BSEC has allowed Nialco Alloys Limited to raise Tk7.5 crore with a qualified investor offer (QIO) by issuing 0.75 crore shares to eligible investors on the small-cap platforms of the stock exchanges.
This is the first company to be approved for trading on the small capital companies' board in two years of its journey.
The Bangladesh Securities and Exchange Commission (BSEC) regulatory body gave the approval at a meeting on Thursday, read a press release.
Each share of the company, which mainly manufactures high grade bronze and brass ingots, will have a face value of Tk10.
The company wants to raise funds through the fixed-price method to spend Tk4.86 crore on plant and machinery, and Tk2.56 crore on land development.
MTB Capital, a sister concern of Mutual Trust Bank Ltd, is the issue manager of the company.
According to a financial report, in the July-September quarter of 2020, company revenue was Tk20.56 crore, and net profit was Tk1.39 crore.
During this period, the earnings per share of the company was Tk0.91 and net asset value per share stood at Tk12.43 without revaluation reserve.
A source at Nialco said it is a 100% export-oriented company and the demand for copper products is increasing globally.
The company has a good supply of raw materials because government policy favors this sector.
Most of the products are exported to different countries, especially Japan and Korea, as raw materials. The company has no major competitor in the country.
The commission earlier rejected the company's application for not following QIO rules properly.
The small capital companies' board started on 30 April 2019 but since then they remained almost unused as no small-cap firms received approval for being listed with the Dhaka and Chittagong stock exchanges, noted the commission.
Now the commission wants to make the small-cap board active by allowing some companies to be on the board within this financial year.
In November 2018, the BSEC gave final approval to the Bangladesh Securities and Exchange Commission (Qualified Investor Offer by Small Capital Companies) Rules 2018, with some changes and amendments.