[ad_1]
Kathmandu, May 27. The microfinance group has been bullish on the stock market over the past few months. Even as the market fell, the microfinance index continued to rise. Currently, the group’s index has reached a 16-month high.
The microcredit group index reached 4656 points. This figure is the highest in 16 months. Among the 12 groups in the stock market, the microcredit index has the largest increase in the past six months.
On December 20 last year, the Microfinance Group Index fell to 3,230 points. Since then, the Microfinance Index has increased by 44% in 6 months.
The prices of some companies in this group doubled. In a period of 6 months, the value of six microfinances doubled. The prices of some microfinances reached their all-time highs. A total of 53 microfinance companies are listed on the market.
Some of the microfinance companies with the highest growth rates in the past six months
Why do microfinance groups turn violent?
The main reason why microfinance companies grow faster than other companies is that this industry is easy for big businessmen. Big businessmen have the ability to easily influence certain companies. The number of shares issued to the public by medium-capital microfinance companies ranges from 10 to 2 million shares.
Some microfinance companies offer fewer than 100,000 shares to the public. Investors say the main reason for the rise in microfinance prices is the “low cap” effect.
“Investors are investing more wherever they can boost share prices,” said investor Tilak Koirala. “It seems microfinance is being developed strategically.”
Since microfinance is a low-market-cap company, once a large amount of funds are raised, it will affect the value of the company, so this industry is easier to operate than other industries. Even among microfinance companies, the value of companies with more paid-in capital has not increased. But the value of microfinance with medium and low paid-in capital is growing at a high speed.
“Those companies that can easily increase their prices, traders/investors seem to gravitate towards these companies and that is why microfinance companies with a lot of capital have not been able to grow,” Koirala said.
The crowd of traders and investors increased after this sector index performed best when other sector indicators fell. Investors said that the price had reached a very low point in November, but the growth rate in the short term was good.
Another investor, Subashchandra Dhakal, said: “Some groups in Mansir/Pusata staged protests against microfinance companies.”
Most microfinance companies also reported bad financial statements in the first quarter of this year. The increase in non-performing loans was due to failure to pay interest and principal on time.
When prices hit their lows, some people began to “average” the value of companies in their portfolios. Some increased their purchases, hoping that prices would rise. Gradually, it became increasingly difficult to spread chaos and protest against microfinance companies.
Although there was no significant improvement in the second quarter financial statements of microfinance companies, Baisak’s third quarter financial statements showed good improvement. Due to the increase in the amount of uncollected principal and interest and the increase in profits, businessmen and investors showed more enthusiasm for microfinance companies.
He said that although Locap went bankrupt, it would not take much time to recover. Once large merchants increased their purchases, the supply of these companies would not be able to keep up, leading to price increases.
The crowd of traders and investors increased after this sector index performed the best while other sector indicators rose. Although the indicators of other sectors did not show good signs, businessmen are accelerating the microfinance sector here.
[ad_2]
Source link
