DSE restores two stocks from Z category after dividend compliance
Companies must pay at least 80% of approved dividends within 30 days to avoid Z-category classification
The Dhaka Stock Exchange (DSE) has reinstated two listed companies from the Z category to their respective categories after they completed the disbursement of declared dividends for the last fiscal year.
According to separate disclosures issued yesterday, textile manufacturer VFS Thread Dyeing Ltd has been upgraded to the B category, while pharmaceutical company Techno Drugs Ltd has been restored to the A category.
Both companies were earlier downgraded to the Z category for failing to disburse declared dividends within the stipulated timeframe.
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Under DSE listing rules, listed companies are required to disburse dividends within 30 days of shareholder approval. In a directive issued in May 2024, the Bangladesh Securities and Exchange Commission (BSEC) mandated that companies failing to pay at least 80% of the approved dividend within the specified time would be downgraded to the Z category.
VFS thread dyeing
VFS Thread Dyeing, which was listed on the bourse in 2018, was downgraded to the Z category on 24 September 2024 after failing to disburse its declared dividend for FY23 within the required timeframe.
The company declared no dividend for FY24. However, for FY25, its board announced a 0.25% cash dividend for general shareholders, excluding sponsors and directors. As per the declaration, general shareholders were entitled to receive Tk18.27 lakh as dividend.
Following approval at its annual general meeting (AGM) held on 30 December, the company completed the dividend disbursement. After receiving the dividend compliance report, the DSE upgraded VFS Thread Dyeing to the B category from the Z category, effective 15 February.
Techno drugs
Techno Drugs, which was listed in 2024, was downgraded to the Z category on 3 February for failing to disburse at least 80% of its approved dividend within the mandated timeframe.
For FY25, the company declared a 10% cash dividend for general shareholders, excluding sponsors and directors, amounting to Tk4.92 crore.
Although shareholders approved the dividend at the AGM held on 24 December, the company failed to complete the disbursement within one month.
Subsequently, after submitting the dividend compliance report to the DSE, the bourse reinstated Techno Drugs shares to the A category.
