Sector Summary

Sector Market Cap Turnover

Turnover

Value

Change

PER (x) DY (%)

Bank 666,800 4,408 (913) 8.8 3.7%

Pharma 643,977 7,149 2,325 21.5 1.8%

Telecom 732,235 753 (38) 18.9 5.1%

Fuel & Power 469,382 2,778 648 12.5 5.3%

NBFI 211,527 4,269 1,637 31.9 1.5%

Food & Allied 387,280 2,237 644 18.7 3.3%

Engineering 602,924 5,457 1,135 31.2 0.8%

Cement 124,914 1,910 989 21.9 1.3%

Textile 146,594 11,173 (31) 183.2 1.4%

Miscellaneous 199,749 7,298 2,946 28.9 1.0%

General Insurance 138,655 3,980 (892) 25.1 1.6%

Life Insurance 73,559 1,852 (1,921) 42.7 1.5%

Tannery 21,931 537 (31) NM 0.7%

Ceramics 27,242 649 170 57.9 1.8%

Today Last Week1W Value

Change% ∆

DSEX 6,212.77 6,150.48 62.3 1.0

DS30 2,248.21 2,208.38 39.8 1.8

Turnover (BDT Mn) 64,107 56,247 7,860 14.0

Market cap (BDT Bn) 5,172 5,143 29.0 0.6

PER (x) 18.1

DY (%) 2.9

Gainers 228 195

Losers 136 161

Unchanged 15 22

Stock Turnover Volume Close % ∆ PER (x)

BEXIMCO 4,364 47,957,094 92.4 3.2 22.3

LHBL 1,556 25,042,775 64.2 8.3 26.0

KEYACOSMET 1,365 148,343,401 9.4 9.3 40.0

MLDYEING 1,158 35,138,419 31.7 8.9 64.1

LANKABAFIN 1,031 27,730,558 36.4 2.2 17.5

NFML 995 25,821,502 36.0 (7.7) 28.6

AMANFEED 972 15,896,675 66.4 24.3 25.6

ALIF 948 71,254,698 13.6 14.3 30.5

MAKSONSPIN 805 38,256,460 20.6 5.1 171.7

DELTALIFE 798 5,272,005 145.0 (6.0) NM

Stock Turnover Volume Close % ∆ PER (x)-

PAPERPROC 0.4 4,988 87.10 46.1 21.7

TAMIJTEX 1.7 28,821 64.90 45.8 48.0

SONALILIFE 0.4 24,223 16.00 45.5 NM

BIFC 17.2 2,552,363 7.20 44.0 NM

RENWICKJA 26.0 28,525 993.40 31.1 NM

ILFSL 157.8 20,654,790 8.00 27.0 NM

FAREASTFIN 25.5 4,520,440 5.80 26.1 NM

FAMILYTEX 112.5 25,572,000 4.50 25.0 NM

AMANFEED 971.6 15,896,675 66.40 24.3 25.6

CVOPRL 88.0 874,716 109.50 24.1 NM

Stock Turnover Volume Close % ∆ PER (x)-

MONNOFABR 128.9 4,924,944 25.50 (16.7) 294.8

NRBCBANK 450.9 15,052,030 28.10 (12.5) 11.7

AGRANINS 153.7 2,446,615 60.00 (11.9) 36.7

PRIMELIFE 34.1 534,820 61.30 (11.5) 235.8

PURABIGEN 222.2 4,896,780 43.80 (11.0) 31.5

GLOBALINS 106.9 1,698,155 60.40 (10.5) 39.0

PRAGATILIF 56.1 522,416 58.29 (9.6) NM

CRYSTALINS 101.4 1,694,952 57.60 (9.3) 13.0

PRIMEINSUR 48.0 802,169 58.20 (8.9) 30.2

SONARBAINS 246.3 2,756,966 86.20 (8.1) 36.6

Spot Market Scrips - For Tomorrow's Trading Session

Stocks Date Stocks Date Stock Start End

DACCADYE 12-Jul-21 ICBIBANK 13-Jul-21 RUPALIBANK 12-Jul-21 13-Jul-21PRIMELIFE 12-Jul-21 AMBEEPHA 13-Jul-21

RUPALIBANK 14-Jul-21 BGIC 14-Jul-21

PIONEERINS 18-Jul-21 MARICO 26-Jul-21

DSEX 52 week

Top Turnover (in BDT mn)

Gainer Loser Chart

DSEX This Week Top Gainers

Top Losers

Upcoming Record Dates Upcoming AGM

(might not contain all the stocks)

Weekly Market Review

08-Jul-21

(In BDT mn, except indicated)

Turnover Composition Market Summary

Market closes in Green | DSEX up 62 Points

Unicap Securities Limited

With two red and two green sessions, market closed in green this week. DSEX

gained 62.3 points (1.0%) to close at 6,212.77, while DSE30 gained 39.8 points

(1.8%) to close at 2,248.21. Average turnover in this week increased 14.0%

compared to previous week.

Cement sector gained highest 4.6%, while Textile sector gained 3.3%, Pharma

sector 2.5%, Ceramics sector 1.4%, Tannery sector 1.2% and NBFI sector 1.0%.

Insurance sector dropped 4.2% and Bank sector dropped 1.5%. Meanwhile,

most of the other sectors closed flat. Lafargeholcim Bangladesh posted

turnover of BDT 1,555.7mn, and gained 8.3%. Lankabangla Finance gained

2.2%, posting turnover of BDT 1,031.5mn.

4,408

7,149

753

2,7782,237

4,2695,457

1,910

11,173

7,298

3,980

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5,000

10,000

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Turnover (BDT mn) DSEX

5,500

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6,100

6,300

6,500

10,000

14,000

18,000

Wednesday Monday Tuesday Wednesday Thursday

DSEX

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Turnover (BDT mn) DSEX Index

UniCap Securities Limited Weekly Market Review

08 July 2021

Weekly News

Economy

Remittance inflows hit record $24.77bn in FY21

Remittance inflows hit a record high of USD 24.77bn in FY21, thanks to the expatriate Bangladeshis for sending money

amid the Covid-19 pandemic. Expatriate Bangladeshis sent 36% more remittance in FY21, compared to USD 18.20bn in

FY20. The inflow of remittances shows hit a record high in FY21 as the Bangladesh Bank has taken measures to

streamline the legal channels for encouraging Non Resident Bangladeshis to send money to the country, said BB Chief

Spokesperson. He said the recent flow of remittance indicates that it is gradually increasing and this trend is likely to

continue in FY22. Dr Mustafizur Rahman, a distinguished fellow at the Centre for Policy Dialogue, said one of the strong

reasons why remittance inflows have posted a significant rise is the closure of the "hundi system" owing to the

suspension of air communication suspension in the pandemic. He added that had illegal channels had not stopped,

remittance inflows would not have increased so much in a year despite the present incentive benefit. Remitters have

taken the advantage of a cut in cost for sending remittances using legal channels and non-requirement of paperwork

for a maximum of $5,000 or Tk5 lakh to receive an incentive, he added.

Merchandising export earnings target set at $43.5b for FY22

The government has set an export earnings target from goods at USD 43.5bn with a 12.23% growth for the FY22

considering the ongoing global business trend amid the Covid pandemic. Commerce minister on Tuesday announced

the total export (goods and services) earnings target at USD 51.0bn with a 12.37% growth for FY22.

Trade deficit to cross $20 billion in FY21

The country’s merchandise trade deficit is set to cross USD 20.0bn in FY21 as the deficit already stood at USD 19.84bn in

11MFY21. The gap was USD 16.09bn in 11MFY20 whereas the annual merchandise trade deficit recorded at USD

17.86bn. Deficit in trade in services stood at USD 2.30bn in 11MFY21. Exports receipts (FoB) value registered 14% YoY

growth during the period, according to Bangladesh Bank data. Merchandise export increased by 15.10% to USD

38.75bn in the FY21, according to Export Promotion Bureau data. BB data also showed that merchandise import

jumped by 17% YoY in 11MFY21, as import payments (FoB), stood at USD 54.23bn in 11MFY21.

Current account deficit narrows 58% in Jul-May of FY21

The deficit in the country's current account balance shrank significantly in FY21, thanks to high remittance inflows and

rising export earnings. The deficit in the current account balance narrowed by 58% to USD 1.84bn in 11MFY21. Export

earnings from the apparel sector grew by 12.55% YoY to USD 31.46bn. Inflows of inward remittances were strong amid

the pandemic situation and experienced 36% YoY growth to reach USD 24.78bn in FY21 from USD 18.2bn a year ago.

