Profitability of
Citizen Investment Trust
A Project Work Report
By
Binita Kumari Shrestha
T.U. Registered Number: 7-2-25-434-2020
Nepal Commerce Campus, New Baneshwor, Kathmandu
Group: Finance
Submitted to
The Faculty of Management Tribhuvan University Kathmandu
In Partial Fulfillment of the Requirements for the Degree of BACHELOR OF
BUSINESS STUDIES (BBS)
Kathmandu, Nepal
May 2025
Contents
1. Background Information..................................................................................................1
2. Profile of the Organization..............................................................................................1
3. Objectives of the Study....................................................................................................1
4. Literature Review............................................................................................................2
5.Research Methodology.....................................................................................................2
- Research Methods................................................................................................................2
- Population and Sample:.......................................................................................................2
- Types of Data:......................................................................................................................3
- Data Collection Procedure...................................................................................................3
- Method of Data Collection..................................................................................................3
- Tools Used:..........................................................................................................................3
6. Limitations of the Study..................................................................................................4
Bibliography........................................................................................................................5
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1. Background Information
Financial performance and liquidity are crucial indicators of a company’s financial
health. Financial performance can be measured using various financial ratios such as
Return on Assets (ROA), Return on Equity (ROE), and Earnings Per Share (EPS), while
liquidity reflects the ability of the firm to meet its short-term obligations. This study aims
to evaluate the financial performance and liquidity position of Citizen Investment Trust
(CIT), a government-owned financial institution in Nepal, by using these indicators to
assess its operational efficiency and sustainability over the past five fiscal years.
2. Profile of the Organization
Citizen Investment Trust (CIT), established on 18th March 1991 and operating since 15th
January 1992, is a prominent government-owned financial institution in Nepal. CIT is
primarily responsible for managing retirement schemes and mutual funds, aiming to
promote savings, enhance investment, and contribute to the economic development of
Nepal. The trust plays a key role in facilitating savings and investment opportunities for
the citizens of Nepal, particularly in the context of retirement planning.
3. Objectives of the Study
Main Objective:
To evaluate the liquidity and financial performance of Citizen Investment Trust (CIT).
Specific Objectives:
1. To analyze the liquidity position of CIT.
2. To assess the financial strengths and weaknesses of CIT.
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3. To examine the relationship between liquidity and profitability in CIT.
4. To analyze key financial trends of CIT over the last five years.
4. Literature Review
The literature review covers studies on liquidity, profitability, and financial performance,
with particular emphasis on investment trusts.
1. Lintner (1956) analyzed the relationship between net earnings and dividends in
financial institutions.
2. Adhikari (2006) focused on dividend instability in Nepalese banks.
3. Gill et al. (2010) studied the effects of debt, profitability, and dividends on
financial institutions.
4. Baral (2018) applied the CAMEL framework to assess the financial health of
Nepalese commercial banks.
5.Research Methodology
- Research Methods
This study will adopt a descriptive and analytical research design, focusing on evaluating
the liquidity and financial performance of CIT using secondary data.
- Population and Sample:
The study will focus on Citizen Investment Trust (CIT), specifically its financial
performance and liquidity during the past five fiscal years (2076/77 to 2080/81 BS).
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- Types of Data:
Secondary data will be used for this study. The data will be sourced from:
1. Annual reports of CIT
2. Financial publications by Nepal Rastra Bank (NRB)
3. Ministry of Finance reports
4. Published financial statements
- Data Collection Procedure:
Data will be collected from official websites, financial databases, and published
documents covering the last five fiscal years. The study will use documents such as
income statements, balance sheets, and cash flow statements.
- Method of Data Collection:
The study will use qualitative data derived from financial reports and quantitative data
from key financial ratios.
- Tools Used:
The following tools will be used for data analysis:
1. Financial Ratio Analysis: Return on Assets (ROA), Return on Equity (ROE), Net
Profit Margin, Earnings Per Share (EPS)
2. Trend Analysis: To assess performance over the five years
3. Graphical Representation: Charts and tables for visual data representation using
MS Excel
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6. Limitations of the Study
The study will rely only on secondary data, which may be subject to availability and
accuracy issues.
1. It will focus exclusively on Citizen Investment Trust (CIT), making it difficult to
generalize the findings to other similar institutions.
2. The analysis may not account for external factors such as changes in government
policy or macroeconomic factors that could influence CIT’s performance.
3. Time constraints limit the ability to conduct more in-depth field research.
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Bibliography
Adhikari, K. K. (2006). The Comparative Study of Dividend Policy and Practices of
Commercial Banks in Nepal.
Baral, K. J. (2018). Health Check-up of Commercial Banks in the Framework of
CAMEL.
Jothi, V. (2015). Financial Performance Analysis.
