BSEC looks into Mir Akhter’s IPO, bond proceeds utilisation
A three-member panel, set up on 27 November, will inspect the company and submit its report to the commission within 60 working days, according to BSEC officials
The securities regulator has formed a committee to review the utilisation of Tk332 crore raised through an initial public offering (IPO) and a zero-coupon bond by Mir Akhter Hossain Limited – a construction giant.
The three-member panel, set up on 27 November, will inspect the company and submit its report to the commission within 60 working days, according to BSEC officials.
Sources in the company, speaking on condition of anonymity, told The Business Standard that they have received a letter regarding the inspection. The inspection team plans to conduct a physical visit and check equipment as per the commission's order, they added.
BSEC Additional Director Md Faruque Hossain heads the committee, which also includes Deputy Director Md Shahnows and Assistant Director Md Ariful Islam.
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Earlier in March this year, the commission had constituted an inspection team for this purpose. However, the previous team was unable to proceed due to a commission decision. The new commission has now taken the initiative to resume the inspection.
In November 2020, the commission approved Mir Akhter Hossain Limited to raise Tk125 crore through an initial public offering under the book-building method to expand its business, purchase equipment, and repay bank loans. The cut-off price of Mir Akhter shares was set at Tk60 each after the bidding process.
The IPO funds were supposed to be utilised within 18 months. However, the construction and engineering firm completed its use of IPO proceeds by September last year.
In March 2022, the securities regulator approved the issuance of the Mir Akhter Zero Coupon Bond worth Tk249.90 crore to refinance debt and increase capital equipment. The bond's issue price was Tk207.17 crore, with a discount rate of 7% to 9%.
From July to September 2024, the company's consolidated revenue dropped by 50%, to Tk37.67 crore from Tk74.83 crore during the same period in the previous year.
During this time, its consolidated net profit after tax fell by 12%, to Tk2.82 crore from Tk3.21 crore a year ago. Its consolidated earnings per share stood at Tk0.23, while its net asset value per share was Tk50.32 as of the end of September 2024.
In FY24, the company recommended a 10% cash dividend for its shareholders. During the year, its revenue stood at Tk268.74 crore, while its profit after tax amounted to Tk30.04 crore.
As of January 31, 2024, sponsors and directors jointly held 48.58% of the company's shares, institutions held 4.26%, and general investors held 47.16%.
The company's share price increased by 9.71%, to Tk33.90, on the Dhaka Stock Exchange on Thursday.
Currently, Mir Akhter Hossain Limited has 33 ongoing projects worth Tk9,268 crore, according to the company's annual report for fiscal year 2022-23.
Some of its notable projects include the Dhaka-Sylhet National Highway, the development of Shah Amanat International Airport, the construction of a bridge over the Payra River, and numerous road projects across the country.
Despite a decline in business performance since its stock market listing in 2021, Mir Akhter looks forward to a promising future due to its successful bids for numerous government projects, according to market insiders.
In its FY23 annual report, the company stated that the construction sector has benefitted from increased capital allocation in the government's annual development budget.
The report also highlighted several challenges faced by the country, including trade barriers, the appreciation of the dollar, high energy prices, and the ongoing Russia-Ukraine war.
