The Bangladesh Securities and Exchange Commission (BSEC) has formed a four-member inquiry committee to look into the financial statements of Ratanpur Steel Re-Rolling Mills (RSRM) for the last five years – from 2017 to 2021.
The committee – set up this week – will examine corporate governance, the role of the statutory auditor, import and export documents, money laundering issues, and use of initial public offering (IPO) proceeds of the company, according to BSEC officials.
Headed by BSEC Additional Director Mohammad Al Masum Mirdha, the team has also been mandated to find out any anomalies in the debt capital, related party transactions, and overall activities and business performance of the steelmaker, they added.
Joint Director Md Saiful Islam, Dhaka Stock Exchange's (DSE) Senior Manager Md Masud Khan, and Chittagong Stock Exchange's (CSE) Deputy Manager Mohammad Nazmul Hossain are the other members of the committee.
Incorporated in 1986, Ratanpur Steel Re-Rolling Mills Limited raised Tk100 crore from the stock market in 2014. The firm issued 2.5 crore ordinary shares at a face value of Tk10 with a Tk40 premium each.
The principal activities of the company are to manufacture and sell MS Bar of various grades from MS Billet.
In fiscal 2012-13, the company posted revenue of Tk525.38 crore and its net profit was Tk16.67 crore.
But eight years later, in fiscal 2020-21 it incurred a loss of Tk38 crore, and its revenue stood at Tk145 crore.
Last year, the company kept its steel production closed for around eight months due to electricity problems.
RSRM Group's excessive bank liability amounting to around Tk2,200 crore under its four companies and tussle with lenders regarding paying installments were the main reason behind the sorry state.
Founded in 1984, Ratanpur Group has established itself as one of the leading steel companies based in Chattogram. The industrial group once had an annual turnover of around Tk700 crore.
One of its non-listed companies, Ratanpur Ship Recycling Industries enabled the group to source scraps from its own shipbreaking yard, while Modern Steel Mills was founded to make billets out of scrap metals to cater to the construction rod plant owned by the listed company.
Modern Steel Mills failed to get listed on the stock exchange due to its high debt burden, while the BSEC also rejected the already listed company's right share issuance plan.
The last trading share price at the DSE was Tk20.9 per share on Thursday.
As of 28 February, sponsors and directors jointly held 29.93%, institutions 33.73%, and general investors 36.34% of the company shares.