Singer Bangladesh's stock surged 2.31 per cent to Tk 84.2 per share on Monday despite its recent disclosure of a hefty annual loss in 2025 on the back of soaring finance costs.
The multinational electronics and home appliance manufacturer reported a loss of Tk 2.25 billion for 2025, up from a loss of Tk 490 million in the previous year.
Due to heavy losses, the company declared no dividend for the first time in 2025.
The negative earnings reduced the company's net asset value to about one-fifteenth - Tk 168 million - of what it was in the previous year.
The company explained that the net asset value declined sharply due to a significant increase in both short-term and long-term debts taken for new manufacturing facilities. Short-term borrowings escalated alongside a hike in interest rates.
Singer has long-term debts of Tk 6.51 billion for its new manufacturing plant and Tk 13.94 billion in short-term borrowings to meet working capital requirements.
It said the loans it had taken funded the construction of its new manufacturing plant at the Bangladesh Special Economic Zone (BSEZ), a strategic move expected to triple its production capacity to achieve a cost advantage.
The boost in production will improve the company's profitability, which is anticipated to become visible in the coming years, said the company in its earnings note.
Interest expenses on borrowing jumped by 138.3 per cent year-on-year in 2025. "This increase is mainly due to interest on long-term loans (foreign loan and syndicated loan)."
As a result, the company reported a loss of Tk 22.56 per share in 2025, increased from a loss of Tk 4.91 per share in the previous year.
"This loss was primarily driven by a 124.7 per cent increase in financing costs, mainly due to higher interest rates, financing stretched working capital, lower demand actualisation compared to expectations, and exchange losses," said the company.
The taka has been devalued against the euro by 8 per cent since March 2025. "This has also significantly increased finance costs and is reflected as an exchange loss."
Additionally, growth in operating expenses and sales costs surpassed revenue growth. Though turnover increased by 14.3 per cent in 2025, the gross profit (GP) margin decreased by 2.3 per cent compared to 2024.
The company said selling prices could not be increased to remain competitive, which caused losses.
"The expense growth was driven by increases in salaries and allowances, warranty expenses, bad debts, repairs and maintenance, and depreciation of the new factory."
Meanwhile, Singer started commercial operation of the new plant in March last year, bolstering its foothold in the fast-growing market.
The plant is the flagship project within the Bangladesh Special Economic Zone at Araihazar in Narayanganj.
Spanning 135,000 square metres, the new plant is designed to manufacture 90 per cent of Singer products locally, including refrigerators, televisions, washing machines, and air conditioners, for the local market.
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