Techno Drugs bidding begins April 21 to decide cut-off price

The bidding for eligible investors (EIs) to explore the cut-off price of IPO shares of Techno Drugs will begin on April 21, aiming to raise Tk 1 billion from the primary market.
The bidding, a requirement for going public under the book-building method, will continue until 4:00pm on April 24, according to a stock exchange filing on Monday.
After the cut-off price is determined, general investors, including non-resident Bangladeshis, will get IPO shares at a 30 per cent discount on that.
The price at which a company issues its shares to institutional investors through electronic bidding in an IPO is the cut-off price.
The valuation report submission for eligible investors through electronic subscription system (ESS) of the exchanges will start at 10:00am on April 25 to end at the same time on April 28.
Each eligible (EI) investor, who intends to submit an application, should maintain a minimum investment of Tk 30 million at the market price in matured listed securities, while the amount would have to be Tk 15 million for pension funds, recognised provident funds and gratuity funds as of April 8.
The minimum bidding value shall be Tk 2 million.
The Central Depository Bangladesh shall send a report to the stock exchanges regarding holdings of EIs in listed securities and the exchange shall ensure the compliance in this regard.
Techno Drugs received regulatory approval from the Bangladesh Securities and Exchange Commission (BSEC) on March 7 for raising the said amount.
With the IPO proceeds, the drug maker will purchase new machinery at an expense of Tk 270 million, expand its existing factory in Narsingdi at Tk 250 million, repay Tk 300 million against bank loans and build a new production unit in Gazipur at Tk 150 million. The remaining Tk 30 million is set aside for IPO expenses.
Imperial Capital and EBL Investments are acting as issue manager of the company's IPO process.
Techno Drugs' sales dropped 45 per cent year-on-year to Tk 2.73 billion in FY23 while profit plunged 59 per cent to Tk 195.5 million.
Accordingly, the earnings per share stood at Tk 2.08 for FY23, down from Tk 5.10 a year ago. Its net asset value per share with a revaluation surplus was Tk 27.78 while the asset value stands at Tk 22.57 per share without the revaluation surplus as of June 2023.
Techno Drugs will not be able to declare dividends before the listing, according to the regulator.
Established in 2009, the drug maker produces human and veterinary medicines and sells them both at home and abroad.
Techno Drugs also claims that it pioneered the production of oncology medicines in Bangladesh.

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