Dacca Dyeing makes robust comeback after years of trouble

Dacca Dyeing and Manufacturing Company – one of the country's oldest home textile makers – has made a strong comeback from years of losses thanks to the securities regulator's supervision and owners' efforts.

Investors once again expect a good return as the company's share price has risen six and a half times in the last year and is being traded at Tk23 on the Dhaka Stock Exchange (DSE).

The shares had earlier plummeted to Tk3 each as the textile manufacturer suffered losses for consecutive years from the 2015-16 to 2018-19 fiscal years.

During the four years, it incurred a loss of Tk136 crore mainly because its factory went out of production after the disconnection of its gas lines and the power crisis.

In addition, its loans with Sonali Bank and Agrani Bank defaulted which became a big obstacle towards its exports.

From this situation, it has turned around due to efforts by the Bangladesh Securities and Exchange Commission (BSEC) and the directors of the company.

Officials at the textile manufacturer declined to comment on this issue but several BSEC officials said the present commission, immediately after taking charge, held a meeting with the directors of the company.

In the meeting, the company was advised to appeal to the High Court to get the gas connections restored. Besides, it was asked to organise the annual general meetings, which have been halted since 2016.

A director of the company, speaking on condition of anonymity, said the gas connection was restored following a High Court order.

Besides, defaulted loans have also been regularised through rescheduling. Moreover, working capital has been taken from the government's stimulus package. At present, the company's factory is operating in full swing.

Following the combined efforts, the company could report a 362% year-on-year growth in net profit to Tk5.22 crore in fiscal 2020-21.

Its net profit grew 138% to Tk2.70 crore in the first quarter of this fiscal year.

The company declared a 2% cash dividend for its shareholders for FY21.

Launched in 1963, the company is currently operating under the QC Group. Its board of directors includes Gias Uddin Quader Chowdhury, Samir Quader Chowdhury, Samiha Quader Chowdhury and Sajia Quader Chowdhury.

All of them are relatives of former Bangladesh Nationalist Party leader Salahuddin Quader Chowdhury who has been executed for crimes against humanity committed during the 1971 Liberation War.

They took ownership of the company in 1996-97. Earlier, it was under a state-owned bank.

It also has a representative of the Bangladesh Development Bank on its board. The bank owns 12.44% shares in the company.

The company currently exports home textiles such as bedsheets, towels, as well as supplies to the local market.

In 2009, the company got listed on the stock market, by issuing 1.7 crores of its shares. Then in 2013, it applied for issuing the right shares to build a spinning factory.

But the company could not move forward with the plan in the absence of approval from the securities commission and lack of bank loans.