Beximco’s sukuk bonds gain on debut

Bangladesh started the trading of the Beximco Green Sukuk Al Istisna'a bonds, a Shariah-compliant debt instrument and the first of its kind, on Thursday.

Published : 13 Jan 2022, 11:19 AM
Updated : 13 Jan 2022, 11:19 AM

The face value or offer price was fixed at Tk 100 per bond, which gained as much as 10% in an hour after DSE opened trade, before it closed at Tk 101 on the Dhaka Stock Exchange.

A sukuk is a bond that conforms to Islamic strictures on the prohibition of charging or paying interest. The biggest offer by any private company in Bangladesh, the Beximco sukuk bonds are secured. Investors can turn their bonds into shares, or take profit semi-annually over a term of five years.

The bond originated by Beximco Ltd has been categorised as a corporate bond of the DSE under the N category and has the trading code ‘BEXGSUKUK.’

The prime minister’s Industries and Investment Adviser Salman F Rahman inaugurated the bond trading at the DSE on Thursday. Bangladesh Securities and Exchange Commission Chairman Prof Shibli Rubayat-Ul-Islam was present as a special guest.

Market regulator BSEC approved Beximco Limited's sukuk in June 2021.

As much as Tk 7.5 billion of the sukuk was planned for sale to current shareholders, another Tk 7.5 billion through initial public offering and the rest to other investors.

The application was submitted on Aug 16 last year and the deadline was extended twice to Sept 30 as the bond failed to draw sufficient investment, leading to fears over the possible cancellation of the sukuk bond.

The deadline was further extended to Dec 21 and finally, bonds worth Tk 30 billion were sold.

Bonds worth a total of Tk 24.4 billion were sold under the private placement, while retail buyers bought bonds worth Tk 4.23 billion. Current shareholders bought bonds worth Tk 20 million. Sukuk bonds worth at least 1.35 billion were bought by the underwriters.

The trading then started on Thursday.

Beximco took the decision to release the bonds as part of a push to mobilise funds for the solar power projects of Teesta Solar and Korotoa Solar, the subsidiaries of Beximco Power Company Ltd.

The proceeds from the sukuk, maturing in five years, will also be used to finance the machinery and equipment required for the expansion of Beximco's textile division.

Toufique Imrose Khalidi
Editor-in-Chief and Publisher