Beximco Pharma has a new MD

Aiming for strategic growth Amid leadership shift, Beximco Pharmaceuticals, appointed Iqbal Ahmed as new managing director. Iqbal Ahmed has been a long-serving director at the company.

The appointment of Iqbal Ahmed as managing director marks a significant milestone in Beximco Pharma's history. Ahmed, who has been an integral part of the company's board since 1985, steps into his new role, taking over from Nazmul Hasan, who resigned following his appointment as a government minister. The transition is poised to steer Beximco Pharma towards a new phase of growth and innovation, pending shareholders' approval at the forthcoming annual general meeting.

Having served on the board for nearly four decades, Ahmed brings a wealth of experience and a deep understanding of the pharmaceutical industry's dynamics. This leadership change comes at a critical time when the company is looking to bolster its market position and expand its global footprint. Under Ahmed's guidance, Beximco Pharma is expected to harness new opportunities and navigate challenges with renewed vigor and strategic acumen.

Stakeholders are keenly watching the leadership transition, anticipating its impact on the company's performance and strategic direction. Ahmed's appointment is viewed as a positive move, reflecting the company's commitment to continuity and stability. Investors, employees, and partners are optimistic that the new managing director's vision will translate into enhanced operational efficiency, innovation, and profitability. With the pharmaceutical industry facing rapid changes and increased competition, Ahmed's leadership is considered pivotal in driving Beximco Pharma's growth and sustainability.

The appointment of Iqbal Ahmed as the new managing director of Beximco Pharmaceuticals signifies more than a change in leadership; it heralds a strategic shift towards future readiness and growth. As the company navigates through the complexities of the global pharmaceutical landscape, Ahmed's seasoned leadership and strategic vision are anticipated to drive Beximco Pharma towards achieving its long-term objectives, ensuring its continued success in an ever-evolving industry.

A fixed income opportunity: Beximco Green Sukuk

Investors in Beximco Sukuk received a periodic payment of 5.55% during the initial half of 2023. This translates to an annual rate of 11.1% based on the face value of Tk100 per unit. In the capital market, an intriguing situation has emerged where return-seeking investors seem to be disregarding the attractive rates offered by the sole listed Sukuk, an Islamic debt instrument.

With an impressive yield of over 13%, Beximco Green-Sukuk AL Istisna'a has been found to be the most alluring fixed income option in the local financial market. In comparison, Treasury bonds presently offer a yield of up to 9%, while individuals are placing their funds in banks for returns ranging from 6% to 8%. National savings certificates provide an interest rate between 7.7% to 11.76% annually.

According to analysts, an investor who had purchased this Shariah-compliant instrument from the exchanges at the floor price of Tk85 per unit would achieve an effective annual yield exceeding 13%. Despite this, exchange trading of Beximco Sukuk barely reflects any appetite among mass investors.

For months, there has been a scarcity of trades involving this instrument, and the price has not risen above Tk86 in the past five months, as reported by the Dhaka Stock Exchange (DSE).

Beximco Sukuk investors are guaranteed to have a 9% base rate against the face value each year. On top of that, the Sukuk offers added payments if Beximco's cash dividend for the year is higher than 9%. According to the Sukuk prospectus, one-tenth of the percentage point excess Beximco Ltd shareholders get as cash dividends over the Sukuk base rate would be added to the Sukuk payment rate. For example, Beximco's dividend was 30% for the last fiscal year and Sukuk investors' are getting periodical payments at 11.1% rate. 210 basis points added to the base rate of 9%.

If Beximco Limited shareholders get higher dividends, Sukuk investor's return will go higher and if Beximco's dividend rate is less than 9%, Sukuk investors will get periodical payments at 9%, still not less than the highest yield from the treasury bonds, and bank deposits nowadays. Fixed income investments have been popular among institutional investors in the country as they have informed investment professionals within teams.

However, there has been a significant lack of awareness and appetite among the retail investors, which is why the bond market has been a playground of institutional investors, while the equity market is mostly chased by individuals.

Of the 17.45 lakh beneficiary owner accounts in Bangladesh now, not even 17,000 are by institutional investors, according to the Central Depository Bangladesh. Floor price hurts confidence during equity conversion. Besides, the secondary market investors also seem to have been ignoring the lucrative option to convert the debt into the equity of Beximco Ltd that should have been only increasing the appeal of the Sukuk as Beximco offered the gradual conversion at 25% discount on the 20-day average market price of Beximco shares.

For instance, Sukuk investors who exercised their right to convert 20% of the Sukuk in Beximco equity at the end of 2022 – the first year of the five year instrument, their cost for a Beximco share was Tk86.70, while the stock has been stuck at the floor price of Tk116. Even if one, getting Sukuk converted into equity last year, had sold at a 10% discount from the floor in the block market, it was still an over 15% capital gain. Not even 20% of the eligible Sukuk investors applied for the conversion last year.

Analysts observed that the floor price deprived investors of liquidity and hurt their confidence. The floor price imposed by the Bangladesh Securities and Exchange Commission (BSEC) at the end of July last year to artificially hold prices of listed securities despite the economic challenges brought about by the Ukraine war.

Teesta Solar Ltd comes into operation

Prime Minister Sheikh Hasina inaugurated a 200-megawatt  solar power plant, the highest renewable resource-focused power generation capacity of a single facility in the country, built by Beximco Power Ltd.

Some $300 million was invested to set up the plant, named Teesta Solar Ltd, on 650 acres of a landmass formed through sedimentation in Sundarganj upazila of the northwestern district of Gaibandha, said a press statement.