The deficit in trade balance widened by 23% to USD 19.84bn in 11MFY21, according to the Bangladesh Bank's data.

The import registered a 17.28% growth in 11MFY21, after bouncing back from 8.57% degrowth in 11MFY20.

Import rebounds as economy strives for recovery

Bangladesh's imports rose sharply in the first 11MFY21 as the economy enjoyed a turnaround for the time being

following the first wave of the coronavirus pandemic. During 11MFY21, overall imports stood at $58.62 billion, up 17.31%

YoY. Meanwhile, import payments declined 11.0% YoY to USD 49.97bn. Mustafizur Rahman, a distinguished fellow of

the Centre for Policy Dialogue, said import had increased mainly riding on domestic demand and higher export orders

by foreign buyers. Import of raw cotton stood at USD 2.83bn in 11MFY21, up 5.34% YoY. Yarn imports grew 18% to USD

2.08bn while that of textile and articles dropped marginally to USD 5.83bn. Rahman said the import of food-grain

increased as the government had catered a good quantity of rice to the poor to offset the economic hardship

stemming from the pandemic. Import of food-grain stood at USD 25.0bn during the period, up 60% YoY. Import

payments for petroleum products also increased 45% YoY to USD 5.46 bn, owing to the upward trend of the prices of

petroleum products in the global market.

UniCap Securities Limited Weekly Market Review

08 July 2021

Weekly News

July-May NSC sales 3.4 times higher year-on-year

The net sales of national savings certificates rose by 3.4 times YoY in 11MFY21 as savers rushed to purchase NSCs amid

a sharp decline in deposit rates in banks. Net sales of NSCs reached BDT 37,385.98 crore against the sales of BDT

11,011.1 crore in 11MFY20. The sales in 11MFY21 was BDT 17,385.98 crore higher than the government initial budgetary

projection of BDT 20,000 crore, and BDT 7,083 crore higher than the government’s revised budgetary target of BDT

30,302 crore. In 11MFY21, NSCs worth BDT 99,557.78 crore were sold against its principal payments of BDT 62,171.80

crore. In May’21, the NSD sold NSCs worth BDT 7,680.75 crore against its principal payments of BDT 5,023.41 crore,

leading to net NSC sales of BDT 2,657.34 crore.

Tax receipt grows in FY21 but misses target

Revenue collection by the National Board of Revenue (NBR) grew by 17.21% YoY in FY21 despite Covid fallout on the

economy. NBR collected BDT 2.56tn in FY21 against the collection of BDT 2.18tn FY20. Revenue collection by the NBR,

however, fell short by BDT 450.0bn of the revised target set at BDT 3.01tn for FY21. Officials of the NBR said that revenue

collection might reach BDT 2.60tn after the final calculation by the end of July. They said that it was a good sign that

revenue collection bounced back after negative growth by 2.26% in FY20. The collection would be higher if the

country had not been affected by the second wave of the coronavirus infection, they added.

Revenue rose in pandemic; big companies played a bigger role

The economy is yet to bounce back from Covid shocks, but income tax and VAT receipts in FY21 demonstrate a

recovery to the pre-pandemic level. The collection of income tax and VAT rose 14.11% and 10.82% YoY respectively in

FY21. Economists said since the FY20 had negative growth, the subsequent year seems to have seen a big boost.

According to the NBR, income tax collection was BDT 85,000 crore against the target of BDT 97,000 crore. Officials at

the income tax department said 86% of the money collected in income tax had been cut out as source tax, which

was why income tax from individuals and institutions did not fall short. The Large Taxpayers' Unit surpassed its target by

realizing BDT 24,011 crore at a growth of 15.22% in FY21. The Large Taxpayers Unit recorded significant growth in VAT

collection, as more than 50% of BDT 93,000 crore in VAT came from 157 large companies. Overall VAT collection rose

10% but the collection from large taxpayers increased by more than 16%.

Agriculture, home textile show the export diversification way

Agriculture and home textile products have come up as promising forex earners, as the two potential sectors have

clocked USD 1.0bn mark for the first time. Jute and jute goods also earned USD 1.16bn during FY21. In FY21, earnings

from home textile items grew by 49.17% YoY to reach USD 1.13bn, and agricultural products earned USD 1.02bn.

However, the total export receipts in FY21 was 5.47% below the annual target of USD 41.0bn. Among other major

sectors, frozen and live fish exports saw 4.65% growth to USD 477.37mn, earnings from the pharmaceutical sector

experienced a 24.47% jump to USD 169.0mn, and plastic goods earnings increased by 14.68% to USD 115.28mn. The

specialised textile sector registered 12.81% growth to USD 131.0mn. The earnings from merchandise shipments grew by

31.77% YoY to USD 3.57bn, but 2.52 % below the target of USD 3.67bn. Apparel shipments registered a 12.55% YoY

growth to hit USD 31.45bn, but 6.89% below the annual target of USD 33.78bn. Knitwear items fetched USD 16.96bn,

registering a strong 21.94% YoY growth. Woven items posted a 3.24% growth to reach USD 14.49bn.

Exports caught in container backlogs at ICDs

The country's inland container depots (ICDs) that handle almost 100% of the export goods are clogged up with export

containers due to a shortage of vessels and congestion at transhipment ports such as Singapore, Colombo and Port

Klang, causing the export activities to hit a snag. This crisis is also causing freight charges to skyrocket, said shippers

and the Bangladesh Freight Forwarders Association (BFFA). According the Bangladesh Inland Container Depots

Association (BICDA), the 19 ICDs can collectively store 10,000 20-foot containers but currently over 14,000 containers

are waiting for shipping at the ICD yards. The association said usually it takes 2-3 days only to send a container from

the ICDs to Chattogram port for loading to the vessels, but it is now taking 7-10 days for the same process.

UniCap Securities Limited Weekly Market Review

08 July 2021

Weekly News

July payment to ACU to bring reserve below $45b

Bangladesh Bank’s reserve would fall to USD 44.5bn in the next several days as the central bank is scheduled to pay

Bangladesh’s import bills to eight Asian countries through the Asian Clearing Union. A BB senior official told New Age

that ACU payment in the last time was made by May 10 and this time the payment would be made for the month of

May and June by July 10. ACU payment of Bangladesh would be around USD 1.55bn for the last two months, the BB

official said.

Extend the scope to non-RMG as well

Bangladesh Trade and Tariff Commission (BTTC) has recommended the government extend the duty-free raw material

import facility to the firms that sell a portion of their goods in overseas markets with a view to diversifying exports.

Currently, 100% export-oriented manufacturers get the duty-free scope while importing raw materials under the

bonded warehouse scheme. BTTC has now recommended to allow partially export-oriented sectors to import raw

materials duty-free under the bonded warehouse facility. In a report, the BTTC said Bangladesh exports 750 types of

products, of which 659 types of products come from four sectors, namely steel and iron, chemicals, electronics and

electrical, and furniture. But the bonded warehouse facility is not available for the entrepreneurs in these four sectors,

although about 80-90% of the raw materials used by them are imported. As a result, the entrepreneurs in these sectors

pay 30-65% duty at the import stage. According to the report, entrepreneurs in Vietnam have been enjoying such

benefits for a long time.

More tax cuts in future if revenue rises: NBR chair

National Board of Revenue will further reduce tax rates in future if revenue collection increases in line with the

reduction in rates the government offered in FY22, said NBR chairman. He added that NBR will observe the outcomes

of the waiver and further waiver will be offered both in VAT and corporate tax if revenue collection increases.

Refineries to get BB approval on raw gold import

Bangladesh Bank has allowed import of raw gold ore or semi‑refined gold dore only by gold refinery companies which

would receive approval of the commerce ministry. The BB initiative came within 19 months of allowing legal import of

refined gold by central bank licensees, paving the way for enhancing dependence on gold refined in Bangladesh

along with widening the scope for exporting refined gold and gold ornaments from the country.

Benapole port’s FY21 revenue collection deficit Tk2,144.62cr

Benapole Customs House, the largest land port in the country, failed to meet revenue collection targets in FY21 due to

various obstacles caused by the Covid-19 pandemic. The port incurred a deficit of BDT 2,144.62 crore against the

revenue target of BDT 6,244.62 crore that year. However, revenue collection increased by Tk1,248 crore YoY.

