The Bangladesh Securities and Exchange Commission (BSEC) has taken a tough stance against Olympic Accessories, a listed firm on the capital market, for failing to maintain the mandatory 30% joint holding by its owners.

According to letter of the commission, the regulator has decided to enforce its 2019 directive on mandatory shareholding, as Olympic Accessories’ owners currently hold only 25.81%

The directive bars the owners from selling, transferring, or keeping shares as collateral, as well as from raising funds.

In case of non-compliance by listed firms, the regulator also decided to transfer them to a separate trading platform, and any company, which holds 2% shares of the company may be nominated as director in the board, the disclosure read.

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In addition to the imposed conditions in 2019, the regulator warned that if Olympic Accessories’ sponsor-directors’ joint holding falls below 25.81%, the directors will be held responsible and face punishment.

The commission also directed sponsor-directors to meet the 30% requirement within three months.

According to the Dhaka Stock Exchange (DSE) data, the deemed exporter has been incurring losses since the 2019-20 fiscal year up to the 2023-24 fiscal year. During these five fiscal years, FY23 saw the highest losses, amounting to Tk39.44 crore, with a loss per share of Tk2.33.

Attempts to contact Company Secretary Md Shahriar failed as his mobile phone remained switched off.

Olympic Accessories was founded in 2003 in Bangladesh as a private limited company. Its core activities include manufacturing, processing, printing, cutting, sealing, and assembling a wide range of products, including hangers, cartons, elastics, twill tapes, backboards, tissue paper, gum tape, interlinings, labels, poly bags, threads, stickers, photo inlays, barcodes, hangtags, and related items.

The company mainly supplies these items to export-oriented garment factories through Back-to-Back L/Cs and to all 100% export-oriented garments industries, operating as a deemed exporter.

Olympic Accessories raised Tk20 crore from the capital market by issuing shares at a face value of Tk10 each.

Its shares price closed at Tk7.10 each at the DSE today (7 September).

In addition to incurring losses for five consecutive years, the company has continued to operate at a loss during the first nine months of the 2024-25 fiscal year.

During the July to March quarter of FY25, it incurred a loss of Tk8.47 crore with per share loss of Tk0.50.

Lastly, in FY21, it had paid a 1% cash dividend to its shareholders. As it failed to pay dividend to its shareholders, the bourses has downgraded the company to the Z category.

https://www.tbsnews.net/economy/stocks/30-mandatory-holding-bsec-gets-tough-olympic-accessories-1230896

OAL

Confidence Cement PLC has announced plans to sell its entire stake in its Dhaka-based subsidiary to Confidence Power Holdings Ltd, citing a combination of financial obligations, strategic restructuring, and market headwinds in the cement sector.

The proposed transaction involves 14.09 crore ordinary shares priced at Tk 10 each, totaling Tk 140.97 crore, according to a disclosure on the Dhaka Stock Exchange (DSE) website yesterday.

Approved by the board on September 4, the deal is subject to shareholder approval at an upcoming general meeting.

Speaking to The Daily Star on the matter, Confidence Cement Company Secretary Delwar Hossain said the decision to divest its Dhaka unit is part of a “broader strategic shift,” as the company seeks liquidity to meet operational and financial obligations in a tightening market.

He also dismissed speculation in the industry that the transaction was a form of internal financial maneuvering.

“Not exactly. When a group has multiple units, each must maintain its own legal identity. That’s all this is,” he said.

“The process is fully transparent and aligns with all applicable guidelines,” he added.

Confidence Cement’s Dhaka unit, which has a production capacity of 6,000 tonnes per day, has yet to reach full commercial operation.

Citing macroeconomic factors and a prolonged slowdown in infrastructure projects, Hossain said, “The industry is going through a tough phase. There’s a notable slowdown in government infrastructure projects, which has significantly impacted overall demand.”

“To operate the production unit efficiently, we need funding. Since we currently lack adequate liquidity, we’re handing it over to a stronger entity that can manage it better,” he explained.

He confirmed that the unit’s name will remain unchanged: Confidence Cement Limited.

The move underscores the increasing financial strain faced by cement manufacturers, many of whom are being forced to rethink their business models amid a myriad of challenges, including declining demand, squeezed profit margins, falling investments, higher input costs, reduced private sector activity, and weak infrastructure spending by the government.

Confidence Cement’s stock closed at Tk 63.30 on the DSE yesterday, rising 1.44 percent from the previous day.

The company reported a profit of Tk 24.84 crore in the January-March quarter of this year, although earnings per share fell to Tk 2.88, down from Tk 3.00 in the same period last year.

DSE data show that, as of August 31, sponsors and directors held 30.34 percent of the company’s shares, while institutional investors owned 37.63 percent and the general public 32.03 percent

https://www.thedailystar.net/business/news/confidence-cement-sell-subsidiary-sister-company-3980146