Despite a challenging year, Sikder Insurance Company Ltd has posted a 10 per cent growth in profit in 2023, backed by higher investment income from bank deposits and government securities.
The general insurer reported a net profit of Tk 53.6 million in the year 2023, as against Tk 48.8 million in the year before.
Subsequently, the company's earnings per share (EPS) stood at Tk 1.34 in 2023, up from Tk 1.22 in 2022, according to price sensitive information published on Thursday.
Despite the higher profit, the board of directors of the company recommended only 3 per cent cash dividend for 2023.
Despite the challenging macrocosmic scenario, the company managed to achieve profit growth due mainly to higher gross premium income and higher income from the investments in the government securities, said an official of the company, requesting not to be named.
Apart from higher gross premium income, the company got to avail a tax benefit because of stock market listing, which helped it to post higher profits, he added.
Presently, the listed companies that offload more than 10 per cent shares are paying 20 per cent corporate tax while non-listed companies have to pay 27.50 per cent.
However, the company is yet to disclose the detailed annual financial statements for 2023.
Sikder Insurance, which got listed in January this year, carries all kinds of non-life insurance business such as fire, marine and miscellaneous insurances.
Sikder Insurance raised Tk 160 million from the stock market under the fixed-price method.
The general insurer said it will utilise the IPO funds for investing in fixed deposit receipts (FDR) of Tk 40 million, investment in capital market of Tk 48 million, floor purchase of Tk 60.87 million and the rest for bearing the IPO expenses.
Currently, the company's paid-up capital is Tk 400 million and authorised capital is Tk 500 million, while the total number of shares is 40 million.
Currently, 58 insurance companies -- 44 general and 14 life insurers -- are listed on the stock market.
A strong dollar and runaway inflation continued to hit the businesses of overall general insurers, dragging down profits of most of them in 2023, compared to the year before.
Almost all business activities in the country remained sluggish in 2023, owing to lingering macroeconomic uncertainties, which in turn reduced general insurers' scope of earnings, say industry insiders.
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