sustained and if the net interest income continues its upward trajectory.
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