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BSEC approves IPO of Coppertech

It extends suspension period of directive on margin accounts

FE Report | December 27, 2018 00:00:00

The securities regulator has approved the IPO (initial public offering) proposal of Coppertech Industries.

The company will raise a capital worth Tk 200 million offloading 20 million shares under the fixed price method.

The approval came on Wednesday at a meeting held at the office of the Bangladesh Securities and Exchange Commission (BSEC).

The company will utilise the IPO fund to purchase plant and machineries, repay bank loans, and construct building.

As per the financial statement for the year ended on June 30, 2018 the company's net asset value (NAV) per share, without revaluation, was Tk 12.06.

For the same period, the earnings per share (NAV) of the Coppertech Industries was Tk 2.60, whereas the diluted EPS was Tk 1.03. The weighted average EPS was Tk 0.87.

The core markets for the product of the company are power plants, AC fridge manufacturing factory and workshop, engineering workshop, electronic product producer and other local customers, according to IPO prospectus.

At Wednesday's meeting, the securities regulator extended the suspension period of its previous directive regarding transactions in margin accounts by two years.

As per section 3(5) of the Margin Rules, 1999 a member of the stock exchange shall not permit any new transactions in the margin account unless the resulting equity in the account would be not less than 150 per cent of the debit balance.

The securities regulator suspended the effectiveness of that section of the margin rules on August 17, 2017.

On Wednesday, the BSEC again extended the suspension period by two years.

The BSEC officials said the suspension period has been extended following a plea of the DSE Brokers Association of Bangladesh (DBA).

"The interest of investors and capital market has also been taken into account while extending the suspension period of the effectiveness of the section of margin rules," the BSEC said.

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