Entrepreneurs of cottage, micro, small business to get term loan

Bangladesh Bank issued a circular that made cottage, micro and small entrepreneurs eligible for receiving term loan

from the BDT 20,000-crore stimulus package. BB also made such borrowers would also remain eligible for receiving

working capital loans. In both cases, the cottage, micro and small entrepreneurs would receive one-year’s interest on

loans as compensation. The medium entrepreneurs would not be eligible for receiving such term loans from the

package, however, they would receive working capital loans along with one-year’s interest as compensation.

New Development Bank asked to expedite Bangladesh's membership

Bangladesh has called on the New Development Bank (NDB) to expedite awarding its membership of the Shanghai-

based multilateral lending institution, officials said. Earlier at a meeting in February last, Bangladesh had informed the

NDB president about the formal decision to join the development bank as a shareholder. Bangladesh sought at least

1.0% stake in the bank, however, Dhaka will have to pay some USD 382.0mn in the next seven years for becoming a

shareholder of the bank.

UniCap Securities Limited Weekly Market Review

08 July 2021

Weekly News

Formulate 5-year national digital platform economy development plan: CPD

Bangladesh should immediately formulate a five-year national plan to develop its digital platform economy as the

transformation towards online platform-based economic activities has already begun here, said experts at a webinar

organised by the Centre for Policy Dialogue (CPD) on Monday. Speakers said digital platforms are like matchmakers

between buyers and sellers online, eliminating middlemen to reduce entry barrier for small firms, making purchase of

products and services more convenient and affordable, and also increasing the efficiency of business activities

through the utilisation of technology. Syed Yusuf Saadat, Senior Research Associate of the CPD, told that Bangladesh

now is the second largest supplier of online workers to the global market and is considered to grow more in future,

thanks to the low-cost of labour here. Bangladesh's market share in the global business process outsourcing has

increased to 16%, he added. App-based ride sharing in Dhaka city alone had created an annual market of around

BDT 2,200 crore before the sector began to suffer disruptions due to the pandemic last year, said the CPD researcher.

Plenty of empty containers, only a few are handy

A lot of empty containers are lying idle at the private inland container depots (ICDs) in Bangladesh when the ICDs are

choked with export cargoes for failing to ship them on time due to an acute shortage of empty boxes. As of Monday,

26,336 empty containers were sitting idle at 19 private ICDs. Of them, there are 13,647 boxes of 20-foot containers,

while the remaining 12,689 are 40-foot containers. Bangladesh Inland Container Depots Association (BICDA) Secretary

said small-sized 20-foot containers are not preferred to carry export cargoes, as the bigger 40-foot containers are more

suited for the purpose. Director of the Bangladesh Freight Forwarders Association, said many of the empty containers

are idling as their owners, shipping companies or mainline operators (MLOs), do not provide services to the ports in the

US and the EU. He told that the most required MLOs for transporting goods from Bangladesh are Hapag-Lloyd,

Mediterranean Shipping Company (MSC), Hyundai Merchant Marine, CMA CGM, and Maersk Line. There is an acute

shortage of empty containers of these MLOs, he said.

Pharma export thrives on Covid medicines

Pharmaceutical shipments from Bangladesh grew 25% YoY to USD 169.0mn in FY21 thanks to the addition of anti-

coronavirus drugs to the export basket, continuous improvement of quality and policy support. Drugs worth USD

136.0mn were exported in FY20. Bangladesh mainly exports medicine related to malaria, tuberculosis, cancer, leprosy,

anti-hepatic, penicillin, streptomycin, kidney dialysis, homoeopathic, biochemical, Ayurveda and hydrocele. Anti-

coronavirus drugs, particularly anti-viral drugs like Remdesivir and Favipiravir, which were used to treat coronavirus

patients, drove the export growth in FY21. Around BDT 400 crore worth of anti-coronavirus drugs were exported in FY21.

Several Middle Eastern, African and Latin American countries imported the generic versions of Remdesivir and

Favipiravir. The country also benefited from an Indian ban on the export of Remdesivir and its active pharmaceutical

ingredients in April after a record spike in Covid-19 cases sent demand surging.

Wheat import declines by 18pc

Import of wheat has declined notably by more than 1.13mn tonnes or 18% YoY in FY21. Rising costs of the grain in the

global market as well as some risk factors related to imports caused the plunge during this pandemic when demand

has increased in real terms, said traders. Meanwhile, low imports and considerably tiny local production have caused

a price surge of wheat flour and baked items in the country significantly, adding to woes of commoners already hit

hard by the Covid-19 pandemic, said insiders. The private sector and the government combined imported around

5.30mn tonnes of wheat in FY21, while the import volume hit an all-time high of 6.43 million tonnes in FY20. Director of

City Group told that Russian and North American wheat prices rose to US$340-400 a tonne in recent times. Fear of any

massive decline in prices forced millers to import the item 'conservatively' to avoid losses, he added. However, the

National Board of Revenue (NBR) had removed the 5.0% AIT on imported wheat in December 2020. The global trade

web-portal Index Mundi data also showed that prices of wheat increased by 20-25% in 1HCY21. Average global prices

crossed $290 a tonne in recent months, according to the portal.

UniCap Securities Limited Weekly Market Review

08 July 2021

Weekly News

TRIPS transition period for LDCs extended by 13 years

The transition period of the Trade-Related Aspects of Intellectual Property Rights (TRIPS) for the LDCs has been

extended till July 1, 2034. The US and the European Union were not agreeable to such a long transition period.

However, as Bangladesh will graduate from the LDC in 2026, it will not be able to utilise the TRIPS waiver after 2026.

Now, Bangladesh will now need to invest in research and development and build capacity as it would face patent

restrictions once it moves out of the group of the LDCs in 2026. Bangladesh is negotiating at the WTO to retain trade

benefits, including duty-free privileges for 12 years after the LDC graduation, he said.

BB extends deadline for foreign entities seeking loans until end of this year

Bangladesh Bank (BB) has extended the deadline for foreign-owned and controlled companies, which are operating

in the country, to gain access to domestic finance in local currency against overseas guarantees until the end of this

year. BB has said that the decision to extend the deadline was made due to the ongoing Covid-19 pandemic.

However, any such financing would need to be informed to the relevant central bank department within a week of its

sanctioning. In Jul’20, Bangladesh Bank had relaxed its policy to allow local banks and NBFIs to issue credit to the

entities in local currency against foreign guarantees.

More than 40pc of VAT Online Project funds unspent

BDT 3.0bn (~43%) of the VAT Online Project (VOP) remained unspent even after the end of its tenure this June 30.

Officials said the project underspent the allocation as some of the planned steps were dropped due to the prolonged

Covid-19 pandemic. As per an Economic Relations Division's project-closing and verification report commissioned by

Deloitte, some 90% of the project task was done until June 30. VOP senior officials said 13 modules have been

developed to automate VAT administration while the remaining 3 would be completed by July 2021.

Mongla Port sees anchoring of record 970 foreign ships in FY21

Mongla Port witnessed the anchoring of at least 970 foreign ships in FY21, breaking all previous records in its history. The

ship mostly contained car, coal, fertilizer cement clinker, LPG carrying vessels, ceramic materials, various raw materials

and equipment of Rooppur nuclear plant and railway line project etc. In FY20, the port witnessed anchoring of at least

903 foreign ships while 912 in FY19, 784 in FY18, and 623 in FY17. A total of thirteen development projects and seven

ADB programmes were implemented from 2009 to 2020 involving Taka over 20.0 billion aiming to enhance the ability

of Mongla Port, deputy secretary of Mongla Port Authority had said. Chairman of Mongla Port Authority informed that

the port has earned a profit of BDT 3.38bn in FY20, and BDT 3.40bn in FY21.

Stakeholders call for alternative shippers

Exporters should convince their buyers to allow the use of alternatives to the few designated shippers to quickly end

the backlogs in cargo shipment, recommended stakeholders. Currently, a few main-line operators (MLOs) are usually

nominated to carry a major portion of export cargoes, they said. This prevents booking other MLOs' empty containers,

causing them to lie idle at private inland container depots (ICDs) alongside an unprecedented pileup of export

cargoes at those depots, they observed. Exporters urged the government to take steps, such as arranging direct

operation of small sized vessels from the Chattogram port to export destinations. There could be feeder vessels running

from Chattogram to China to connect with mother vessels reaching export destinations in the US and Europe, they

said. The shipping agents urged Chittagong Port Authority (CPA) to allow some space at the port for storing a portion

of export-loaded containers to help the ICDs get rid of the backlog.

