The stock market regulator has approved the sale of the primary shares of Index Agro Industries Limited on a 20% discount or at Tk50 to general investors through an Initial Public Offering (IPO).
Bangladesh Securities and Exchange Commission (BSEC) gave the approval on Wednesday in a response to an application moved by the company.
The cut-off price for the shares has been determined at Tk62 each through electronic bidding under the book building method.
The cut-off price is the price point where eligible investors (EI) absorb all the primary shares allocated for them in an IPO under the book building method, where general investors can buy IPO shares at a 10% discount compared to the fixed cut-off price.
Mahbub H Mazumdar, managing director of AFC Capital, which is the issue manager of the company, said Index Agro had applied to the BSEC for a 20% discount for general investors.
The commission approved the proposal on Wednesday in the interest of investors, he added.
The poultry and fish feed manufacturer is going to collect Tk50 crore through the ongoing IPO to construct buildings, execute other civil work alongside acquiring new machinery and equipment, as well as meet the expenditures of the IPO process.
The company completed its bidding on the electronic platform of stock exchanges from 1 to 4 November.
According to the company's audited financial statement as of 30 June 2019, its consolidated earnings per share (EPS) was Tk7.07. Its weighted average EPS for the last five years was Tk5.60.
The company's net asset value (NAV) per share, including revaluation surplus, was Tk45.03, which was Tk44.06, excluding the surplus.
Local investment banks - AFC Capital Limited and EBL Investments Limited - are the joint issue managers for the company's IPO.
Index Agro Industries Limited was incorporated in Bangladesh on 13 September 2000.
The company started its commercial operations on 1 July 2004.
The principal activities of the company are manufacturing and selling poultry feed, fish feed and producing day-old chicks.
Though it has no subsidiary, it has an associate company named X-Ceramics Ltd which is engaged in manufacturing ceramic tiles in Bangladesh.