CSE

Grameenphone – the country’s leading telecom operator – has witnessed a remarkable surge in its market capitalisation, which increased by Tk3,551 crore between 15 December and 16 February.  

According to data released by the Dhaka Stock Exchange (DSE), the company’s shares rose by over 8% during this period, reaching Tk340.60 per share – its highest level since October last year. 

This upward trend reflects growing confidence among investors in the telecom giant’s financial stability and future prospects.  

Grameenphone remains the largest company by market capitalisation on the DSE, contributing around 13% to the bourse’s total market capitalisation.  

Analysts said the company’s strong market position, consistent dividend payouts, and strategic investments in network expansion and digital services have contributed to the positive sentiment. 

Grameenphone’s focus on innovation and customer-centric solutions has also played a key role in attracting both institutional and retail investors, they added.  

As the telecom landscape continues to evolve, Grameenphone’s performance is being closely watched by market participants, who remain optimistic about its potential for further growth in the coming months, said analysts.  

According to Grameenphone’s shareholding report as of December, Norway’s Telenor Mobile Communications owns 55.80% of the company’s shares, while Grameen Telecom holds a 34.20% stake in the telecom operator. The remaining shares are owned by institutional and general investors.  

Announces highest-ever dividend for 2024

Grameenphone announced it would pay the highest-ever 330% cash dividend, or Tk33 per share, for 2024.  

Having already paid an interim dividend of Tk16 per share, it will pay an additional Tk17 for the past year, according to company statements to shareholders.  

The total cash dividends of Tk4,455 crore for 2024 will be 22.73% higher than the company’s annual net profit. For the first time since 2018, the company is going to pay out more dividends than its annual profit.  

Analysts had anticipated an accelerated dividend payout as multinational companies had paid less in 2022 and 2023 due to a difficult foreign exchange situation in Bangladesh, which eased significantly in 2024.  

In 2024, Grameenphone experienced a slight decline in revenue, which fell to Tk 15,845 crore. However, net profit increased by 10%, reaching Tk 3,630 crore. The company’s earnings per share (EPS) stood at Tk 26.89 at year-end.  

In a press release, its CEO Yasir Azman, acknowledging the business impacts of “rising inflation and the continuously decreasing GDP,” said, “We remain focused on delivering long-term value and stability for our investors.” 

He also promised attractive dividends as part of GP’s strategy to provide shareholders with consistent and reliable returns, even in the face of short-term market fluctuations.  

Grameenphone’s Chief Financial Officer Otto Risbakk attributed the success to its strong balance sheet, which allowed the company to continue its “long-term perspective alongside a lucrative and predictable dividend policy, despite a challenging economic environment.”

Lub-rref (Bangladesh) posted higher profits in the second quarter of the 2024-25 fiscal year but saw its revenue decline year-on-year.

The company reported a net profit of Tk 3.33 crore in the October–December quarter of FY25, marking a significant 87 percent year-on-year increase.

Its earnings per share (EPS) rose to Tk 0.23 in the second quarter, up from Tk 0.12 in the same period last year, according to its financial statements.

Despite the profit surge, Lub-rref’s revenue declined by 4 percent year-on-year to Tk 22.17 crore in the quarter.

For the first half of FY25, the company reported a loss per share of Tk 0.19, compared to an EPS of Tk 0.25 in the same period of the previous fiscal year.

Lub-rref attributed the earnings decline to product shortages stemming from banking cooperation issues, internal disruptions at Social Islami Bank PLC (SIBPLC), and prolonged market gaps that benefited competitors, according to a recent filing on the Dhaka Stock Exchange (DSE) website.

The company also said it had engaged with SIBPLC officials for facility approvals, submitted the necessary documentation, and initiated a market reorganisation strategy.

Its earnings per share (EPS) rose to Tk 0.23 in the second quarter, up from Tk 0.12 in the same period last year

The measures, including product updates, pricing reviews, automation, and rebranding, aim to restore supply, regain market position, and improve long-term profitability, Lub-rref added.

The company’s net operating cash flow per share stood at Tk 1.36 for July–December 2024, slightly lower than Tk 1.40 in the previous year.

