Sonali Life Insurance upgraded to 'A' category as AGM approves dividend
Sonali Life Insurance Company Limited has been reclassified to the 'A' category from the 'Z' category on the Dhaka Stock Exchange (DSE), effective from yesterday, following the company's successful annual general meeting (AGM) and approval of a 10% cash dividend for the year ended 31 December 2023.
The reclassification marks a significant improvement in the company's compliance status, as only firms declaring at least 10% dividend and holding timely AGMs are eligible for the 'A' category.
Following yesterday's announcement, Sonali Life's share price rose by 3.33% to Tk77.50 at the DSE, reflecting renewed investor confidence.
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However, as per the Bangladesh Securities and Exchange Commission (BSEC) directive, stockbrokers and merchant bankers have been instructed not to provide margin loan facilities for trading Sonali Life shares during the first seven sessions after the category change.
At its AGM held on Sunday through a hybrid system, the company confirmed the dividend declaration.
The insurer reported earnings per share (EPS) of Tk1.49, net asset value (NAV) per share of Tk35.60, and net operating cash flow per share (NOCFPS) of Tk20.16 for 2023, compared to Tk3.94, Tk55.28, and Tk70.49, respectively, in 2022.
Meanwhile, in the January-September period of 2024, the life insurance fund also shrank by Tk77 crore year-on-year to Tk791 crore.
The upgrade to the 'A' category is expected to boost market sentiment around Sonali Life, though analysts caution that the company must address its declining life fund and cash flows to ensure sustainable growth.
