Beximco's halted production triggers raw material sales to cope with losses

DSE data shows the company has counted a loss of Tk 3.78 per share over the past six months

Beximco Limited, stuck at the floor price in the stock market, has posted losses for the past six months, nearly matching last year’s figures.

Between July and December, the company suffered a loss of Tk 365.5 million.

In the fiscal year 2023-24, the loss stood at Tk 358.7 million.

However, in the year before, the company had reported a profit of Tk 7.1 billion.

The company was still profitable in the March quarter last year, but the final financial report for June showed a loss.

Despite the downturn, Beximco distributed a 5 percent bonus dividend to investors.

Dhaka Stock Exchange, or DSE, data shows that the company still had Tk 75.93 billion in reserves at the time.

DSE’s latest data shows that in the past six months, Beximco has incurred a loss of Tk 3.78 per share.

In the same period last year, the company made a profit of Tk 0.82 per share.

Beximco's total shares, as per DSE data, number 943.2 million. Accordingly, the total loss for the six-month period amounts to Tk 365.5 million.

In the last quarter (October-December), the company suffered a loss of Tk 2.58 per share.

In the previous quarter, it had posted a profit of Tk 0.03 per share.

Since the ouster of the Awami League government, Beximco Group companies have been in turmoil.

The group has shut down 16 factories at Beximco Industrial Park due to worker unrest.

The group’s Vice Chairman Salman F Rahman served as deposed prime minister Sheikh Hasina’s advisor on private industry and investment.

He was arrested following the fall of the Hasina government in the face of a student-led mass uprising.

Interim government’s investigation committee, formed with advisors, found that although Beximco Industrial Park had announced the existence of 32 factories, only 16 were operational.

Loans amounting to Tk 120 billion were taken out in the names of these 16 non-existent factories.

Overall, Beximco borrowed a total of Tk 290.93 billion from different banks and financial institutions under the names of 32 companies.

Among these 16, 11 were textile and garment companies, which had declared layoffs as of Jan 31. The factories have yet to reopen.

Beximco Pharmaceuticals Limited and Shinepukur Ceramics, both listed on the stock market, have not been officially shut down.

Regarding the company’s losses, Beximco said on the DSE’s website that no bank had opened letters of credit, or LC, in Beximco Limited’s name since August.

Production at the factories remained largely suspended between July and December.

Without the support of any bank, Beximco could not maintain production.

Moreover, raw materials, including yarn and fabrics, were sold at a loss, below their purchase price, due to the inability to utilise them for production.

Mohammad Asad Ullah, company secretary at the Beximco Limited, told bdnews24.com: “The company is not in production. If products cannot be sold, there will be losses.”