Sikder Insurance gets BSEC's nod to raise Tk16cr through IPO

Sikder Insurance Company Limited, a concern of the Sikder group, will raise Tk16 crore from the stock market through an initial public offering (IPO) to expand its business.

The company will issue 1.6 crore shares, the Bangladesh Securities and Exchange Commission (BSEC) said in a statement on Thursday, after giving the green light to a proposal in this regard.

Each share of the company will have a face value of Tk10.

The company will invest the IPO funds in the capital market, fixed deposits, and purchasing floor space and to meet IPO expenses.

Sonar Bangla Capital Management Limited is working as the issue manager of the company for its IPO process. G Kibria & Co Chartered Accountants is acting as the auditor of the company.

The current paid-up capital of the company is Tk24 crore and the authorised capital is Tk50 crore.

According to the audited financial report for the year ending on 31 December 2022, the earnings per share (EPS) of the company stood at Tk1.22 while its net asset value per share was Tk28.73, excluding revaluation.

End of December 2022, the net premium of the company stood at Tk20.24 crore, which was Tk11.87 crore in 2021.

During the year, its net profit after tax was at Tk2.92 crore, which was Tk2.86 crore a year ago. Its retained earnings stood at Tk8.45 crore.

The company's total assets stood at Tk181.29 crore and the total reserve and surplus was Tk44.96 crore end of December 2022.

It also paid claims of Tk27 lakh, which was Tk15 lakh in the same period of the previous year.

The company started operation in July 2013. The principal activity of the company continues to be carrying on non-life insurance businesses.

It underwrites major insurance businesses such as fire accidental damage on property insurance, marine cargo insurance, marine hull, liability insurance, aviation insurance, motor insurance, engineering insurance & miscellaneous insurance.

Sikder Insurance will not be able to declare any dividend, approval, or distribution before listing on the capital market.

Currently, there are 81 insurance companies – 36 life and 45 non-life – in the insurance sector of Bangladesh. Of them, 57 are listed on the stock exchanges.

Experts have been saying for a long time that Bangladesh is one of the most untapped insurance markets in terms of penetration rate. Awareness and a strong culture of insurance service behind economic activities can help the industry thrive.