New company registration surges despite pandemic

Despite the pandemic, 13,613 new companies were registered in Bangladesh in FY21 which is up 22.50% from 11,110

firms that were incorporated in FY20. Some 12,107 private companies took registration in FY21, up 34.37% YoY. In

Bangladesh, there are 3,587 public limited companies, 186,825 private limited companies, 974 foreign companies,

51,332 partnership firms, 1,143 trade organisations, and 15,253 societies, data from the RJSC showed.

UniCap Securities Limited Weekly Market Review

08 July 2021

Weekly News

Plan big to diversify exports

Bangladesh needs to formulate long-term plans on how to enhance its export basket after graduating from the UN's

group of Least Developed Countries (LDCs), experts say at a webinar held. Related measures could include providing

low cost and easy access to finance, adequate policy support along with fiscal and non-fiscal incentives for non-

garment export sectors while ensuring equal treatment and skills development, they said. Mustafizur Rahman,

distinguished fellow of the Centre for Policy Dialogue (CPD), said the government should focus more on non-garment

sectors with good export potential as diversifying the country's export basket would help address the existing and new

challenges after graduation in 2026. He added that the garment sector is a success model for Bangladesh, but now is

the high time to focus on other potential non-garment sectors like agriculture, pharmaceuticals, light engineering, ICT,

leather goods and jute. He also said that at present, 70% of Bangladesh's exports get preferential access to certain

markets but to continue enjoying such benefits after graduation, compliance will be a major issue. Besides, the

Bangladesh Standards and Testing Institution needs to be strengthened to ensure that local products face

international standard testing to secure accreditation. Rahman suggested the country's legal capacity should be

increased as well since commercial disputes could increase significantly post-graduation.

Lockdown may slow recovery

The lockdown reinstated to curb the latest surge in coronavirus infections is likely to slow the pace of economic

recovery in Bangladesh, said the central bank in a report. The economy had rebounded strongly in 3QFY21 thanks to

strong growth in manufacturing output and exports and imports as consumer confidence grew. Recoveries of

Bangladesh economy confronted new headwinds from the increasing infection rate and associated restrictions

measures to check the new surge since April 2021. Travel restrictions from Bangladesh to other countries are likely to

dampen migration, remittances and exports to some extent, it said. According to the report, manufacturing output

rose more than 8.76% in the quarter thanks to the 14.47% expansion in manufacturing of textile, 56.38% in leather and

leather products, 15.25% in pharmaceuticals, 18.46% in chemical and chemical products, 14.67% in non-metallic

mineral product, and 368.21% in electrical equipment. Industrial production was up 8.27% year-on-year, mostly owing

to favourable demand-side factors such as higher remittance inflow, substantial credit to trade and commerce, and

consumer finance.

Bangladeshi poor bear over 12pc burden of VAT: Study

VAT is an injustice for the poor in Bangladesh as they have to shoulder the burden of 12.1% of the regressive tax on

their income. A study styled 'Aid to Pro-poor Domestic Revenue Mobilisation: The World Bank's Revenue Mobilisation

Programme for Results in Bangladesh' revealed this on Wednesday. According to the survey jointly conducted by

SUPRO and Oxfam Bangladesh, the burden of VAT is only 5.9% for the rich. The aim of the study was to evaluate the

WB-funded VAT Online Project. It alleged that the WB project would increase the existing tax burden on the poor

people and increase dependency on indirect tax. The report said the project was taken without proper assessment or

feasibility study and stakeholders feared inflation that would harm poor consumers, and SMEs. It recommended that

the donors do not impose any policy reform as it should be open and transparent for stakeholders.

Bank and NBFI

NBFI clients’ loan repayment time extended till Aug

Customers of non-banking financial institutions will not be defaulters if they repay, by 31 August, at least 50% of loan

installments due in June. But the balance of the installment has to be paid with the next installment, according to a

Bangladesh Bank circular on Monday. Earlier, the same facility was provided for banks on 27 June. The circular said no

penalty interest, additional charges, fees or commissions can be imposed on the loans till August 31. If the interest or

profit of the loan, to which the facility is being provided, is recovered, it can be transferred to the income of the

financial institutions. Apart from this, other existing policies related to loans and interest will remain in force.

UniCap Securities Limited Weekly Market Review

08 July 2021

Weekly News

Banks log higher than expected profits despite slowdown

Banks in Bangladesh posted a hefty operating profit in 1HCY21 despite the business slowdown caused by the

coronavirus pandemic, data of 20 lenders showed. The lower interest rate on deposits and the moderate lending rate

helped banks register the higher operating profit during the first half of 2021, bankers said. Lenders also managed a

good profit from their investment in the capital market, and the foreign exchange business also made a turnaround by

dint of commissions and fees coming from the sharp increase in exports and imports. A number of officials of the

Bangladesh Bank, however, said that some banks might have shown their incomes from credits even if they did not

get any instalment on the loans in the first half of the year. Islami Bank Bangladesh posted profit of BDT 1,020 crore in

contrast to BDT 1,007 crore in 1HCY20. The profit in Dutch-Bangla Bank stood at BDT 504 crore, up 21% YoY. Managing

director of Southeast Bank, said that his bank had cut operating expenses recently, which led to 38% YoY growth in

profit, reaching BDT 472 crore. Managing director of Jamuna Bank told that the investment in the secondary bond

market had helped his bank post a hefty profit, rising 15% YoY to BDT 301 crore. The bank has invested more than BDT

10,000 crore in the secondary bond market. Additional managing director of Pubali Bank said Pubali's profit stood at

BDT 503 crore, up 25.43% YoY.

Use ICAB to verify borrowers’ info, regulator asks banks

Bangladesh Bank issued a circular on Tuesday directing scheduled banks to utilise the Institute of Chartered

Accountants of Bangladesh's (ICAB) Documents Verification System for online verification of institutional borrowers'

financial information. The circular further states that a proper utilisation of this system will boost credit discipline and cut

down defaulted loans in the country's banking sector. At least 2 lakh companies are registered in Bangladesh, and

among them, around 1.55 lakh are currently in businesses here. ICAB members conduct audits on about 16,000 of

these companies, and the banks can verify their information using the institute's Documents Verification System.

State-owned commercial banks disburse lavish incentive bonus

Bangladesh Bank has advised the Financial Institutions Division (FID) of the Ministry of Finance to take actions against

the loss-incurring state-owned commercial banks (SoCBs) that have been disbursing incentive bonus to their

employees every year. BB had prepared the 'incentive bonus rules' for the SoCBs back in December 2014 at the

request of the MoF. However, the unified rules are not being followed by the SoCBs even more than six years after their

formulation. According to the rules, the employees should get incentive bonus based on the net profit to be made by

the respective institutions, and that they should not get the same if banks fail to make profit. The rules also suggested

fixing the incentive bonus based on a bank's net profit, only after making necessary provision against the classified

loans and other soured assets, and when the liquidity position would remain at a satisfactory level. The Sonali Bank,

Agrani Bank, Janata Bank and Rupali Bank disbursed Tk 4.373 billion to their employees in incentive bonuses despite

incurring a cumulative loss of Tk 185 billion in 2019. However, providing incentive bonus to employees by Basic Bank,

Bangladesh Krishi Bank and Rajshahi Krishi Unnayan Bank.

MFS transactions reach fresh record of Tk 71,247cr in May

Transactions through the mobile financial services reached a fresh record of BDT 71,246.9 crore in May’21 due to

addition transactions during Eid-ul-Fitr, and restrictions on public movement amid the Covid outbreak. Bangladesh

Bank data showed that the transaction volume in May is 12.3% higher than the BDT 63,441.2 crore in transactions in

Apr’21. Nagad managing director Tanvir A Mishuk told New Age that people were more inclined nowadays to online

shopping and other purchases after the Covid pandemic. Daily average transactions though bKash was above BDT

2,000 crore with the number of transactions through its platform reaching above one crore in May, taking its monthly

transactions to above BDT 60,000 crore and around 30 crore transactions. The total number of transactions through all

the MFS licensees of the central bank was 34.67 crore in May, the BB data showed. The BB data showed that shipping

spending through MFS reached Tk 3,650.5 crore, salary disbursement stood at Tk 2,786 crore, the government’s

payments stood at Tk 1,309.2 crore and utility bill payment reached Tk 1,107 crore, among others. The number of

subscribers of the MFS operators reached 9.81 crore at the end of the month.

