Lub-rref yet to utilise Tk13.10cr IPO fund
The unspent funds—held in bank accounts—had grown to Tk19.86 crore with accrued interest as of June 2025
Lub-rref (Bangladesh) PLC, a publicly listed company in the fuel and power sector, has yet to utilise Tk13.10 crore from the Tk150 crore it raised through its 2021 initial public offering (IPO), despite a sharp rise in revenue.
According to an auditor's report published on the Dhaka Stock Exchange (DSE) website on 28 September, the unspent funds—held in bank accounts—had grown to Tk19.86 crore with accrued interest as of June 2025.
The company, known for its BNO brand lubricants, raised the IPO funds via the book-building method, setting a cut-off price of Tk30 per share. General investors received shares at a 10% discount. However, Lub-rref's stock closed at Tk15 on 30 September, reflecting a significant decline in market value.
Keep updated, follow The Business Standard's Google news channel
Lub-rref has faced persistent liquidity challenges, attributed to the Covid-19 pandemic, the Russia-Ukraine conflict, and broader global economic instability. In May 2024, the firm sought regulatory approval to redirect part of its IPO proceeds towards working capital to ease financial pressures.
The auditor's report shows that by June 2025, Lub-rref had utilised Tk136.89 crore of its IPO fund—up from Tk99.42 crore in April. Between May and June alone, it spent Tk37.47 crore, including Tk13.70 crore on land development and Tk23.40 crore for working capital.
Founded in 2001, Lub-rref began commercial operations in 2006. Today, 60% of its lubricants are produced from responsibly recycled sources, with the remaining 40% derived from imported base oil.
Despite reporting a 130% increase in revenue to Tk54 crore in its nine-month financials, the company's net profit fell by 54% to Tk1.59 crore, driven by rising financial and operational costs. For the fiscal year 2024, Lub-rref posted a loss of Tk10.68 crore and declared a modest 1% cash dividend for shareholders.
