DSE finds Dulamia Cotton's operations closed

The Dhaka Stock Exchange (DSE) visited the factory premises of Dulamia Cotton Spinning Mills Ltd on Sunday, only to find it fully closed. 

In a disclosure on its website, the bourse informed that a DSE team went to the company's factory premises for an inspection of its current operational status. 

But the team could not enter the factory, let alone carry out the inspection, because the factory was sealed.

Dulamia Cotton was established in 1987 and was listed on the DSE in 1989. Its factory is located in Feni. 

The company started its journey by installing Romanian spinning machines. 

Spinning machines have become more modern in the last two decades, but as a loan defaulter of BDBL Bank, Dulamia Cotton could not upgrade its machines due to the financial crisis.

The cost of yarn produced with Romanian machines is much higher than that of the one made with modern machines. So, the company has been incurring losses since 2000.

In 2013, BDBL Bank filed a case against the company to recover the default loan of Tk7 crore by selling its assets. The company then filed a petition with the High Court to have its name removed from the CIB report as a loan defaulter.

The High Court in 2018 ordered the bank to treat Dulamia as a company of ill financial health. It ordered the company to pay 30% of the default loan while the bank was directed to waive the remaining amount and take necessary steps to remove the company's name from the CIB report of the Bangladesh Bank.

As per the High Court order, the company agreed to pay the interest. After that, the company assigned a firm to verify what needed to be updated.

But in 2019, BDBL Bank appealed against the High Court order and obtained a stay order on the High Court verdict. The case is currently pending.

A senior officer of the company told The Business Standard, "We are not able to get out of this problem due to the non-cooperation of the bank. Both parties filed cases against each other which are still pending."