Ashuganj Power issues another 55.72cr shares to BPDB

Ashuganj Power Station Company, one of the largest state-owned electricity producers in the country, recently issued another 55.72 crore ordinary shares to the Bangladesh Power Development Board (BPDB).

The company had earlier received equity of Tk557.26 crore from BPDB as a share money deposit to implement a power project. As per the vendor's agreement, the company issued these shares against the equity.

At present, BPDB, which is responsible for operating much of the country's power-generation facilities, owns 99.99 percent of the total shares of Ashuganj Power Station Company.

An official of the company, seeking anonymity, said it is preparing to be listed on the stock market. As part of this, the funds that were taken from the government as share money deposits are being converted into shares.

The government to offload shares

At a meeting chaired by Finance Minister AHM Mustafa Kamal in February this year, the government decided to offload its shares in five energy and power companies on the stock exchanges through initial public offerings (IPOs).

The companies are: the North West Power Generation Company, the Electricity Generation Company of Bangladesh, Ashuganj Power Station Company, BR Powergen Ltd, and the Gas Transmission Company.

Ashuganj Power has taken several steps in this regard.

Mohammad Abul Mansur, company secretary of Ashuganj Power, told The Business Standard, "We are working to offload the shares on the stock market. Now we are preparing our company's asset valuation."

Issuing bonds through IPO

Ashuganj Power, last year, issued bonds worth Tk500 crore, through private placements among state-owned banks and financial institutions, to finance its 400 MW power plant which is now under construction.

Acting upon the government's advice to increase tradable bonds on stock exchanges, bonds worth Tk100 crore were sold to general investors through an initial public offering (IPO), with the face value of Tk5,000 per unit.

The bonds, with a tenure of seven years, offer an interest rate ranging from 8.5 percent to 10.5 percent.

The bonds have traded on the secondary market of the Dhaka Stock Exchange. On Monday, the closing price of the bonds was Tk5,015 per unit.

Financial performance

The revenue of the company increased by four percent to Tk1,809.77 crore in the first three quarters of the last financial year. However, its net profit decreased by five percent to Tk312.91 crore in that period.

In the 2018-19 financial year, the company paid six percent cash dividends to its shareholders, which was five percent in the previous year.

Thus, the company has maintained its track record of paying dividends, uninterrupted, for the last eight years.

Ashuganj Power is one of the largest power generation companies in Bangladesh; having installed capacity for about 17 percent of the total electricity generation capacity in the public sector of the country. At present, the total capacity of its eight units is 1,690 MW.

The company generates about 8.76 percent of the total electricity generation of the country.

Currently, the company has four upcoming projects with the power generation capacity of 4,440 MW.