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The IPO of three of these companies, which has been approved by the regulatory body of the Bangladesh Securities and Exchange Commission (BSEC), has been finalized.
Among them, Robi Axiata, the second leading company in the telecommunications sector, brings the largest initial public offering in the history of the country’s capital market. The company will raise 523 crore 69 lakh 33,340 rupees.
All three companies, including Dominic Steel Building Systems Limited and Crystal Insurance Limited, will raise money on a fixed price method.
The collection schedule for the remaining six was not correct. Their Tawfiqa Foods and Agro Industries and e-Generation come with a fixed price method.
The other four, Mir Akhter Hossain, Lube-Ref Bangladesh, Index Agro Industries and Energypack Power Generation, will raise money through the book building method.
Although the impact of many IPOs has caused the capital market to decline slightly in the short term, there is no disagreement among those concerned about the long-term impact of a quality IPO.
However, considering the risk of the capital market, experts recommend investing with a long-term plan to verify if the company is fundamentally sound, be it an initial public offering or a secondary stock.
Ahmed Rashid Lali, managing director of the brokerage house Rashid Investment Services Limited, told bdnews24.com that to understand the company, you first have to look at the entrepreneurs; Good company if you have good people. It remains to be seen whether the company’s sales and profits have increased in the last year; We have to see what the dividend payment rate is and if it is increasing.
“What is your future?” No company has made a profit before, okay. But we have to see if we can make a profit in the future. “
Good institutional governance in the verification of fundamental companies as advised by the regulatory body; The amount of resources and their proper use; The practice of paying dividends and their fees; If the annual general meeting and the opinion of the shareholders are important; The company’s profit, earnings per share, net assets per share and its positive growth; Consideration should be given to whether all price sensitive information is disclosed in a timely manner and whether the company is managed in accordance with all laws and regulations relating to securities.
The following is basic information on the companies that have been allowed to issue IPOs in the capital market.
Dominance Steel Building Systems
Dominic Steel Building Systems, an engineering company, will raise Rs 30 crore on the capital market on a fixed price method. The collection of the subscription money ended on October 25.
In the audited financial report, Domino’s Steel showed a gain of Tk 9 crore 8 lakh in 2019. In the previous two years, it has shown a gain of Tk 9 crore and Tk 9 crore 80 lakh respectively.
According to the 2019 financial report, the total assets of the company are 153 crore. The return on assets has been 7.32 percent.
If the company’s net profit margin is 15.32 percent or Rs 100, the profit is Rs 15 32 paise.
Return on assets is a measure of a company’s efficiency in using assets. And the company’s net profit margin highlights its ability to make a profit. The more of the two, the better the company.
Mohammad Shamsul Islam is the Chairman of the Board of Directors of Domino’s Steel Building Systems and Mohammad Rafiqul Islam is the Managing Director.
Crystal Insurance Limited
Crystal Insurance will also increase Rs 16 crore through the fixed price method. The collection of the subscription money will begin from November 10.
The company has shown a profit of 6 crore 2 lakh in 2019. Previously, a profit of Tk 8 crore 23 lakh has been shown for two consecutive years.
According to the financial report, the total assets of Crystal Insurance are Tk 105.56 crore. Return on assets 6.84 percent; The net profit margin is 13.30 percent.
Abdullah Al-Mahmoud is the Chairman of the Board of Directors of Crystal Insurance Limited.
Robi Axiata
Robi Axiata will raise 523 crore 89 lakh 33,340 rupees on the fixed price method. The collection of the subscription money will begin on November 10.
In 2019, Robi has shown a profit of 16 crore 98 lakh rupees. Previously, two years in a row, the benefit has been 14 crore 73 lakh and 10 crore 47 lakh.
According to the 2019 financial report, Robi’s total assets are 16,198 crore taka. Return on the decimal asset 10 percent. This means that using the assets of 100 rupees a profit of 10 paise has been made.
Robi’s net profit margin is 23 percent. In other words, the sale of 100 rupees has generated a profit of 23 paise.
Chairman of the Board of Directors of Robi Axiata Mohammad Ijazuddin bin Idris and Managing Director Mahatab Uddin Ahmed.
Taufika Foods and Agro Industries
Tawfiqa Foods and Agro Industries will raise 30 million rupees on a fixed-price method. The company has not yet decided on the day of the fundraiser.
The company has spent Tk 6 crore 16 lakh, Rs 4 crore 25 lakh and only Rs 25 lakh in the previous three years as of 2019.
Taufika Industries started operations in 2016. Sales were around 6 crore rupees that year, the loss was one crore 70 lakh rupees. Tawfiqa saw its first profit the following year. This year the profit was Tk 25 lakh from the sale of Tk 48.
According to the 2019 financial report, the total assets of the company are 173 crore. Return on assets 3.69 percent; The net profit margin is 7.8 percent.
Shamima Nargis Haque, President of Taufika Foods and Agro Industries and Ekramul Haque, Managing Director.
