Taka devaluation erodes National Polymer profit by 94%
National Polymer Industries' profit dropped by 94% in the first half of FY23 due to a significant foreign exchange loss caused by the devaluation of the taka against the dollar.
The company, which manufactures PVC pipes, PVC doors, and bottle-grade PVC compounds, and sells products in both local and international markets, reported an earnings per share of Tk0.08 in the July-December period of FY23, which was Tk1.27 a year ago.
On condition of anonymity, an official of the company told TBS, "Manufacturers of PVC or plastic goods have to import 100% of the raw materials. Due to the high value of the dollar, we had to buy raw materials at higher prices, but could not increase the product prices accordingly. Consequently, our profit has decreased."
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The company had a linear growth in sales and profits in the last decade and witnessed a profit growth even during the Covid-19 pandemic. To maintain this continuity, the company started manufacturing water tanks, furniture, doors and other household goods along with plastic or PVC pipes.
The company issued a bond worth Tk300 crore last year to ramp up production of a diverse range of products. Earlier, it issued rights shares to raise capital from the stock market.
Despite a consistent growth over the last decade, the company had only paid stock dividends to shareholders from 2011 to 2019. It moved away from stock dividends and started giving cash dividends in 2020, when the stock market regulator became stricter in this regard.
In the last fiscal year, it paid a 10.50% cash dividend to its shareholders.
The company was incorporated in 1987 and got listed on the Dhaka Stock Exchange (DSE) in 1993.
Its share price has been stuck at the floor price – Tk51 each – since November 2022 at the DSE.
