Padma Oil, Energypac ink deal to sell LPG
As per the agreement, Padma Oil will receive royalties of Tk0.50 per liter sale of LPG
State-owned petroleum distributor Padma Oil Company Ltd recently signed an agreement with Energypac Power Generation Ltd to sell the latter's liquefied petroleum gas (LPG).
Padma Oil will sell the LPG by constructing LPG refueling stations and gas conversion workshops parallel to the sale of petroleum oil through its registered filling stations.
As per the agreement, Padma Oil will receive royalties of Tk0.50 per liter sale of LPG.
Humayun Rashid, managing director of Energypac Power Generation told The Business Standard, "We have initially selected 100 filling stations of Padma Oil across the country to sell our LPG under the brand name G gas."
"We also plan to establish our own refueling stations, but we need more time for that," he added.
Energypac started the LPG business under the G gas brand name in 2017. The company was approved by the explosives department this year to increase LPG storage capacity to 5,405 tonnes. At present, Energypac has an LPG storage satellite plant with a capacity of 1,200 tonnes.
The Bangladesh Securities and Exchange Commission (BSEC) has allowed Energypac Power Generation to determine the cut-off price of its shares through eligible investors' bidding–a requirement for going public under the book-building method. The company got BSEC's approval for its IPO on August 6 this year.
Energypac Power will raise Tk150 crore through its initial public offering (IPO).
Lanka Bangla Investment Limited is the issue manager for the company's IPO.
Energypac will use the IPO proceeds to expand business, repay bank loans and cater expenditures for the IPO process.
According to the audited financial statement as of June 30, 2019, the company's consolidated earnings per share was Tk3.13. Its net asset value per share was Tk45.15 including re-evaluated reserves and Tk30.20 excluding re-evaluated reserves.
Padma Oil was listed on the Dhaka Stock Exchange (DSE) in 1976.
In the first three quarters of the 2019-20 financial year, Padma Oil posted net profit of Tk200 crore and its earnings per share was Tk20.63.
The closing price of the company's shares was Tk216.30 each at the DSE on Wednesday.
