National Polymer gets regulator nod to raise Tk54.73cr
The fund will be used to enhance the company’s production capacity and repay its high-cost bank loans
The securities regulator has approved the right share offer of the National Polymer Industries Limited to raise Tk54.73 crore.
The company produces and sells PVC (plastic) pipe, door and other household items across the country, securing second position in the field of PVC door.
Bangladesh Securities and Exchange Commission (BSEC) gave the listed firm its nod at a meeting held on Tuesday.
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According to the commission, the company will issue right share at 1R:1, which means one right share issued against one ordinary share.
The PVC maker will issue the shares each at Tk15 including a premium of Tk5 per share.
The fund will be used to enhance the company's production capacity and repay its high-cost bank loan.
AAA Finance and Investment Ltd will act as its issue manager.
According to an official of the company, the demand for plastic products is increasing both at home and abroad. So an investment will be made to increase production.
At present, National Polymer's total production capacity is 34,362 tonnes.
The revenue of the company rose 14% to Tk343 crore in FY20.
During the same period, the company's net profit after paying tax has increased by 18% to Tk15 crore.
The company recommended a 15% cash dividend to its shareholders for the last fiscal year.
National Polymer first entered the overseas market in 2014 by exporting products worth Tk20 lakh.
In the last fiscal, it exported plastic products worth Tk6 crore.
Earlier in July this year, the company got a long-term loan of Tk190 crore from its non-listed sister concern - National Fittings and Accessories Ltd.
According to the company, the intercompany loan shall be used to offset several existing high-cost loans from Non-Bank Financial Institutions (NBFIs) and commercial banks.
The move aims to ensure smooth operation of the PVC maker even during the adverse economic condition created by the Covid-19 pandemic, it added.
Beginning operations in 1987, National Polymer was listed on the stock exchange in 1993. Its paid-up capital is Tk36.5 crore.
Sponsors and directors currently hold over 43.11% of the company's shares while institutional investors 10.19% and general investors 46.70%.
The closing price of each share of the company was Tk65.10 on Tuesday at the Dhaka Stock Exchange.
