The securities regulator has rejected a proposal of Baraka Power to raise its authorised capital through issuance of preference shares.
The company has failed to comply with the mandatory minimum shareholding rules of the Bangladesh Securities and Exchange Commission (BSEC).
The company said in a statement on Tuesday that the BSEC declined to approve the anticipated increase of the authorised capital through issuance of preference shares due to failure in holding 30 per cent shares jointly by the sponsor-directors.
Following the bearish market trend, the BSEC issued a notification on November 22 in 2011, saying that the sponsors, directors and promoters of a company listed with the stock exchanges will have to jointly hold at least 30 per cent stake in the firm for all time.
If the sponsors/promoters and directors of any listed company fail to hold the amount of shares, the respective company would not be able to declare rights share and raise capital through repeat public offer, it said.
Baraka Power's sponsor-directors own only 18.93 per cent stake in the company as on April 30, 2018 while the institutional investors own 24.93 per cent and the general public 56.14 per cent.
The company's paid-up capital is Tk 2.0 billion and authorised capital is Tk 3.0 billion while the total number of securities is 200.05 million.
The power generation company, which was listed with the Dhaka bourse in 2011, disbursed 5.0 per cent cash and 15 per cent stock dividend for the year ended on June 30, 2017.
Each share of the company closed at Tk 27.70 on Tuesday at the Dhaka bourse, remaining unchanged over the previous day.
On October 31, 2017, the board of directors of the Baraka Power had applied for increasing the authorised capital of the company from Tk 3.0 billion to Tk 4.0 billion.
The board had also decided to issue 80 million non-listed, non-convertible, cumulative, redeemable preference shares of Tk 10 each amounting Tk 800 million through private placement for meeting up financing needs of the company.
The company's consolidated earnings per share (EPS) stood at Tk 0.36 for January-March 2018 as against Tk 0.71 for January-March 2017.
In nine months for July 2017-March 2018, its consolidated EPS was Tk 1.51 as against Tk 2.13 for July 2016-March 2017.
The company's consolidated net operating cash flow per share (NOCFPS) was Tk 3.78 for July 2017-March 2018 as against Tk 4.56 for July 2016-March 2017.
The consolidated net asset value (NAV) per share was Tk 18.57 as on March 31, 2018 and Tk. 20.12 as on June 30, 2017.
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