The Bangladesh Securities and Exchange Commission yesterday approved IDLC Finance's plan to raise Tk500 crore through zero-coupon bonds.
The bonds will mature in four years, with their per unit price set at Tk50 lakh.
IDLC Finance aims to expand its business and strengthen its capital base by issuing bonds to buyers.
The bond units will be sold to banks, insurance firms, financial institutions, and other institutional investors through private placement.
EC Securities Ltd will act as the trustee and IDLC Finance will be the arranger of the bonds.
A zero-coupon bond is a debt security that does not pay interest but trades at a deep discount, rendering a profit at maturity, when the bond is redeemed for its full face value.
IDLC Finance reported a consolidated net profit of Tk161 crore during the first three quarters of 2020, which was 28% higher than the corresponding period of the previous year.
During the period last year, the company's consolidated earnings per share was Tk4.27, while its consolidated net asset value per share was Tk37.95.
IDLC Finance paid a 35% cash dividend to its shareholders for the 2019 financial year.
The company was listed with the Dhaka Stock Exchange in 1992. Its paid-up capital is Tk377 crore.
Out of the total shares of IDLC Finance, sponsors and directors jointly own 56.66%, institutional investors 22.60%, foreign investors 9.64%, and general investors 11.10%.
The closing price of the company's shares was Tk82.20 each, yesterday at the DSE.