Guardian Micro Life Insurance Begins IPO with Promising Growth Prospects

Kathmandu – Guardian Micro Life Insurance Limited has commenced the first phase of its Initial Public Offering (IPO) from December 4, issuing 2.25 million ordinary shares worth Rs 225 million. This represents 30 percent of its total issued capital of Rs 750 million. In this phase, 10 percent of the shares, equivalent to 225,000, have been allocated for Nepalis working abroad. The remaining shares will be offered to the general public in the second phase.

The IPO marks a strategic step for the company, aiming to increase public participation and expand access to insurance services. However, prospective investors are advised to carefully evaluate the company’s financial performance and long-term potential before investing.

Guardian Micro Life Insurance has showcased notable financial growth. The company’s paid-up capital currently stands at Rs 525 million, with its life insurance fund matching this amount in the first quarter of the fiscal year. Net profit for the same period reached Rs 5.3 million, a significant increase compared to Rs 142,000 recorded in the corresponding period last year. Additionally, income rose to Rs 64.1 million, compared to Rs 13.7 million in the previous fiscal year’s first quarter, reflecting improvements in premium and interest income.

Despite this progress, the company faces challenges, particularly in its credit rating. Guardian Micro Life Insurance holds a CARE-NP-BB- rating, indicating an average ability to meet financial obligations and a need for improvement in its risk profile. The company acknowledges these challenges and emphasizes its commitment to enhancing operational efficiency and customer satisfaction.

In a bid to strengthen its business, the company has targeted rural and urban markets with new insurance products. The decision to offer shares to Nepalis employed abroad in the first phase is intended to encourage investment in productive sectors. The use of digital platforms such as Mero Share and C-ASBA has also made the IPO process more transparent and accessible.

Guardian Micro Life Insurance’s robust growth in net profit, income, and insurance premium earnings signals its potential for long-term stability. However, investors are advised to conduct a thorough assessment of the company’s financial reports and growth strategies before participating in this IPO.