Ring Shine's revenue jumps 161% in Q2  

Ring Shine Textiles posted an impressive revenue growth in the second quarter of the current fiscal year, driven by rising exports.  

In the October-December quarter, it generated revenue of Tk67.33 crore, a 161.27% increase from Tk25.77 crore in the same period a year ago, according to company officials.  

However, the company posted a loss of Tk35.32 crore, compared to a loss of Tk27.72 crore in the same period the previous year. Its per-share loss stood at Tk0.71, up from a loss of Tk0.55 year-on-year. 

The textile manufacturer suffered a significant loss due to several factors: the high cost of raw materials, the continued burden of accumulated losses, and a significant rise in other financial expenses.  

On Thursday, its share price increased by 2.33% to Tk4.40 on the Dhaka Stock Exchange.  

During the first half of FY25, its revenue soared to Tk131.84 crore, up from Tk53 crore in the same period of the previous year. The company incurred a loss of Tk74.96 crore, compared to Tk70.74 crore incurred in H1 of FY24.

Officials at the company shared the information after the half-yearly financials were approved in its board meeting today (27 February). 

They further said despite experiencing revenue growth, the company incurred the losses due to several factors.  

Firstly, the company is still carrying forward previous accumulated losses, which have continued to impact its financial performance.  

Secondly, financial overheads and Bangladesh Export Processing Zones Authority (Bepza) surcharges on outstanding dues have increased significantly, further contributing to the company's financial strain.  

Additionally, the Cost of Goods Sold (COGS) has risen compared to the same period in 2023-2024, primarily due to higher raw material procurement costs, which have placed additional pressure on the company's expenses.  

Finally, as of today, the company has not yet reached its estimated and expected break-even point, resulting in a significant squeeze in all its financial indicators.  

Recently, the Bepza terminated the land lease agreement for five plots allocated to Ring Shine Textiles Limited due to the company's long-standing failure to pay its dues.  

The company must vacate these plots within seven days, or Bepza will take possession of them. As of 31 January 2025, Ring Shine owes Bepza $12.8 million.  

Meanwhile, the company stated that it was unable to pay the dues because the securities regulator has not yet released its remaining initial public offering (IPO) funds, despite multiple applications. Currently, the company holds 50 plots under land lease agreements with Bepza.  

According to Bepza, Ring Shine has failed to pay its dues for an extended period. The authority repeatedly requested payment and provided multiple opportunities to settle the outstanding amount. 

Despite making several commitments and submitting various payment plans, the company consistently failed to fulfil its obligations and did not pay its regular dues for several months.  

Aniruddho Piaal, managing director of Ring Shine Textiles, said the company is working to fully resume operations. It has already increased its production capacity to 50%, up from below 10%.  

He said the company applied to the Bangladesh Securities and Exchange Commission (BSEC) for the release of its IPO funds, requesting $1 million, which it planned to use to clear its Bepza dues. However, it has not yet received any funds.  

He further mentioned that due to non-payment, Bepza has already suspended the company's import and export permissions. Ultimately, the authority terminated the land lease agreement for five plots of the company. Piaal added that without the release of IPO funds, it will not be possible to pay Bepza.  

In August 2023, the BSEC conditionally allowed Wise Star Textile Mills and five Singapore-based companies to acquire Ring Shine's shares, including those held by sponsor-directors.  

In September 2023, Ring Shine's board of directors raised concerns about the credibility of these six companies, which were set to collectively take over a 38% stake in the firm. Of this, Wise Star would hold only 2% of the shares, while the other five companies would hold 36%.  

In February 2023, the High Court stayed the operation of Ring Shine Textiles' board, which had been reconstituted by BSEC, for six months.  

Ring Shine was the first large manufacturing company to raise Tk150 crore through an IPO using the fixed-price method in 2019. However, after listing, it struggled to operate due to various challenges.