The board of directors of KDS Accessories, a unit of Chattogram-based KDS Group, has decided to invest Tk 144.50 million (estimated) for finishing line automation to meet growing demand.
The said amount will be used for procuring machineries and civil construction for finishing line automation of corrugated packaging which will increase the ability to maximise the total capacity utilisation with a variety of printing breakdown and product sizes, the company said in a disclosure to the Dhaka Stock Exchange (DSE) on Wednesday.
After automation, the overall capacity utilisation can be increased by 15 per cent from the existing ones. An additional 3,000,000 pieces carton box per year can be finished upon having order, the company said in the disclosure.
"It may generate approximate additional sales revenue of Tk 250 million annually," said the company.
This project will be financed through combination of bank loan and company's own source, according to the disclosure.
Following the investment news, KDS share price jumped 4.52 per cent to close at Tk 53.20 each on Wednesday at the Dhaka bourse.
Each share of the company, which was listed on the DSE in 2015, traded between Tk 33 and Tk 57.60 in the last year.
Meanwhile, the board of directors of the KDS Accessories has recommended 7.50 per cent cash and 7.50 per cent stock dividend for the year ended on June 30, 2020, another disclosure said on Wednesday.
The annual general meeting (AGM) will be held on November 19 at 11:00am through digital platform. The record date is on November 4.
The company's net profit after tax increased 4.50 per cent year-on-year to Tk 144.68 million for the year ended on June 30, 2020 despite ongoing pandemic.
The company has also reported earnings per share (EPS) of Tk 2.18, net asset value (NAV) per share of Tk 24.99 and net operating cash flow per share (NOCFPS) of Tk 8.12 for the year ended on June 30, 2020 as against Tk 2.09, Tk 24.94 and Tk 2.02 respectively for the same period of the previous year.
The company disbursed 10 per cent cash and 5.0 per cent stock dividend for the year ended on June 30, 2019.
The company's paid-up capital is Tk 662.16 million and authorised capital is Tk 2.0 billion while total number of securities is 66.21 million.
The sponsor-directors own 76.15 per cent stake in the company, while the institutional investors own 4.66 per cent, and the general public 19.19 per cent as on September 30, 2020, the DSE data show.
KDS Group started its operations in 1983 and engaged in various sectors such as garment, accessories, steel, logistics, bank, insurance, IT and shipping. The company has become one of the biggest business conglomerates, which employs more than 20,000 people.
KDS Accessories is the largest garments accessories producing company in Bangladesh which offers one of the most comprehensive ranges of apparel trims & packaging products and services. KDS now have two plants in strategic locations in Bangladesh making it accessible to the industry geographically.
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