BAT Bangladesh to invest Tk28cr for capacity expansion

British American Tobacco Bangladesh Company – a leading multinational cigarette manufacturer – plans to invest Tk28.38 crore to enhance its production capacity and meet the growing demand for its products.

In a disclosure yesterday (24 December), the company said the investment would be financed through a combination of internal resources and bank loans, aligning with its cash flow strategy.

BAT Bangladesh operates factories in Dhaka and Savar, alongside a green leaf threshing plant in Kushtia and a green leaf re-drying plant in Manikganj. 

According to a quarterly financial statement, it produced 50,305 million sticks and 4.16 million kilograms of tobacco leaf in the first nine months of this year.

In its 2023 annual report, the company said it has been gradually investing in expanding production capacity to meet growing demand both locally and internationally. BAT Bangladesh began exporting finished goods in 2018, marking a significant milestone that opened new opportunities for the company.

Since 2021, the multinational company has invested Tk1,333 crore in its Savar factory to capitalise on emerging export opportunities for cigarettes from Bangladesh, according to the annual report. 

During the January-September period, it generated Tk155.47 crore from cigarette exports and Tk208 crore from tobacco leaf exports.

In its annual report, BAT Bangladesh highlighted that the country is strategically positioned to capitalise on significant export opportunities in the tobacco industry, including leaf, cut rag, and cigarettes. 

This advantage is driven by Bangladesh's inherent cost competitiveness and strong commitment to high product quality.

Building on the success of the ready-made garments industry, the report emphasised that the tobacco sector has substantial potential to establish a robust presence in the global export market.

BAT Bangladesh earned Tk30,843 crore from the sale of cigarettes in the first nine months of 2024. After paying taxes, its net revenue stood at Tk6,937 crore, according to its financial statement. Its net profit during this period was Tk1,322 crore, compared to Tk1,355 crore during the same time last year.

In the July-September quarter, BAT Bangladesh earned Tk8,503 crore in revenue, with net revenue amounting to Tk2,051 crore. However, its net profit slightly declined to Tk397 crore during the quarter.

Meanwhile, the cigarette manufacturer has paid a 150% cash dividend as an interim measure to its shareholders. Its shares closed 0.65% lower at Tk350.50 on Tuesday on the Dhaka Stock Exchange.