The New Nation - Internet Edition

BUSINESS REPORT

Many companies have gradually been coming to the capital markets.

First Security Bank Ltd, one of the biggest private commercial banks, joined the capital market last month through floating initial public offering (IPO).

Titas Gas, one of the biggest companies in the public sector also joined the capital market through direct listing last month. However, ordinary investors at the share markets are now facing a very bad time as downward trend in stock prices have been continuing over the last couple of months. They are now in great risks buying shares at higher prices. In such a situation, six companies of different sectors are coming to the markets with the IPOs worth Tk 56 crore. These conpamies are going to enter the capital markets within the next two months. These companies have already finalized the dates for mobilizing funds. The companies which will collect funds from people through IPOs are Summit Alliance Port Ltd (Tk 10 crore), Takaful Islami Insurance Company Ltd (Tk 9 crore), Standard Insurance Ltd (Tk 9 crore), Northern General Insurance Company Ltd (Tk 9 crore), Republic Insutrance Company Ltd (Tk 9 crore) and Max Spinning Mills Ltd (Tk 8 crore).

Summit Alliance Port Ltd started mobilizing funds from August 10 last. The last date of application for IPOs was August 14. However, the time-limit for the non-resident Bangladeshis (NBRs) has been extended to August 23. Each of the 50 shares in a single lot has been fixed at Tk 100. The paid-up capital of the company is Tk 40 crore. It will stand at Tk 50 crore after mobilizing funds through the IPOs. Anjuman Aziz Khan, who is the director of Summit Power, another listed company, is the chairperson of the Summit Alliance Port.

Takaful Islami Insurance Ltd will mobilize funds through IPOs from August 25 to August 31. The last date of application for IPOs for the NRBs is September 9. The company has offered 50 shares in each lot and the price of each share has been fixed at Tk 100. Its paid-up capital is Tk 6 crore, which will stand at Tk 15 crore after mobilizing funds from the capital markets. The income per share (IPS) till December 2007 was Tk 25.09, while the net asset value of each share is Tk 140.34. Fazle Azim, chairman of the Capital Credit Cooperative Society Ltd is the chairman of this company.

Standard Insuance Company Ltd will collect funds through IPOs from September 7 to 11 locally, while funds from the NRBs will be mobilized from September 7 to 20.

The company's paid up capital will stand at Tk 15 crore after mobilizing funds through the IPOs. The company offers 9 lakh ordinary shares of Tk 100 each and plans to mobilize Tk 9 crore through the IPOs. HTM Quader Newaz is the chairman of this company.

Northern General Insuranec Company Ltd offers 9 lakh ordinary shares of Tk 100 each (at par) totaling Tk 9 crore. The opening date of the subscription for general public is September 14 and the closing date is September 18, while subscription for NRB applicants will remain open till September 27. The company has 22 branches across the country. Alhaj Nasir Uddin, vice-chairman of Social Investment Bank Ltd is the chairman of this company.

Max Spinning Mills Ltd, a company of the textile sector, will mobilize funds from general public through IPOs from October 12 to 16, while from the NRBs from October 12 to 25. Price of each of the shares has been fixed at Tk 10, while there will be 50 shares in each lot. The paid up capital of this company is Tk 30 crore, which will stand at Tk 38 crore after the IPOs. The company is mobilizing Tk 8 crore from the capital market to repay the bank loans.

Republic Insurance Company Ltd will mobilize funds through offering 9 lakh ordinary shares of Tk 100 each. Subscription for general public will remain open from October 26 to 30, while the subscription for NRB applicants will remain open up to November 8. There will be 50 shares in each lot and the price of each ordinary share has been fixed at Tk 100.

Hedayet Hossain Chowdhury, founder chairman of Karnaphuli Group of Companies, is the chairman of this company. The paid up capital of the company will stand at Tk 15 crore.

Experts said companies have to pay dividends to the shareholders if they can make profit in the share markets although they don't have to pay anything else to the shareholders if they incur losses. But, the companies have to pay interest if they take loans from banks. In spite of it, the entrepreneurs are not coming to the capital markets which is really unfortunate, they said.