National Polymer Industries Ltd, a company listed in the share market, will issue right shares at TK15 including a premium of Tk5 per share.
The company's shareholders approved the matter at an extraordinary general meeting (EGM) held on Tuesday.
Earlier, the company had recommended issuing right shares at 1R:1, which means one right share issued against one ordinary share. It had proposed Tk20 as the price of each right share including a premium of Tk10 per share. The company wanted to raise Tk60 crore as paid-up capital by issuing these shares.
But the shareholders approved Tk15 as the right share's issue value, which means that National Polymer will raise Tk45 crore instead of the anticipated Tk60 crore, said company officials.
At the meeting the shareholders said, a Tk10 premium is too high in the share market because it is going through a financial crisis. The shareholders therefore decided to use the company's reserve fund to meet the cost of expansion of its factory.
There is Tk63 crore in National Polymer's reserve fund.
Md Omar Faruk, the chief financial officer of National Polymer, told The Business Standard that the shareholders can subscribe to right shares at Tk15 issue value after the Bangladesh Securities and Exchange Commission approves it.
AAA Finance and Investment Ltd will act as its issue manager.
National Polymer's annual general meeting (AGM) was also held on the same day as the EGM. The AGM approved the company's stock dividend of 22 percent.
At the AGM, National Polymer's Managing Director Riad Mahmud said the demand for plastic products is increasing both at home and abroad. So an investment will be made to increase the company's production.
At present, National Polymer's total production capacity is 34,362 tonnes.
During the last six fiscal years from 2013-14 to 2018-19, the revenue of the company increased 103 percent to Tk300 crore. During the same period, the company's net profit after paying tax has increased by 225 percent to Tk13 crore.
National Polymer exports plastic products to India, Nepal, Bhutan, and to Saudi Arabia.
The company first entered the overseas market in 2014 by exporting Tk20 lakh worth of products that year. In the 2018-19 fiscal year it exported Tk6 crore worth of plastic products, an increase of 2,900 percent over five years.
National Polymer's Chief Financial Officer Omar Faruk said the demand for PVC products is increasing in the international market. Therefore, they are exploring markets for their products in countries such as Thailand, Myanmar and Sri Lanka.
National Polymer's existing paid-up capital is around Tk30 crore. The state-run Investment Corporation of Bangladesh holds 23.70 percent shares of the company.
On Tuesday, the closing price of National Polymer's share was Tk75.20 at the Dhaka Stock Exchange. Last year, the highest price of the company's share was Tk133.90 while the lowest was Tk67.30.