Checkout the stocks with market price below or near Book Value !!!


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Currently the benchmark index of the only stock exchange of our country is in a downward trend. The stock price of almost every listed companies are continuously slipping down. This downward trend started since the market kissed the all-time high, and still have shown no sign of reversal. Majority of investors entering the market at that time are now in loss and have no option other than booking loss, averaging cost or waiting for the next bull.

The daily average turnover clearly shows less excitement in the market. A fear among the investors still seem to persist, as investors opt for “wait and watch” strategy. But as many veteran investors suggest, “Buy when everyone is selling, and sell when everyone is looking to buy”, this can be a good entry point for long term investors. At the time when market is bleeding, there are many stocks that have come below their intrinsic value.

It is now among the investors to look for such stocks and take a buy position. One can apply various valuation models to choose the best stock to invest. If not, one can even apply the conventional model of selecting stocks with high EPS and low P/B and P/E.

Where P/E compares the stock price with the earnings, P/B ratio compares the share price with the book value per share. Book value is nothing but shareholder’s equity. Or say, the sum of capital and the reserves. A stock might be considered under-valued if the book value exceeds its market price.

In this bearish market, we can find a lot of companies with stock price near or below the book value. To ease the investors, we have compiled the data and presented below.

 

S.No.

Company

Symbol

Stock Price

Book Value

P/B Ratio

1

Pokhara Finance

PFL

134

151.46

0.88

2

Central Finance

CFCL

114

126.32

0.90

3

Reliance Finance

RLFL

122

133.70

0.91

4

Lumbini Bikas Bank

LBBL

146

146.61

1

5

Gurkha Finance

GUFL

109

137.57

0.79

6

Karnali Bikas Bank

KRBL

112

131.08

0.85

7

Shree Investment & Fin.

SIFC

163

159.99

1.01

8

ICFC Finance

ICFC

173

130.41

1.32

9

Manjushree Finance

MFIL

123

120.18

1.23

10

Janaki Finance

JFL

168

146.61

1.14

11

Guheswari Merchant

GMFIL

131

117.70

1.12

12

Saptakoshi Development

SKDBL

120

109.14

1.10

13

Kankai Bikas Bank

KNBL

125

115.4

1.08

14

Hamro Bikas Bank

Hamro

134

124

1.08

15

Bhargav Bikas Bank

BHBL

130

124.88

1.04

16

Sindu Bikas Bank

Sindu

144

122.58

1.17

17

Nepal Community Dev.

NCDB

122

117.02

1.04

18

Jebils Finance

JEFL

100

108.49

0.92

19

Goodwill Finance

GFCL

120

117.55

1.02

 

Note: The above data is taken from the 3rd quarter report published by the company. The right or bonus shares, if issued, is not adjusted in the book value.

Though the above data can help in selecting stocks, this should not be taken as the sole instrument to choose stocks for investment. Combining the above data with various other indicators can provide the best result.  

   

  





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