UniCap Securities Limited Weekly Market Review

08 July 2021

Weekly News

Energy

12kg LPG of private companies to cost Tk49 more from July 1

Bangladesh Energy Regulatory Commission (BERC) has re-fixed the price of LPG of private companies at retail level

with effect from July 1. As per the new price, a 12kg LPG cylinder will be sold at BDT 891 based on the Saudi Contract

Price (CP). The price of state-owned LP Gas Company will remain the same at BDT 591 for 12.5kg LPG as it has no

relation to the Saudi CP. The value of per kg of LPG was considered to be BDT 70.24, including VAT, and such price will

be applicable for refixing the price of other weighed containers. The auto gas price was also refixed at BDT 44/litre

against the current price of BDT 41.47 under the price adjustment procedure.

Higher LNG cargoes from 'volatile' spot market targeted

Bangladesh is importing significantly higher LNG cargoes from spot market this year to meet its gas demand.

PetroBangla will import 18 LNG cargoes from the spot market in 2021 against only one cargo in 2020. It will import 64

cargoes in 2021 from term suppliers, compared to 62 in 2020. PetroBangla will import 40 cargoes from Qatargas and 24

from Oman Trading International. Petrobangla bought one LNG cargo at USD 13.42/MMBTU for 138,000 cubic metres

of LNG for late July 2021 delivery from the spot market. LNG price under term deals is USD 9.0/MMBTU, according to a

senior Petrobangla official. Energy experts and rights groups opposed Petrobangla's LNG import strategy and

suggested less dependency on spot market where the price usually remains volatile. Petrobangla could have

purchased LNG from the futures market, said Mr Tamim, a former special assistant to a caretaker government.

BPC counts loss as global prices soar

Bangladesh Petroleum Corporation (BPC) has started counting losses after five years following higher fuel oil prices

globally. It now incurs a loss of an estimated BDT 80.0mn a day in oil trading, according to sources. To reduce losses,

energy ministry increased the price of furnace oil by BDT 11 per litre to BDT 53 per litre with effect from July 04.

Presently, BPC incurs a loss of BDT 6.0 per litre in diesel trading. Despite furnace oil price hike, it suffered a loss of around

BDT 1.0-1.5 per litre as on July 04. Every day, the BPC sells 12,000 to 15,000 tonnes of diesel in domestic market after

imports. Diesel now retails is BDT 65/litre. The BPC is at a break-even position in octane trading. Oil price in the

international market is currently witnessing an uptrend following its steepest fall during the acute Covid-19 pandemic

after March 2020. For price fall, the BPC made a profit of BDT 16/litre in diesel and BDT 5.50 per litre in trading of the

respective petroleum products in domestic market. Officials said the BPC had racked up hefty profits riding on the

sharp fall in oil prices globally over the past six years since 2015. The price of kerosene at retail level is BDT 65 per litre

while octane and petrol prices are at BDT 89 and BDT 86 per litre respectively.

Textile

Textile sees investment boom during pandemic

Textile entrepreneurs came out with a huge investment amid the deadly coronavirus pandemic to boost production

capacity and adopt new technology, all to meet the growing export demand of the country's apparel sector.

Investments worth ~USD 500.0mn are in progress to expand and modernise production facilities to meet the growing

demand mostly of manmade fibre in the international market, industry insiders say. Many textile manufacturers are

now overwhelmed with export orders, which they will not be able to complete in time by using their current capacity,

they added. Besides, trade tensions between the US and China have also encouraged local entrepreneurs to invest in

some value-added yarn and fabrics. They further added that as a backward linkage, the textile sector lags behind in

the production of blended yarn and fabrics like polyester, synthetic, viscose and lycra. Meanwhile, Bangladesh's

competitor countries have been upgrading their technology for producing these products. This also has made

entrepreneurs in the local textile sector invest heavily in modernising factories and increasing production capacity.

Maksons Group has announced that it is investing around BDT 1,000 crore in three new spinning units in Mirsarai

Economic Zone. Its Metro Spinning Limited will invest BDT 340 crore in a unit, while Maksons Spinning Mills will pour BDT

254 crore and BDT 348 crore into two other units. In the manner of Maksons Group, Envoy Group, New Asia Group, DBL

Group, Pride Group, ShaSha Group have decided to make huge investments during the pandemic.

UniCap Securities Limited Weekly Market Review

08 July 2021

Weekly News

RMG export exceeds FY21 target

Bangladesh's apparel export has surpassed the USD 30.76bn target set by the Export Promotion Bureau (EPB) for the

immediate past FY21, say sources at the garment exporters association. In FY21, the country exported apparel items

amounting to USD 30.86bn, which is 10% higher YoY. Bangladesh Garment Manufacturers and Exporters Association

(BGMEA) came up with the calculation based on the National Board of Revenue (NBR) data. But the EPB is yet to

make the official announcement. With the export volume cruising nicely even amid the Covid-19 pandemic, the RMG

manufacturers expect better business performances in the upcoming months. Mass vaccination in the US and Europe

has helped western orders get back on track. However, they are worried about hikes in raw materials and freight

charges, plus the price drop of RMG items in the international market.

Cotton price hike strains RMG makers

Rising cotton prices have come as a fresh blow to the apparel industry, putting stress on profitability of clothing

business both in local and export markets. Local dressmakers say they cannot revise their prices upward accordingly,

keeping in view the low demand in the market and the decline in people's purchasing capacity during pandemic. As

a result, they are bearing the pressure of the extra cotton price. Big clothing retailer brands are also facing the same

problems. President of the Bangladesh Textile Mills Association (BTMA) told The Business Standard that the price of

cotton was 58-60 cents per pound before the pandemic last year, and it is now USD 1.2. He added that the price of

yarn was USD 2.60-2.70 per pound during the pandemic last year and now it has increased to USD 4.10. He also said

the production of cotton is not increasing in line with the growth in demand. He added that the harvest of cotton was

hampered last year due to the pandemic, and this year's forecast also predicted a lowered cotton production.

BGMEA, BFFA for direct vessel operations with Europe, USA

Apparel exporters and freight forwarders have demanded that the Ministry of Shipping take up an initiative to launch

direct vessel operations from Chattogram port to Europe and the USA to resolve the crisis the country's export sector is

facing due to a shortage of vessels and congestion at transhipment ports. The country's inland container depots (ICDs)

that handle almost 100% of the export goods are clogged up with export containers due to a shortage of vessels and

congestion at transhipment ports such as Singapore, Colombo and Port Klang. According to the Bangladesh Inland

Container Depots Association (BICDA), the 19 ICDs can collectively store 10,000 TEU export containers but currently,

over 14,000 TEU of exports-laden boxes are waiting for shipping at the ICD yards.

Apparel export to US rises by 15.38pc in Jan-May

Bangladesh’s apparel export to USA in 5MCY21 grew by 15.38% YoY to USD 2.58bn, according to the US Department of

Commerce’s Office of Textiles and Apparel. Apparel export to the US in May’21 increased to USD 587.95mn from USD

166.58mn in May’20. Bangladesh Garment Manufacturers and Exporters Association (BGMEA) vice-president told New

Age that Bangladesh’s export to the US market will increase more in the coming months as the economy of the

destination is recovering from the shock of Covid-19. He said that Bangladesh’s apparel export to the US started

rebounding for the last two months as the US shifted some orders from China and at the same time production was

interrupted in India due to a high rate of infection. USA apparel import from China in 5MCY21 grew by 26.17% YoY to

USD 5.82bn, import from Vietnam grew by 19.48% YoY to USD 5.74bn, import from Cambodia increased by 15.35% YoY

to USD 1.24bn, and import from India increased by 21.95% YoY to USD 1.73bn.

