RSRM to raise Tk 200m from stock mkt
Tuesday, 13 July 2010
Jasim Uddin Haroon
Ratanpur Steel Re-rolling Mills (RSRM), the country's second largest rod manufacturer, is planning to go public, its chairman M Rahman told the FE.
"We've taken move to raise our paid-up capital worth Tk 200 million later this year," M Rahman said in an exclusive interview.
He said that a company has already been appointed to re-assess its assets.
"We'll float IPO through newly introduced book building method, subject to the approval of Securities and Exchange Commission (SEC)."
Mr Rahman said his company will increase its production capacity by around 50 per cent by investing the money raised from the stock market.
Currently, RSRM produces 200,000 tonnes rod per annum, around one tenth of the country's total consumption.
"We want to raise our production capacity 100,000 tonnes more," Mr Rahman, who is familiar to the steels and related products for more than 40 years.
Ratanpur chief said his steel products are being manufactured considering the country's mild to heavy earth-quake zones.
Mr Rahman said his company will purchase a mother vessel from the money to be raised from the stock market along with increasing other logistics supports for the fast growing rod company.
The company began its quest in producing mild-steel rod (MS) since 1984.
The Chittagong-based RSRM produces rods from a state-of-the-art plant by using its own billet from manufactured another plant - Modern Steels Ltd.-located at Baizid area in the port city.
"We use imported quality scraps for manufacturing billets and subsequently MS rods," said Mr Rahman: "We also use ship scraps from my ship yards."
Mr Rahman is known as one of the oldest ship breakers in Sitakunda area in the port city claming: "My ship breaking yards is also prepared considering the maximum welfare for the workers."
Brushing aside price wars by some new rod players he said: "Steel business needs traditions to maintain a steady state growth."
RSRM chief said Bangladesh don't have mines for iron ores and it produces rods by imported raw materials so that none can sustain by incurring losses in the long run.
Currently there are around 10 quality rod manufacturers in the country with market leader BSRM.
RSRM produces mainly 60-grade rod out of around 200 re-rolling mills in Chittagong, Dhaka and Naraynaganj.
RSRM turned its plant into an automatic mills in 2007, hinted that his company is now negotiating with overseas buyers to export rods to the south-east Asian countries.
"A number of buyers are now negotiating with us, and we expect to export rods shortly," Rahman added.
He said seven sisters of neighbouring India might be a good and reliable destination for the country's export of surplus rods.
Mr Rahman said Bangladesh's rod is cheaper than that of India.
RSRM chief said: "We need government supports to launch formal steel trades with north-eastern states of India."
Rahman is, however, critical of the country's nagging power and gas situation saying: "It is not only a barrier for us, it is emerging as great threat for other sectors."
RSRM said it is negotiating with the government to install a large power plant in the power-starved country.
RSRM has employed over 1200 workers with a good compensation package.
Apart from steel business, RSRM has ventures of real estate and trading.
Ratanpur Steel Re-rolling Mills (RSRM), the country's second largest rod manufacturer, is planning to go public, its chairman M Rahman told the FE.
"We've taken move to raise our paid-up capital worth Tk 200 million later this year," M Rahman said in an exclusive interview.
He said that a company has already been appointed to re-assess its assets.
"We'll float IPO through newly introduced book building method, subject to the approval of Securities and Exchange Commission (SEC)."
Mr Rahman said his company will increase its production capacity by around 50 per cent by investing the money raised from the stock market.
Currently, RSRM produces 200,000 tonnes rod per annum, around one tenth of the country's total consumption.
"We want to raise our production capacity 100,000 tonnes more," Mr Rahman, who is familiar to the steels and related products for more than 40 years.
Ratanpur chief said his steel products are being manufactured considering the country's mild to heavy earth-quake zones.
Mr Rahman said his company will purchase a mother vessel from the money to be raised from the stock market along with increasing other logistics supports for the fast growing rod company.
The company began its quest in producing mild-steel rod (MS) since 1984.
The Chittagong-based RSRM produces rods from a state-of-the-art plant by using its own billet from manufactured another plant - Modern Steels Ltd.-located at Baizid area in the port city.
"We use imported quality scraps for manufacturing billets and subsequently MS rods," said Mr Rahman: "We also use ship scraps from my ship yards."
Mr Rahman is known as one of the oldest ship breakers in Sitakunda area in the port city claming: "My ship breaking yards is also prepared considering the maximum welfare for the workers."
Brushing aside price wars by some new rod players he said: "Steel business needs traditions to maintain a steady state growth."
RSRM chief said Bangladesh don't have mines for iron ores and it produces rods by imported raw materials so that none can sustain by incurring losses in the long run.
Currently there are around 10 quality rod manufacturers in the country with market leader BSRM.
RSRM produces mainly 60-grade rod out of around 200 re-rolling mills in Chittagong, Dhaka and Naraynaganj.
RSRM turned its plant into an automatic mills in 2007, hinted that his company is now negotiating with overseas buyers to export rods to the south-east Asian countries.
"A number of buyers are now negotiating with us, and we expect to export rods shortly," Rahman added.
He said seven sisters of neighbouring India might be a good and reliable destination for the country's export of surplus rods.
Mr Rahman said Bangladesh's rod is cheaper than that of India.
RSRM chief said: "We need government supports to launch formal steel trades with north-eastern states of India."
Rahman is, however, critical of the country's nagging power and gas situation saying: "It is not only a barrier for us, it is emerging as great threat for other sectors."
RSRM said it is negotiating with the government to install a large power plant in the power-starved country.
RSRM has employed over 1200 workers with a good compensation package.
Apart from steel business, RSRM has ventures of real estate and trading.