Quasem Industries decides to end service agreements with sister concerns
Quasem Industries used to provide marketing and distribution services for the products of the sister concerns
Highlights
Quasem Industries net income from the marketing and distribution services was Tk21.52cr in FY23
• Quasem Food Products - Tk5.98cr
• Quasem Lamps - Tk13.82cr
• Sunlite Trading and Service - Tk1.72cr
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Quasem Industries, the manufacturer of Sunlite batteries, has decided to terminate service agreements with three of its sister companies – Quasem Food Products, Quasem Lamps, and Sunlite Trading and Services.
The decision, effective from 1 October, was disclosed in a stock exchange filing today.
Quasem Industries used to provide marketing and distribution services for the products of the sister concerns.
With the termination of the agreements, the company's service income will decrease, and expenses related to selling and distribution for the sister concerns will also decline, according to the disclosure.
Following the announcement, Quasem Industries' share price fell by 5.85%, dropping Tk2.4 to close at Tk38.60 on the Dhaka Stock Exchange (DSE).
According to its 2022-23 annual report, Quasem Industries earned Tk21.52 crore in net service income from the three sister concerns. Of this, Tk13.82 crore came from Quasem Lamps, which manufactures Sunlite gas lighters.
Initiated in 2006, Sunlite gas lighters is the first and only manufacturer of gas lighters in Bangladesh, according to its website.
Quasem Food Products, another sister concern, produces Sun Chips, Sun Premium Ghee, and Sun Drinking Water. Sun Chips, launched in 2010, is a popular brand, and the company added ghee and bottled drinking water to its product portfolio in 2019.
Darul Awam Tuhin, the company secretary of Quasem Industries, told the Business Standard that the company previously used its channels to distribute the products of the sister concerns.
However, after the termination of the agreements, each company will manage its own distribution, he added.
He further said, "Quasem Industries will continue producing and distributing its own products, including Sunlite-branded batteries, torch lights, artificial quartz, air fresheners, and Wave branded shaving foams."
According to its financial statements, in the first nine months of 2023-24 fiscal, its revenue grew to Tk112.57 crore, an increase from Tk88.07 crore in the same time of the previous fiscal year.
The company posted a profit of Tk4.21 crore during July to March of FY24, however, they had incurred a loss of Tk53.34 lakh during the same period in the previous fiscal year.
In 2022-23, it reported Tk116.70 crore in revenue and a profit of Tk2.17 crore, paying a 1.5% cash dividend to shareholders.