Lub-rref (Bangladesh), established in 2001, is headquartered in Chattogram, Bangladesh. Operating under the ‘BNO’ brand, it manufactures and supplies a wide range of lubricants and allied products for the automotive, industrial, and marine industries.

The company also offers services such as onsite transformer oil filtration and used transformer oil reclamation. Shares of Lub-rref (Bangladesh) dropped 0.63 percent to Tk 15.7 in mid-day trading yesterday at the DSE.

https://www.thedailystar.net/business/news/lub-rrefs-q2-profit-jumps-87-3825386

LRBDL

Free float of Walton Hi-Tech Industries was 1.49 per cent even six months back. Then by January this year, the number of publicly tradable shares jumped to more than 30 per cent.

The free float increased so quickly, as six sponsor-directors gifted shares to their family members to comply with the regulatory requirement of at least 10 per cent shares available for trading in the equity market.

In the latest development, SM Rezaul Alam, a sponsor director of Walton, transferred 12.12 million shares to his daughter and spouse on Tuesday, the value of which is Tk 5.45 billion at the current market price.

Nearly 90 million shares in total were transferred to non-director family members in the six months.

Though the shares that had been locked-in become tradable, family members have retained those between them.

“We met the regulatory requirement much before the time (in May this year) within the legal framework,” said company secretary Md Rafiqul Islam.

Free-float refers to the shares of a company that are available to the public for trading in the secondary market. Free float exclude shares held by sponsor-directors and government and other locked-in shares.

Mr Islam said the sponsor directors had made the move to avoid negative impacts in the secondary market. “Now, the family members will gradually release their holdings in the market.”

In 2020, the country’s electronics and technology giant listed by floating less than 1 per cent shares in the secondary market, drawing criticism from market analysts.

There are concerns that fewer free float engenders abnormal price rise of stocks when the demand is high.

In the four months after listing, the stock became the second largest firm in terms of market value. Currently, Walton is the fifth largest firm, with a market capitalisation of Tk 148.58 billion.

Amid concerns over inflated stock prices, the Bangladesh Securities and Exchange Commission (BSEC) amended its Public Issue Rules in August 2021, making it mandatory for companies to offload shares worth at least 10 percent of their paid up capital.

In September 2021, the BSEC asked Walton to meet the requirement within a year by offloading stakes of sponsor-directors.

Walton at the time struggled to do so as floor price drove away buyers from the market.

In May 2022, the market regulator extended the time by three years for compliance with the regulatory obligation.

Sponsor-directors explored ways to increase free float but the sale of such a huge number of shares could have an adverse outcome. A sudden supply of shares might have pushed down the share price.

However, market analysts are critical about the way the free float has been increased.

A leading stockbroker, requesting not to be named, said, “Walton technically increased the free float to comply with the regulatory requirement but there is a possibility of share price manipulation in the future as a majority of the shares remained within the family.”

Sponsor-directors of Walton wanted to secure ownership and to make sure the share price does not fall in the equity market, he added.

Moreover, the company will enjoy an annual tax deduction by two and a half per cent for having more than 10 per cent shares in the secondary market. Sponsors themselves also availed of tax benefits by transferring shares, instead of selling in the market.

FINANCIAL PERFORMANCE

Meanwhile, Walton’s profit dropped more than 10 per cent year-on-year to Tk 3.04 billion in the first half of FY25, due to higher production costs and increased finance expenses.

It had a 73 per cent growth in profit in FY24, compared to the year before. Based on the profit growth, the company paid a 350 per cent cash dividend for FY24, the highest since listing in 2020.

STOCK PERFORMANCE

The stock of Walton had been stuck at the floor price of Tk 1047.7 each share for more than 18 months until January last year. After the removal of the floor, the stock plunged to Tk 428 per share within the six months to June last year.

The stock traded between Tk 428.9 per share and Tk 817.6 per share in the last one year. It dropped 0.41 per cent to Tk 488.5 per share on Wednesday on the Dhaka Stock Exchange. https://thefinancialexpress.com.bd/stock/bangladesh/green-deltas-profit-plunge-on-decline-in-premium-income