Ring Shine to settle bank debt with interest-free loan from sister concern
Share price jumps 8.82% after disclosure on the DSE website
Ring Shine Textiles, a "Z" category company listed on the Dhaka Stock Exchange (DSE), has decided to take an interest-free loan from its sister concern, Lark Textiles, to repay its high-interest bank liabilities.
The decision was approved during a board meeting held on Monday and subsequently disclosed on the DSE website today (21 April).
Following the disclosure, Ring Shine's share price jumped 8.82% to close at Tk3.70.
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Under the plan, Ring Shine will borrow Tk9.5 crore from Lark Textiles to settle outstanding dues with Eastern Bank Limited. The loan will carry a 10-year tenure, with repayments scheduled to begin in 2027 through ten equal annual instalments.
Ring Shine management hopes that replacing high-interest bank debt with interest-free funds will significantly reduce its interest burden and bolster its net income.
The company also noted that it has secured certain financial concessions from the bank under a debt rescheduling facility.
The implementation of this plan remains subject to shareholder approval, which the company intends to seek through an upcoming extraordinary general meeting (EGM) or annual general meeting (AGM).
The development comes as Ring Shine continues to grapple with severe financial distress. Since its 2019 listing, the company has declared dividends only in its debut year, failing to reward shareholders over the past six years.
The company's track record has also been marred by regulatory controversies. An earlier probe by the Bangladesh Securities and Exchange Commission (BSEC) uncovered major irregularities in its initial public offering (IPO), where a substantial number of shares were allotted without actual payment. Those shares were later sold, causing significant losses for general investors.
These beneficiaries later offloaded their shares, leaving general investors to face substantial losses.
Currently, Ring Shine is struggling with a mounting debt burden and poor operational performance.
Its last disclosed financial report for the January–March of FY26 quarter showed a staggering loss of over Tk46 crore.