Electronic generation
The IT company will increase Tk 15 crore using the fixed price method of electronic generation. The company may withdraw money from the market any day it wishes.
The company has shown a profit of 10 crore 90 lakh, 10 crore 49 lakh and 6 crore 8 lakh in the previous three years as of 2019 respectively.
According to the 2019 financial report, the company’s total assets are 131 crore 25 lakh rupees. The return on assets is 7.30 percent. The net profit margin is 29.95 percent.
E-Generation President Syeda Kamrun Nahar Ahmed and Managing Director Shamim Ahsan.
Mir Akhter Hossain Limited
Mir Akhter Hossain Limited has been allowed to raise Tk 125 million rupees from the capital market using the book making method. The date to lift the IPO has yet to be set.
The cut price for Mir Akter’s shares has been set at 80 Tk. Ordinary investors will get shares at 10 percent less than this.
The company has shown a profit of Tk 83.25 crore, Tk 61.06 crore and Rs 52.91 crore in the previous three years as of 2019 respectively.
According to the 2019 financial report, the total assets of Mir Akter Hossain Limited are Rs 1,899 crore; Return on assets 3.62 percent, net profit margin 14.62 percent.
Sahela Hussain, Chairman of the Board of Directors of Mir Akter Hossain and Mir Nasir Hossain, Former President of FBCCI, Managing Director.
Lube-Ref Bangladesh
150 crore in the Lube-Ref Bangladesh book construction method. The Lub-Ref Bangladesh cut-off price is exactly Rs 30.
Ordinary investors will get shares at 10 percent less than this. However, the pickup day was not the right one.
The company has shown a profit of Tk 20 crore 8 lakh, 20 crore 45 lakh and 15 crore 7 lakh in the previous three years in 2019, respectively.
According to the 2019 financial report, the total assets of Lub-Ref Bangladesh are 504 crore 63 lakh taka; The return on assets is 4.11 percent and the net profit margin is 13.54 percent.
Ms. Rubia Nahar, President of Lube-Ref Bangladesh and Mohammad Yusuf, Managing Director.
Index Agro Industries
Index Agro Industries will increase Rs 50 crore in book construction method. The bidding for the cut price will begin on November 1.
Index Agro has shown a gain of Tk 26.57 crore, Tk 26.52 crore and Tk 21.45 crore in the previous three years as of 2019, respectively.
According to the 2019 financial report, the company’s total assets are 316 crore 12 lakh taka; Return on assets 7.8 percent and net profit margin 7.36 percent.
Mazharul Quader, President of Index Agro Industries, and Mahin Bin Mazhar, CEO.
Energypack Power Generation Limited
In the book building method, Energypack Power Generation Limited will raise Rs 150 crore from the market. The day of the fundraiser is not over yet.
Energypack Power Generation Limited has a cut price of 35 Tk. Ordinary investors will be able to buy shares at 10 percent less than this.
Energypack has shown a gain of Tk 46.99 crore, Tk 45.35 crore and Tk 30.46 crore in the previous three years starting in 2019, respectively.
According to the 2019 financial report, Energypack’s total assets are Tk 3,204 crore; The return on assets is 1.50 percent and the net profit margin is 3.33 percent.
Rabiul Alam, President and Humayun Rashid, Managing Director of Energypack Power Generation Limited.
Many investors can sell their shares to buy these IPOs. So the capital market index can fall under pressure to sell.
Mohammad Emran Hasan, CEO of Shanta Asset Management Limited, told bdnews24.com that everyone wants to get those shares in hopes of making a profit when the IPO hits the capital market. Because the price of new shares in Bangladesh goes up a lot in the beginning. However, this effect lasts for less time. That gets better later.
“Even if the IPO lowers the index in the short term, it’s good for the capital market. Because the more IPOs that come up, the deeper the capital market will be. As the depth increases, the chances of manipulation will decrease.”
Only one IPO application has been submitted since Shibli Rubaiyatul Islam, a professor in the Department of Banking and Insurance at Dhaka University, took over BSEC on May 17 this year. All approved IPOs are from previous commissions.
So far this year, Associated Oxygen has raised Tk 15 crore, Express Insurance Tk 27 crore 8 lakh 90 thousand and Walton Hi-Tech Industries Limited Tk 100 crore.
In 2019, nine companies raised Rs 540 crore by issuing IPOs on the capital market. In the previous year, 12 companies raised capital of Rs 501 million Tk after obtaining approval to issue IPOs.
Shakil Rizvi, director of the Dhaka Stock Exchange (DSE), told bdnews24.com that more and more IPOs should be allowed for the long-term good of the capital market. However, the value of the IPO must be good. The BSEC may consider criminal action against the case manager for negligence in ensuring the quality of the IPO.
“In India, IPOs for four or five companies are sometimes dated at the same time. Good companies get financing, bad companies don’t get financing. But in our country it is saved ”.
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