Shepherd Industries to sell land to repay loans

Shepherd Industries PLC has announced a plan to sell a plot of land in the Rajuk Purbachal New City Project for Tk7 crore in a bid to reduce its mounting debt burden. 

In a disclosure to the Dhaka Stock Exchange today (17 September), the company said its board approved the sale at a meeting held on Tuesday. 

The land, measuring 10 kathas, 8 chhataks, and 46 square feet, had been purchased for Tk3.29 crore. The transaction is expected to generate a profit of Tk3.71 crore, which will positively impact its gross profit and earnings per share (EPS).

The company said proceeds from the sale would be used to repay or adjust outstanding bank loans.

As of March 2025, Shepherd's total loans stood at Tk164 crore, of which Tk132 crore was owed to Southeast Bank.

Completion of the deal, however, depends on necessary approvals from Rajuk and a no-objection certificate from Southeast Bank PLC, which is one of the company's largest lenders. 

Following the disclosure, Shepherd's share price rose by 1.15% to close at Tk17.60.

The company's latest unaudited financials show signs of modest improvement. Its EPS was Tk0.12 for the January-March quarter of 2025, compared to a loss of Tk0.38 per share in the same period of 2024.

For the nine months from July 2024 to March 2025, EPS stood at Tk0.47, against a loss of Tk1.18 in the previous year. 

Net asset value per share increased to Tk13.83 as of 31 March 2025, up from Tk13.41 in June 2024, driven by a net profit of Tk7.16 crore during the period.

However, net operating cash flows per share fell to Tk1.34 for July 2024-March 2025, compared to Tk2.72 a year earlier, as the company made higher payments to creditors, suppliers, and employees.

In FY24, Shepherd incurred a loss of Tk23.30 crore but still paid a 1% cash dividend to shareholders.