BGMEA welcomes Walt Disney's move to reinstate Bangladesh as sourcing country

The BGMEA has welcomed Walt Disney's move to reinstate Bangladesh as a permitted sourcing country. The Walt

Disney Company once stopped its sourcing from Bangladesh in 2013 amid the fire and building collapse disasters. It

has now considered including the country in its Permitted Sourcing Country list with ILS (International Labor Standard)

audits. BGMEA said factories participating in the ILO's Better Work Bangladesh program will be entitled to become a

vendor, while they need to participate in the Nirapon or RMG Sustainability Council (RSC) along with specific

remediation fulfillment criteria.

UniCap Securities Limited Weekly Market Review

08 July 2021

Weekly News

Telecom

Operators eye SIM-locked phones to ramp up 4G use

Mobile phone operators are seeking permission from the government to sell network-locked or fixed-SIM handsets at

lower prices so that more people can afford smartphones and use 4G service. Director-general for spectrum at the

Bangladesh Telecommunication Regulatory Commission (BTRC) told that they are analysing the proposal, and will

make a decision soon. He added that the handset prices were at a tolerable level, so selling the devices in instalments

would not suffice. Under the proposal, customers will have to buy the handset from an operator, and the operator's

SIM must be used until the repayment period is over. In Bangladesh, following the introduction of 4G in 2018, 28% of the

mobile phone subscribers currently use the service, although 4G capabilities can cover 95% of internet users.

Operators say they have set up more than 36,000 4G sites and spent heavily in other areas, such as purchasing

spectrum. According to the AMTOB, four operators have invested BDT 28,000 crore in the 4G service. To increase the

number of 4G subscribers, the AMTOB plans to sell handsets on instalments by locking them to a specific carrier.

Operators plan to bring 100% of the population under 4G coverage by 2025. According to their estimate, 40% of the

customers will use 4G in 2021, 60% in 2022, 75% in 2023, 85% in 2024, and 100% in 2025. General secretary of the

Bangladesh Mobile Phone Importers Association said that manufacturers had nothing to do with reducing prices

because there are many other issues involved, including taxes. He added that the price of locally made handsets is

already low compared to other countries, which means operators should make attractive offers when customers buy

a handset, whether the network is locked or not.

Mobile phone validation begins

The telecom regulator has started running a process to verify the validity of mobile phones from today to curb illegal

mobile phone inflow and boost local mobile manufacturing and revenue collection. Bangladesh Telecommunication

Regulatory Commission (BTRC) will launch the National Equipment Identity Register (NEIR) on a trial basis for three

months, enabling it to disconnect unregistered phones from the network. According to the BTRC, the mobile phones

that customers are using now will have been automatically registered by June 30. From July 01, the registration will be

completed through connecting the IMEI of the mobile phone with the customer's national identity card number and

SIM number. The new mobile phones that will be connected to the network from today will be initially activated on the

network and subsequently the validity of the phone will be verified through NEIR. If valid, the mobile phone will be

automatically registered and active on the network.

Hiked tariff slims down growth of app-based call services

Local app-based call service providers worry over the diminishing opportunity of their business growth after the

telecom regulator hiked tariff to increase their call rate amid pressure from mobile operators. Internet Protocol

Telephony Service Providers (IPTSP) said off-net calls had cost BDT 0.30/minute until April, when Bangladesh

Telecommunication Regulatory Commission (BTRC) increased the tariff in May to BDT 0.40/minute, narrowing the gap

with the call rate of mobile operators, which is BDT 0.45/minute. As a result, the factors, cheaper call rate and off-Net

accessibility, no longer seem significant. Neither the number of subscribers of such apps is growing, nor is the volume of

calls. Posts and Telecommunication Minister told The Business Standard that the tariff had been increased to strike a

balance between call rates of mobile operators and IP telephone operators. He added that app-based call rate was

much lower than the mobile operators' call rate, and that the government cannot kill one by keeping afloat another.

According to the BTRC, the government issued 38 licences to IPTSPs since 2009 to promote the usage of Internet in

remote areas and to make telecommunication cheaper.

UniCap Securities Limited Weekly Market Review

08 July 2021

Weekly News

Real Estate

X Ceramics to go for high-end tiles

X Ceramics, an associate of Index Agro Ltd., is set to make a fresh investment of BDT 244 crore to establish a high-end

tile production facility to cater to the demand among upscale product seekers. X Ceramics has a combined

production capacity of 30,000 square metres per day at two manufacturing units. The company's annual turnover is

about Tk 350 crore. X Ceramics has already placed its investment plan to the Bangladesh Economic Zones Authority,

seeking 30 acres of land at the Bangabandhu Sheikh Mujib Shilpa Nagar in Chattogram for the new unit. According to

the Bangladesh Ceramic Manufacturers and Exporters Association, there are currently about 30 tiles manufacturers in

the country that produce around 20.64 crore square metres of tiles every year with consumption amounting to Tk 4,600

crore in 2019-20. Investment in the tiles sector of the ceramics industry reached Tk 5,235 crore. Deputy managing of Mir

Ceramic said the demand for premium tiles is still low compared to the common variety. Senior marketing manager of

Akij Ceramics said the demand for high-end tiles was previously fulfilled through imports but local manufacturers now

cater to about 84% of the total requirement.

Rod prices surge for costlier raw materials

The price of MS rods has increased by BDT 1,500 per tonne in Bangladesh in June because of the rising cost of raw

materials globally, making building houses and implementing infrastructure projects costlier. The spike in the price

came even though the source tax was slashed in the FY22 budget. Manufacturers blame the increasing cost of

melting scrap in the international market for the price hike in the local market. So, the cost of building private homes

and implementing infrastructures and development projects will not decline. The retail price of 60-grade MS rod rose

to BDT 75,000 per tonne, up from BDT 73,500 per tonne one month ago, data from the state-run Trading Corporation of

Bangladesh showed. Rod prices jumped 38% in the last year as millers were compelled to hike the rates in the wake of

spiralling scrap prices in the global market. In 2020, 60-grade MS rods were sold for BDT 54,000 per tonne after the

demand went down to almost zero due to the coronavirus pandemic, putting the brakes on the construction sector.

The price of melting scrap, which was USD 300-350/tonne in Oct’20, has risen to USD 590. Around 70-85% of the melting

scrap used by the domestic steel industry has to be imported, while the rest is produced locally. At present, the import

duty on melting scrap is BDT 1,500 per tonne, while the AIT at the import stage is BDT 500 per tonne. Although the 4%

AIT has been withdrawn at the import stage for FY22, it is necessary to slash the import duty on raw materials from BDT

1,500 to BDT 500 per tonne, the AIT on imports from BDT 500 to BDT 300, and the VAT at the sales stage from BDT 2,000

to BDT 500.

Miscellaneous

Japan Tobacco’s huge FDI can’t find footing in Bangladesh

Japan Tobacco International came to Bangladesh with the highest-ever investment in the country's history, but it

failed to fare well because of what its officials claim was the dominance and anti-competitive activities of British

American Tobacco. They have also blamed the government's tax policy. Japan Tobacco’s market share was 19.8%

back in 2018, which has now come down to 12.6%. Its cigarette sales also fell significantly in this period. Experts blame

Japan Tobacco's hiring of foreigners in top positions who could not produce and market products in line with the taste

of local consumers. Head of corporate communications at Japan Tobacco said they had filed the complaint with the

competition commission as they had faced anti-competitive activities and dominant behaviour from a leading

market player. She also said they were unable to proactively divulge any more information about this due to the

sensitive nature of the complaint and to maintain confidentiality. Bangladesh Competition Commission Chairman said

they were looking into Japan Tobacco's complaint.

UniCap Securities Limited Weekly Market Review

08 July 2021

Weekly News

Capital Market

Unpaid IPO fund, right shares must be sent to BSEC’s market stabilisation fund

Bangladesh Securities and Exchange Commission (BSEC) has asked listed companies to send to its capital market

stabilisation fund unpaid public subscription money and right shares in addition to unclaimed cash and stock dividend.

The Capital Market Stabilisation Fund must be a perpetual fund for functioning as a custodian of undistributed or

unclaimed or unsettled dividend (cash or stock) or un-allotted rights shares or non-refunded public subscription money

in favour of the shareholders or stockholders or investors, the rules said. Earlier on January 14, the BSEC issued a

directive saying that any amount of cash or stock dividend remained as unpaid or unclaimed or unsettled, including

accrued interest income thereon, within three years from the date of declaration or approval must be transferred to

the Capital Market Stabilisation Fund. According to the new notification, at least 50% of cash balance of the fund

must be used for providing loan to market intermediary for refinancing as margin loan while the maximum 40% of cash

balance of the fund may be used for direct buying and selling of listed securities. The maximum 10% of cash balance

of the fund may be used for investment in other securities, including fixed deposits, government securities, fixed

income securities and mutual funds, it said. The BSEC officials said that the regulator would control the volatility and

liquidity on the capital market through the fund.

