SS Steel shares fly on quarterly earnings growth
FY22 Q1 Financials:
- Revenue increased 12% to Tk143.85cr
- Net profit grew 9% to Tk22.36cr
- EPS was Tk0.73
- NAVPS was Tk24.32
SS Steel Limited's share price soared 9.63% on Tuesday as investors turned to the stock following the disclosure of the quarterly earnings growth by the MS Rod manufacturer.
At the end of the day's trading, their share rose to Tk20.50 on the Dhaka Stock Exchange (DSE).
According to the company's unaudited financial statement for the first quarter of fiscal 2021-2022, its revenue increased 12% to Tk143.85 crore and net profit grew 9% to Tk22.36 crore from a year earlier.
At the end of the July-September quarter, its consolidated earnings per share stood at Tk0.73 and the revalued net asset value per share was at Tk24.32.
The company achieved such growth as the steel market turned around from the tough time wrought by the pandemic. Besides, its subsidiary company has helped it post the growth, it mentioned the reason in the financial statement.
Officials at several brokerage firms said over the last few days there have been discussions among investors on social media platforms that the company would post good returns in its financial reports which have created demand among investors for its shares.
As a result, even though there were buyers for the company's shares during the trading hours on Tuesday, there was a shortage of sellers. So, its share price jumped.
Despite the crisis, 60 lakh of its shares were traded for Tk12.15 crore by the end of the day.
The company got listed on the capital market in 2019 and its paid-up capital is Tk304.29 crore.
In a board meeting on 24 November last year, it declared a 2% cash dividend only for general shareholders and an 8% stock dividend for all in FY21.
As per the audited financial report of FY21, its consolidated earnings per share stood at Tk2.31.
The board has also decided to spend Tk20 crore on the purchase of land and capital machinery for its business expansion.
In 2020, SS Steel acquired 99% shares worth Tk160 crore of Saleh Steel located in Chattogram.
Saleh Steel produces and sells rods and coils under its brand name and its annual production capacity is around 84,000 tonnes, says SS Steel.
In January Last year, SS Steel decided to acquire a 75% share of Southeast Union Ceramics Industry Limited, a coal-based China-Bangladesh joint venture ceramic manufacturing company, for Tk200 crore.
The shareholders of the steel company have also approved the acquisition proposal in an extraordinary general meeting.
The company also signed an agreement with the City Bank to arrange financing of Tk200 crore as a term loan and Tk100 crore as working capital from a consortium of banks and non-banking financial institutions for acquiring the ceramic plant.
