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An inspection team of the Dhaka Stock Exchange (DSE) found two factories of Dominage Steel Building Systems shut during a visit this week.
The DSE team visited the company's factory-1 at Aukpara in Ashulia on Tuesday and factory-2 at Palash in Narshingdi on Thursday to inspect their current operational status but found them closed, the DSE said in a statement on Thursday.
Despite the news, its stock surged 3 per cent to close at Tk 13.8 on Thursday.
Dominage Steel, a manufacturer of pre-engineered steel building structures, was listed on the stock exchanges just four years ago.
The company raised Tk 300 million in October 2020 from the capital market under the fixed-prices method, and was supposed to utilise the IPO proceeds within 24 months of receiving the funds.
However, the company failed to complete the utilisation of IPO (initial public offering) funds within that timeframe. It then appealed to the securities regulator for a nine-month extension, aiming to complete the utilisation by December this year.
In May this year, the company's board in a meeting also decided to modify the allocation of IPO proceeds designated for the acquisition of plant & machinery and electrical installations.
Dominage Steel reported losses for the second quarter (October-December 2023) and also for the third quarter (January-March 2024) of FY'24. The company incurred a net loss of Tk 1.03 million in Q2 and Tk 2.05 million in Q3.
Market insiders said many companies entered the stock market showing high hopes but failed to implement their commitments after raising the funds, leaving the investors disappointed.
Company secretary of Dominage Steel Md Jamir Hosen Chowdhury could not be reached for comments.
FINANCIAL PERFORMANCE
The firm could not make expected business owing to lingering macroeconomic challenges amid the Ukraine war. Its net profit plunged 97 per cent year-on-year to Tk 1.02 million in nine months through March this year.
Its annual profit also plunged 92 per cent year-on-year to Tk 4.58 million in FY23. Subsequently, the board declared only 0.50 per cent cash dividend only for the general shareholders for FY23.