SBAC Bank’s IPO subscription opens Monday

The initial public offering (IPO) subscription of South Bangla Agriculture and Commerce (SBAC) Bank will open on 5 July

(Monday) and will continue until 11 July. General investors participating in the subscription will receive primary shares.

On 9 May, the Bangladesh Securities and Exchange Commission (BSEC) allowed the bank to raise BDT 100 crore

through an IPO. Its Chairman SM Amzad Hossain owns 3.21% of its shares and his wife Begum Sufia Amjad, a director of

the bank, holds 3.36%. They both are also the directors of the listed company Khulna Printing and Packaging, which is

a losing concern of Lockpur Group.

1.22 lakh BO accounts closed in June

Central Depository Bangladesh Limited (CDBL) closed around 1.22 lakh beneficiary owners' (BO) accounts in June as

the account holders did not renew them. On 31 May this year, the number of active BO accounts was 26.59 lakh,

which stood at 25.36 lakh at the end of June, according to the CDBL. Sources said investors who had more than one

BO accounts have not renewed them as they are not going to benefit by using them under the new system.

Now investors can transfer shares from anywhere

Dhaka Stock Exchange (DSE) and Central Depository Bangladesh Limited (CDBL) have jointly launched an online

platform to allow investors to easily transfer their shares from anywhere. The service "Online Transmission of Securities

and Lodging Complaints by the Clients of Suspended Stock-Broker" will be available on the CDBL website. Managing

Director and CEO of the CDBL said the launch of the online service, investors will now be able to transfer shares sitting

in their homes without any hassle.

BSEC asks firms to transfer funds by July 30

Bangladesh Securities and Exchange Commission on Tuesday asked all listed companies, brokerage houses and

merchant banks to transfer amounts held against unclaimed, undistributed or unsettled dividends or non-refunded

public subscription money in cash to the Capital Market Stabilisation Fund within July 30. BSEC issued a letter to be

distributed to all asset management companies, stockbrokers, merchant banks, and listed companies, including

companies operating in the over-the-counter market.

DSE gets new managing director

Bangladesh Securities Exchange Commission on Tuesday gave its nod to Hashkloud Bangladesh Limited executive

chairman Tarique Amin Bhuiyan as new managing director of the Dhaka Stock Exchange (DSE.) The BSEC made the

decision after the DSE sent three names for the position of managing director of the bourse on Monday.

UniCap Securities Limited Weekly Market Review

08 July 2021

Weekly News

Baraka Patenga IPO share allotment Monday

The initial public offering (IPO) shares of Baraka Patenga Power will be allotted by The Dhaka Stock Exchange formally

on Monday (5 July). The company completed its IPO subscription between 13 and 17 June this year.

BSEC gives nod to 2nd SME IPO

Bangladesh Securities and Exchange Commission (BSEC) has given its approval to Mostafa Metal Industries Ltd to be

listed as an SME in the stock market. The organization will raise funds for bank loan repayment, working capital and

issue management costs with a face value per share of Tk10 to investors. The issuer will not be able to issue any bonus

shares for the next three years from the date of transaction on the SME platform. NBL Capital & Equity Management

Limited and Swadesh Investment Management Limited will be working as the issue managers.

Robi subsidiary unveils Tk15cr private equity fund

RedDot Digital, a wholly-owned ICT focused subsidiary of Robi Axiata Limited, has unveiled a private equity fund to

promote digital entrepreneurship in the country. R-Ventures Private Equity Fund will be registered under the

Bangladesh Securities and Exchange Commission (BSEC) and the target fund size is BDT 15 crore, according to the

regulatory filing. RedDot Digital will act as the sponsor of the fund, while SBK Tech Ventures will play the role of the

General Partner or the Fund Manager. Green Delta Insurance Company, as trustee of the private equity fund, shall act

as the guardian of the fund while IDLC Investments Limited and ACNABIN shall perform the roles of valuer and auditor

respectively.

1.22 lakh BO accounts closed in June

Central Depository Bangladesh Limited (CDBL) closed around 1.22 lakh beneficiary owners' (BO) accounts in June as

the account holders did not renew them. On 31 May this year, the number of active BO accounts was 26.59 lakh,

which stood at 25.36 lakh at the end of June, according to the CDBL. Sources said investors who had more than one

BO accounts have not renewed them as they are not going to benefit by using them under the new system.

Fund raising through IPOs hits a decade high

Private companies have offloaded primary shares worth BDT 16.12bn in FY21, the highest amount in more than a

decade, amid virus-induced sluggish economic activities. With the latest one of Baraka Patenga Power, the country's

capital market witnessed 16 initial public offerings (IPOs) in FY21, boosting the market capitalisation significantly and

increasing the depth of the market. Battered by the Covid-19 pandemic, insiders said, the companies raised such

huge amount of funds on expectations that it might help stimulate their business strength in the post-pandemic period.

Most part of the funds is meant for business expansion, repayment of loans and meeting the working capital

requirements. The market also has seen the entry of the largest ever IPO - Robi Axiata-- during the outgoing fiscal year.

Six companies used the book-building method - Walton Hi-Tech Industries (Tk 1.0 billion), Energypac Power Generation

(Tk 1.50 billion), Mir Akther Hossain (Tk 1.25 billion), Lub-rref (Bangladesh) (Tk 1.50 billion), Index Agro Industries (Tk 500

million) and Baraka Patenga Power (Tk 2.25 billion). Ten other companies raised funds using fixed-price method - Robi

Axiata (Tk 5.23 billion), Dominage Steel Building Systems (Tk 300 million), Express Insurance (Tk 260.79 million), Associated

Oxygen (Tk 150 million), Crystal Insurance (Tk 160 million), Desh General Insurance (Tk 160 million), eGeneration (Tk 150

million), Taufika Foods and Agro Industries (Tk 300 million), NRB Commercial Bank (Tk 1.20 billion) and Sonali Life

Insurance (Tk 190 million). Dr AB Mirza Azizul Islam, a former adviser to the caretaker government, said making the

secondary market vibrant is one of the key factors needed to create scopes for the new companies to raise funds

through IPOs. Mr Islam, also a former chairman of BSEC, said the companies having good fundamentals and

reputation should be allowed to be listed to deepen the market. He also stressed the need for bringing state-owned

enterprises to further strengthen the market and make it efficient.

UniCap Securities Limited Weekly Market Review

08 July 2021

Weekly News

BSEC to appoint spl auditor to assess Unilever’s GSK purchase

Bangladesh Securities and Exchange Commission has decided to appoint special auditor to examine thoroughly the

acquisition of GlaxoSmithKline Bangladesh by Unilever Group. The BSEC made the decision at a commission meeting

held on June 24. On June 28, 2020, Unilever Overseas Holdings BV acquired 81.98 per cent share of GSK Bangladesh

from SETFIRST Limited UK, a special purpose vehicle of GSK UK, for BDT 2,020.45 crore. On July 2, 2020, the name of GSK

Bangladesh was changed to Unilever Consumer Care Limited. BSEC officials said that the auditor would look into

divestment of asset by GSK. It would also assess sales of asset under pharmaceutical unit that was shut down before

the acquisition by Unilever, the BSEC officials said. BSEC commissioner Shaikh Shamsuddin Ahmed told New Age that

the regulator decided to appoint special auditor to UCCL to be ensure that there were no irregularities occurred in the

transaction of shares acquisition by Unilever Group.

Baraka Patenga investors to get minimum 54 primary shares

Dhaka stock exchange (DSE) on Monday formally allocated the IPO shares of Baraka Patenga Power, under the

newly introduced pro-rata basis. According to the DSE, Baraka Patenga Power's IPO shares have been 4.67 times

oversubscribed by investors who submitted applications through the electronic subscription system (ESS). The stock

exchange has got 8,470 invalid applications involving Tk62.76 crore. Of the investors, ones who have applied for Tk10,

000 will get a minimum of 54 IPO shares of the company, while those who have applied for Tk20,000, Tk30,000, Tk40,000

and Tk50,000 will get 108, 162, 216 and 270 shares, respectively. Besides, affected investors will get a minimum of 98

shares and non-residential Bangladeshis (NRBs) will get a minimum of 128 shares of the company.

