Bourses ask 5 firms to explain timely dividend payment failure
The bourses can change the category of any company that fails to pay declared dividends in due time
Approved dividends & AGM dates of 5 firms
- Pharma Aid – 50% cash, 24 Dec 2020
- Miracle Industries – 1% cash, 26 Dec 2020
- RSRM Steel – 10% cash, 29 Dec 2020
- Western Marine Shipyard – 0.5% cash and 2.5% stock, 29 Dec 2020
- Keya Cosmetics – 1% cash, 19 Jan 2021
The Dhaka Stock Exchange (DSE) and the Chittagong Stock Exchange (CSE) have asked five listed companies to explain their failure to pay declared dividends on time.
The companies are Pharma Aid, RSRM Steel, Western Marine Shipyard, Miracle Industries, and Keya Cosmetics Limited.
As per the listing regulation, every company must pay the declared dividends within 30 days after securing the approval of the dividends in its annual general meeting (AGM).
If any company fails to comply with this rule, the stock exchanges can change the category of the company.
However, the stock exchanges could not change the category of these five companies because last year, the Bangladesh Securities and Exchange Commission (BSEC) had imposed a limit on category change due to the pandemic-driven poor business environment.
As a result, the bourses asked for guidance from the BSEC in this regard. But sources said the regulator had not reply to the stock exchanges yet.
Sources from the DSE said these companies had not submitted their dividend compliance reports in connection with the disbursement of the declared dividends.
The bourses also asked the companies to submit the reports as early as possible. .
Of the companies, only Pharma Aid replied to the DSE's query and said that it had disbursed the declared dividend in due time.
It declared a 50% cash dividend for the last fiscal year, which was approved in the company's AGM that was held on 24 December 2020.
But the four other companies are yet to reply to the stock exchanges. Of them, Miracle Industries declared a 1% cash dividend, which was approved in its AGM held on 26 December 2020.
RSRM Steel declared a 10% cash and Western Marine Shipyard declared 0.5% cash and 2.5% stock dividends for the last fiscal year.
The dividends of both the companies were approved in their AGMs that were held on the same day – 29 December 2020.
Besides, Keya Cosmetics declared a 2% stock dividend for the last fiscal year, but in its AGM held on 19 January this year, investors approved 1% cash dividend instead of the previous declaration.