Loss-making Aramit Cement’s stock soars 34% in 7 days

Stock price of the poorly-performing Aramit Cement Ltd has jumped by 34% in the past seven working days and stood at Tk29.5 on Sunday. 

On 16 August, the listed cement-maker's shares traded at Tk22 apiece. 

In response to Dhaka bourse's query about this unusual increase in share price, Aramit Cement said that there was no undisclosed price-sensitive information that might have influenced the stock price. 

During the July to March period of the fiscal 2022-23, the company earned a total revenue of Tk10.35 crore — 83% lower than what it was in the same period previous year. 

In the July-March period of FY23, the company incurred a loss of Tk39.5 crore, which was Tk25.8 crore a year ago.

At the end of March 2023, its loss per share stood at Tk11.66 and net asset value per share at Tk0.97. 

The company has been continuing to lend money to its affiliate firms without collecting due payments for years, thus violating a regulatory order and depriving investors of expected returns.

Aramit Cement is owed a huge amount of money by its affiliate firms. But instead of collecting the dues, Aramit has continued to provide further loans to the companies.

Although the company at times charges interest against the loans, there are instances of interest being waived as well.

According to the company's annual report for FY22, Aramit Cement had provided loans of around Tk114 crore to its affiliate companies in that fiscal. 

Aramit Cement's Company Secretary Syed Kamruzzaman did not respond to a call seeking comments in this regard.

Aramit Cement Limited is a concern of the Aramit Group. The company was incorporated in August 1995 and was listed on the stock exchanges in 1998.

As of 31 July 2023, sponsors and directors hold 45.92%, institutions 10.41%, and general investors 43.67% of the company's shares.