Southeast Bank 1st Mutual Fund gets BSEC nod for conversion into open-end

After the completion of its 10-year tenure, Southeast Bank 1st Mutual Fund has now got the nod from the securities

regulator for conversion into open-end form, as the unit holders have decided to run the fund instead of its liquidation.

The close-end fund completed its 10-year tenure on 15 May this year. More than 99% unit holders voted in favour of

the conversion proposal of the fund at a virtual meeting held on 25 May. In this context, the Bangladesh Securities and

Exchange Commission (BSEC) on 30 June approved the conversion of Southeast Bank 1st Mutual Fund from a closed-

end into open-end. VIPB Asset Management is the manager of the fund while the Investment Corporation of

Bangladesh (ICB) is acting as the custodian and the trustee.

BSEC okays PRAN’s Tk 150cr green bond

Bangladesh Securities and Exchange Commission on Wednesday allowed PRAN Agro Limited to float non-convertible

coupon bearing green bond worth BDT 150 crore. The face value of each unit of the bond is BDT 10 lakh. The coupon

rate of PRAN Agro’s bond is 9%. Only banks, financial institutions, insurance companies, listed banks, trust funds,

corporate institutions and other eligible investors will be allowed to purchase the bond through private placement.

PRAN Agro will utilise the bond proceeds in strengthening its capital and liquidity with keeping environmental balance.

Green Delta Insurance Company acts as trustee and Standard Chartered Bank is the arranger of the green bond.

Asheq becomes DSE’s CRO amid criticisms

Bangladesh Securities and Exchange Commission on Wednesday approved M Asheq Rahman as chief regulatory

officer of the Dhaka Stock Exchange despite criticisms. The BSEC on Wednesday sent a letter to the premier bourse

informing the matter.

Sri Lanka’s JAT Holdings to open IPO on 20 July

JAT Holdings, Sri Lanka's industry leader in finishing and furnishing, has recently announced that it will enter an Initial

Public Offering (IPO) on 20 July. Proceeds from the company's IPO will be used for the company's near term objectives

of investment in enhancing the existing R&D facility and setting up a manufacturing facility in Bangladesh. JAT

Holdings has successfully established a firm market presence as the leader in wood coatings in Sri Lanka and

Bangladesh.

UniCap Securities Limited Weekly Market Review

08 July 2021

Weekly News

Stock

HR Textile profit up 41% as exports rise

HR Textile Mills, a 100% export-oriented company, has posted a 41% increase in profit as its earnings from garment

exports rose in 9MFY21. It also posted a 116% increase in profit during 3QFY21. During 9MFY21, exports rose by 16% to

BDT 202.3 crore from BDT 174.74 crore in 9MFY20. The company exports knit fabrics and garments to Canada,

European Union and Asia. It saw a 44% drop in knit fabric exports but a 70% increase in garment exports. During

9MFY21, its earnings from knit fabrics stood at BDT 45.42 crore, which were BDT 82.29 crore in 9MFY20.

National Bank recommends 5% stock dividend

National Bank Limited recommended a 5% stock dividend for the shareholders for the 2020. According to the bank

sources, its consolidated EPS declined 12% YoY to BDT 1.18. In the January to March quarter of this year, its

consolidated earnings per share also dropped 57% to Tk0.13. During this period, the bank's NAV per share stood at BDT

17.08.

Japanese firm in talks to take over Emerald Oil

The securities regulator's effort to bring the dead horses of local bourses back into production is likely to work for

Emerald Oil Industries' shareholders as a Japanese firm already has joined its board of directors with an 8%

shareholding and in talks to get more. Minori Bangladesh Limited, a subsidiary of Japanese farming company Minori

Co Limited, is in talks to inject BDT 50 crore to help Emerald Oil turn around, said Professor Shibli Rubayat-Ul-Islam,

chairman of the Bangladesh Securities and Exchange Commission (BSEC). The founder of Emerald Oil fled the country

a few years back as he faced a corruption trial due to his scam in taking bank loans from BASIC Bank.

Usmania Glass to resume production after a year

The government's lone glass production facility Usmania Glass Sheet Factory Limited (UGSFL) is set to resume

commercial production on 10 July after a year as it has repaired and renovated two furnaces. According to the

Bangladesh Chemical Industries Corporation (BCIC), the UGSFL had two furnaces to make glass sheets. But in the face

of recurring losses, the first furnace was shut a couple of years ago and the second one got damaged in an accident

on 23 June 2020. With both furnaces down, the BCIC subsequently initiated their repair that cost BDT 3.0 crore. With

both furnaces on, the daily production of Usmania Glass was 40,000 square feet of glass sheets, leading to an annual

production of around 1.5 crore square feet.

Dacca Dyeing posts Tk4.09cr profit in Jul-Mar FY21

Home textile and terry towel maker Dacca Dyeing & Manufacturing Company posted BDT 4.09 crore profit in 9MFY21.

After a gap of four years, the company has published its FY20 annual financials and declared a 1% cash dividend. EPS

stood at BDT 0.47 in 9MFY21, which was BDT 0.03 in 9MFY20. The company began to lose money following the gas line

disconnection. In 2016, the company posted losses of nearly Tk29 crore, which increased to more than Tk34 crore in

the following year. In Oct’20, the company won a Supreme Court order to have its disconnected gas lines restored.

Westin Dhaka sees sharp fall in revenue in pandemic

Unique Hotel and Resorts Limited (UHRL), owner of The Westin Dhaka and a three-star hotel named Hansa, saw its

revenue continuing to dwindle because of poor guest occupancy. During 9MFY21, the company registered a 67%

decline in revenue to around BDT 50.0 crore in contrast to BDT 158 crore in FY20. In this situation, the managing director

of the UHRL, recently wrote to the National Board of Revenue (NBR) chairman, seeking an exemption from corporate

taxes and VAT for the next five years.

UniCap Securities Limited Weekly Market Review

08 July 2021

Weekly News

HC appoints 5 independent directors at Int’l Leasing

The High Court has appointed five independent directors to International Leasing and Financial Services for smoothly

running operations as it had incurred a loss of around BDT 3,000 crore. All the members of its present board of directors,

except for Chairman Nazrul Islam Khan who was appointed by the bench earlier, are accused in a number of criminal

cases and are fugitives in the eye of law. Among the newly inducted directors, Syed Abu Naser Bakhtear is the former

managing director and chief executive officer of Agrani Bank, Prime Bank and South East Bank. The others include Md

Shafiqul Islam, a retired senior district and sessions judge and a former ACC director, Brig Gen (retired) Md Meftaul

Karim, Barrister Md Ashraf Ali and Enamul Hasan, FCA. The HC also ordered Bangladesh Bank to do the needful to let

the board of directors form and run the NBFI as per the court's order.

FAS Finance’s new board to appoint auditor to find irregularities

A board member seeking anonymity said the new board of FAS Finance is working to save the company from

drowning and that is why it has decided to appoint an auditor to evaluate the current situation of the institution. He

said the auditor will review the financial statements, financial health, and financial performance, verify books and

accounts and assess loans, investment process and asset quality to identify anomalies, lapses, liabilities with banks,

financial institutions and others. The auditor will submit a report with several recommendations for further improvements

of the company, he added.

NRBC Bank crosses deposit milestone of Tk 100b

NRBC Bank has now become a bank with a deposit of BDT 100.0bn, said a press release. Despite the coronavirus

outbreak, the bank’s deposits stood at BDT 10,577 crore during 1HCY21, which was BDT 7,982 crore during 1HCY20. The

deposit growth was recorded at 32.52% YoY during the period.

BSEC forms body to check abnormal share transaction of Delta Life

Bangladesh Securities and Exchange Commission on Wednesday formed a three-member committee to inquire

about recent abnormal transactions of shares of Delta Life Insurance Company Limited. BSEC officials said that the

price of each share of Delta Life was BDT 103.3 on June 23 and the price shot up to BDT 154 on June 30 with

transactions of a significant volume of shares. The officials said that the state-run Investment Corporation of

Bangladesh sold huge shares of Delta Life in the market recently.

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This research report was prepared by UniCap Securities Ltd. (UNICAP), a company authorized to engage in securities activities in Bangladesh.

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