Ganapati Laghubitta Q3 Performance: Strong Turnaround Backed by Profit Surge and Improved Fundamentals

Ganapati Laghubitta has posted an impressive financial performance in the third quarter of fiscal year 2081/82, showcasing a significant turnaround compared to the same period last year. The microfinance institution reported a net profit of Rs. 23.31 million, a massive growth of 171.71% from Rs. 8.57 million in Q3 2080/81. This surge in profitability is primarily attributed to a more than fourfold increase in net interest income, which jumped from Rs. 25.37 million to Rs. 120.12 million — a whopping 373.28% increase.

The company’s operating profit also saw a similar upward trajectory, climbing 171.71% to Rs. 33.30 million from last year’s Rs. 12.26 million. This growth reflects both improved revenue and effective cost control, despite a 10.93% increase in personnel expenses. Meanwhile, impairment charges dropped significantly by 63.56%, which suggests an improvement in asset quality or better provisioning strategies.

On the balance sheet front, borrowings rose by 15.06% to Rs. 1.66 billion, indicating higher reliance on external funding, possibly to support lending growth. However, customer deposits slightly declined by 0.78%, standing at Rs. 471.55 million, hinting at a potential challenge in mobilizing deposits amidst tighter liquidity in the banking system.

Despite this, the company grew its loan portfolio by 6.31%, reaching Rs. 2.21 billion in loans and advances to customers. However, the increase in loans came at the cost of rising non-performing loans (NPL), which now stand at 5.94%, up from 4.94% — a 20.24% rise, signaling some credit quality concerns.

The company’s retained earnings position flipped from negative to positive, improving from a deficit of Rs. -5.10 million to Rs. 17.74 million, boosting the internal financial strength of the institution. Reserves also grew by 9.10%, reinforcing the capital base.

Ganapati Laghubitta maintained a Capital Adequacy Ratio (CAR) of 8.61%, slightly higher than the previous year, and improved its Cost of Fund significantly, reducing it from 9.81% to 7.57% — a 22.83% reduction, improving margin sustainability going forward.

From a shareholder perspective, Earnings Per Share (EPS) rose from Rs. 7.55 to Rs. 20.51, and Net Worth Per Share increased by 13.42% to Rs. 164.80. The company’s quarter-end market price stood at Rs. 1,614.34, with a notably high PE ratio of 78.72 times, reflecting strong investor confidence or speculative valuation.

Overall, Ganapati Laghubitta has delivered a solid financial recovery and growth story this quarter, although rising NPLs and slight deposit contraction remain areas to watch. The results signal better profitability, operational efficiency, and capital health — a promising outlook for both the institution and its investors.