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Techno Drugs Ltd will make its share trading debut on the Dhaka Stock Exchange (DSE) and Chittagong Stock Exchange (CSE) on July 14 (Sunday) under the ‘N’ category.
The drug maker, which received regulatory approval from the Bangladesh Securities and Exchange Commission (BSEC) on March 7, raised Tk 1 billion from the primary market under the book-building method for business expansion and loan repayment.
With the IPO proceeds, the drug maker will purchase new machinery at an expense of Tk 270 million, expand its existing factory in Narsingdi at Tk 250 million, repay Tk 300 million against bank loans and build a new production unit in Gazipur at Tk 150 million and rest of the amount set aside for IPO expenses.
The cut-off price of the drug maker’s shares was fixed at Tk 34 through electronic bidding by institutional investors between April 21 and April 24 this year --- a requirement for going public under the book-building method.
The general investors, including non-resident Bangladeshis, however, got shares at a 30 per cent discount on the cut-off price, meaning at Tk 24 each.
The IPO subscription of Techno Drugs was held between June 10 and 13. Its IPO was oversubscribed by 24.64 times as it received Tk 24.87 billion as against IPO shares worth Tk 1 billion, according to DSE.
Each general investor got 11 initial public offering (IPO) shares of Techno Drugs, while the non-resident Bangladeshis received 20 shares against an application of Tk 10,000, under the pro-rata basis, which allows every applicant to get shares.
Meanwhile, Techno Drugs’ sales dropped 45 per cent year-on-year to Tk 2.73 billion in FY23 while net profit plunged 59 per cent to Tk 195.5 million.
Accordingly, the earnings per share (EPS) stood at Tk 2.08 for FY23, down from Tk 5.10 a year ago. Its net asset value (NAV) per share with a revaluation surplus was Tk 27.78 while the NAV stands at Tk 22.57 per share without the surplus as of June 2023.
Imperial Capital and EBL Investments are acting as issue managers of the company’s IPO process.
Established in 2009, the drug maker produces human and veterinary medicines and sells them both at home and abroad. Techno Drugs also claims that it pioneered the production of oncology medicines in Bangladesh.