Robi IPO subscription begins on Tuesday

Highlights

• Robi to collect Tk523.7 crore from investors
• Tk136 crore to come from its employees
• Remaining shares to be offered to the public at face value of Tk10 each
• Money to be spent on expanding network
• In the first half of 2020, it made net profit of Tk77 crore; EPS was Tk0.16
• Paid-up capital was Tk4,700 crore in 2019

Robi Axiata Ltd, the second-largest cell phone operator, is going to open for subscription on Tuesday in the country's largest ever initial public offering (IPO).

Eligible investors, through the electronic subscription system under the fixed price method, will be able to apply to buy the company's shares until 23 November.

During this period, general investors and non-resident Bangladeshis will also be able to apply to buy shares.

The company has the securities regulator's approval to collect Tk523.7 crore from investors through IPO, where new shares will be issued at the face value of Tk10 each.

Robi seeks to expand its network with investors' money.

Following the approval, the Bangladesh Securities and Exchange Commission (BSEC) said the company was accumulating Tk136 crore in fresh capital from its employees under an employee stock purchase plan.

The remaining shares are being offered to the public.

"We hope general investors will participate in the company's IPO subscription and be part of development of the country's largest 4.5G network," said Shahed Alam, chief corporate and regulatory officer of Robi.

"We will use the IPO funds to expand the network that will ensure quality customer service," he added.

Leading local merchant bank IDLC Investments is working as the issue manager to help Robi accomplish the IPO process.

Grameenphone, the telecom market leader, came to the stock market to collect Tk486 crore 11 years ago. The highly profitable company then got Tk60 in premium per share from investors, on top of the face value of Tk10 each, and also attracted a large number of new investors to the stock market.

Now a Tk1,350 crore paid-up capital company, it posted annual revenue of Tk14,365 crore and net profit of Tk3,451 crore in 2019, resulting in annual earnings per share (EPS) of Tk25.56.

Till the end of June this year, Robi secured 4.8 crore subscribers, representing nearly 30% of the market share, while the number of internet subscribers stood at 3.2 crore to represent 67% of the market share. On 15 October, the company announced that it had reached the milestone of five crore subscribers already.

In 2019, its total annual revenue was Tk7,400 crore. That year, Robi made a meagre net profit of less than Tk20 crore while EPS was Tk0.04 only. Its paid-up capital was Tk4,700 crore.

Against flat revenues amid the Covid-19 pandemic in the first half of this year, Robi made a net profit of Tk77 crore and EPS was Tk0.16. The company incurred losses during the same period last year.

Robi commenced its operations in 1997 as Telekom Malaysia International (Bangladesh) under the brand name Aktel. In 2010, it was rebranded as Robi and the company changed its name to Robi Axiata Ltd.

After the merger with Airtel Bangladesh in 2016, the company emerged as the second-largest telecom operator and retained its name. The merger also helped the company see profits later on.

Currently, Robi's 68.69% of controlling shares are held by Malaysian telecom giant Axiata Group Berhad.