30% mandatory holding: BSEC gets tough on Olympic Accessories
Its shares price closed at Tk7.10 each at the DSE today (7 September).
The Bangladesh Securities and Exchange Commission (BSEC) has taken a tough stance against Olympic Accessories, a listed firm on the capital market, for failing to maintain the mandatory 30% joint holding by its owners.
According to letter of the commission, the regulator has decided to enforce its 2019 directive on mandatory shareholding, as Olympic Accessories' owners currently hold only 25.81%
The directive bars the owners from selling, transferring, or keeping shares as collateral, as well as from raising funds.
In case of non-compliance by listed firms, the regulator also decided to transfer them to a separate trading platform, and any company, which holds 2% shares of the company may be nominated as director in the board, the disclosure read.
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In addition to the imposed conditions in 2019, the regulator warned that if Olympic Accessories' sponsor-directors' joint holding falls below 25.81%, the directors will be held responsible and face punishment.
The commission also directed sponsor-directors to meet the 30% requirement within three months.
According to the Dhaka Stock Exchange (DSE) data, the deemed exporter has been incurring losses since the 2019-20 fiscal year up to the 2023-24 fiscal year. During these five fiscal years, FY23 saw the highest losses, amounting to Tk39.44 crore, with a loss per share of Tk2.33.
Attempts to contact Company Secretary Md Shahriar failed as his mobile phone remained switched off.
Olympic Accessories was founded in 2003 in Bangladesh as a private limited company. Its core activities include manufacturing, processing, printing, cutting, sealing, and assembling a wide range of products, including hangers, cartons, elastics, twill tapes, backboards, tissue paper, gum tape, interlinings, labels, poly bags, threads, stickers, photo inlays, barcodes, hangtags, and related items.
The company mainly supplies these items to export-oriented garment factories through Back-to-Back L/Cs and to all 100% export-oriented garments industries, operating as a deemed exporter.
Olympic Accessories raised Tk20 crore from the capital market by issuing shares at a face value of Tk10 each.
Its shares price closed at Tk7.10 each at the DSE today (7 September).
In addition to incurring losses for five consecutive years, the company has continued to operate at a loss during the first nine months of the 2024-25 fiscal year.
During the July to March quarter of FY25, it incurred a loss of Tk8.47 crore with per share loss of Tk0.50.
Lastly, in FY21, it had paid a 1% cash dividend to its shareholders. As it failed to pay dividend to its shareholders, the bourses has downgraded the company to the Z category.
