CVO Petrochemical Refinery reported an impressive 115% revenue growth in the first half of fiscal year 2024-25, reaching Tk65.53 crore — surpassing the total revenue of the previous fiscal year within just six months.
This remarkable performance is attributed to the adoption of advanced technology, which has significantly enhanced local petroleum production, reducing the industry’s reliance on imports, according to a company official.
During the July-December period, the company posted a net profit of Tk5.22 crore, marking a 7% increase compared to the same period last year.
In FY24, the company — also listed on the stock exchange — reported total revenue of Tk61.29 crore and a net profit of Tk6.49 crore.
Following the announcement of robust growth in revenue and profit in the first half, published today on the Dhaka bourse, CVO Petrochemical’s share price rose by 1.02% to Tk119.10, hitting its highest level since October last year.
CVO diversified plant
CVO Petrochemical, originally a vegetable oil refiner struggling to compete with imports, successfully reinvented itself as a petrochemical refinery. However, the company faced several production challenges primarily due to product quality issues, which it attributed to the inadequate standards of local raw materials.
Due to this, the company halted production for 14 months till September 2022, and that is why it did not earn any revenue and incurred loss.
To support the growth of local petroleum refining, the government decided to supply imported condensate to domestic refineries, allowing CVO Petrochemical to regain momentum in its operations.
In September 2022, CVO Petrochemical became the first company in the country to sign a contract with the Bangladesh Petroleum Corporation (BPC). Under the agreement, it sources naphtha from BPC-owned Eastern Refinery to produce high-quality solvents at its plant. The company also secured a three-year agreement to sell its products to the BPC at a fixed margin.
The company stated that there is a significant untapped market in Bangladesh for hydrocarbon solvents, which currently relies heavily on imported materials. These solvents are primarily used in industries such as paint, washing plants, grease, lubricants, sanitisers, and insecticides.
To enhance efficiency, CVO Petrochemical upgraded its plant with a unique design capable of processing two different raw materials simultaneously. This innovation was made possible by introducing advanced American technology and equipment, enabling the production of high-quality products, according to the company’s financial report.
With the upgraded plant in operation, CVO Petrochemical received permission to import 20,000 tonnes of diesel-rich condensate annually to produce diesel. The company imported its first consignment of this raw material and began production in March last year. The financial report also noted that a second consignment is expected to arrive soon under its own management.
With an annual production capacity of 30,000 tonnes for naphtha-based products and 25,000 tonnes for diesel-rich condensate, CVO Petrochemical is well-positioned to meet rising industrial demand while driving substantial revenue growth, said the company in its report.
The company stated in its FY24 annual report that the upgraded plant is equipped to produce both products simultaneously, enhancing production capacity utilization and driving increased earnings. https://www.tbsnews.net