The plant is expected to provide 200MW of electricity to the national grid daily, said the statement issued by Public Relations Officer Shafiqul Islam of the office of the adviser to the prime minister on private industries and investment.

The prime minister inaugurated the plant, which started trial operations from December last year, from a gathering on Rangpur Zilla School premises.

"We think this renewable energy sector will be very important for the future," said Shayan F Rahman, chairman of Beximco Power Limited. He further said they launched the first sukuk bond of the private sector in the country to finance this project.

A sukuk is an Islamic financial certificate, similar to a treasury bond and structured to generate returns in compliance with Islamic finance principles. "In the future we are thinking of setting up more solar power plants as per government plans," he noted.

Shops in Dhaka which are at risk of fire and accidents will be closed

Prime Minister’s Private Industry and Investment Adviser Salman F Rahman said that after Eid, some shops in Dhaka which are at risk of fire and accidents will be closed. According to a related source, the government is going to be strict against the markets, hospitals and buildings that are at risk of fire after Eid. The fire-prone building is currently under intelligence surveillance.  Salman F Rahman said, “We consider one or two shops unsafe and accidents can happen there.” We have to take strict action against them. Although Salman F. Rahman gave a message of strict action on behalf of the government, he did not name any market that will be closed.

 

Most of the buildings in the capital Dhaka have been constructed without fully complying with the fire service and civil defense instructions. There is no fire alarm system in these buildings. There is no adequate water and firefighting system. There are enough stairs but they are not open. Shops-warehouses have also been placed on stairs in commercial buildings. Even in the vicinity of the market-shopping mall building, there are hanging electrical cables and AC equipment connections. Altogether, 55 percent of Dhaka’s buildings are at risk. This information is available by reviewing a recently published fire service report. The report was prepared by inspecting various aspects of fire safety of buildings across the country from January 1 to December 31, 2022.

 

Recently, the dangerous market like Bangabazar in the capital was declared dangerous on April 10, 2019, but the building owners or businessmen did not pay attention to the notice of the fire service because they did not have the power to take punitive measures. And due to legal weakness, the organization could not take effective action against them. In the last few days, several big fires have shaken all quarters.

 

The fire service and civil defense have listed markets, shopping malls, hospitals, commercial and residential buildings in the capital that are at risk of fire. The list includes 1,305 markets and buildings including Gauchia Market, Noor Mansion, Rajdhani Super Market, Karwan Bazar Kitchen Market, Lily Plaza, Dhanmondi Hawkers Market. Of these, 450 buildings have been identified as high-risk. And there are more than four hundred hospitals including Dhaka Medical and Suhrawardy in this list.

 

The fire service has started sending warnings to these market authorities and building owners. All the owners of these buildings will receive warnings or notices, according to fire service sources. According to the fire service report, 24,102 fire incidents occurred in the country in 2022. 98 people were killed and 407 people were injured in these accidents. Among the dead are 13 fire service officials. According to the report, Tk 342.59 crore has been caused by fire in the year 2022. And the estimated value of recovered goods is Tk 1,808.32 crore. Besides, 9,517 fires were brought under control before going into operation.

 

The fire service inspected 5,869 buildings to prepare the report. It identifies 2,223 buildings as dangerous. Among them, there are 671 high-risk buildings and 1,606 vulnerable buildings. At the same time, satisfactory results are obtained in 3 thousand 96 buildings in fire safety. Dhaka has the highest number of 54.67 percent buildings and Mymensingh has the lowest number of 1.93 percent buildings under fire risk. 54.29 percent of buildings in Chittagong are at risk of fire. Besides, 29.62 percent in Barisal, 41.46 percent in Khulna, 24 percent in Rangpur, 19.76 percent in Sylhet, 14.97 percent in Rajshahi and 1.93 percent in Mymensingh are under fire risk.

Beximco acquires 5.25% stake at Shipping Corporation

Beximco Ltd has decided to ask for a directorship at the Bangladesh Shipping Corporation as the conglomerate acquired a 5.25% stake in the state-owned shipping line. The decision came at a Beximco board meeting.

Beximco earned revenue of Tk1,919 crore in the July-September quarter this year, which was Tk1,758 crore a year ago. However, because of increased costs including that of production, administration, distribution and finance, the company's net profit for the three months dropped to Tk369 crore, from Tk450 crore in the same quarter last year.

Quarterly earnings per share (EPS) stood at Tk3.83 this year, which was Tk4.11 a year ago.Beximco shares having a face value of Tk10 each closed at the floor price of Tk115.6 in the Dhaka Stock Exchange. Beximco Pharmaceuticals Ltd, the drag-making arm of Beximco Group, has seen its quarterly revenue grow to Tk979 crore, from Tk847 crore a year ago. But, rising costs reduced its EPS to Tk3.24 in the July-September quarter from Tk3.28 for the same period last year. The group's ceramic exporting wing Shinepukur Ceramics, on the other hand, secured a quarterly EPS of Tk0.10 each in the July-September quarter, which was Tk0.02 a year ago, while its quarterly turnover increased to over Tk49 crore from Tk36.4 crore in the previous year.

Salman F Rahman: Bangladesh gives advice on labor rights their due importance

PM's Adviser for Private Industry and Investment Salman F Rahman details steps government has taken to develop labor sector

Bangladesh considers the recommendations of the United States of America, European Union and the International Labor Organization (ILO) on labor rights with due importance, said Prime Minister's Adviser for Private Industry and Investment Salman F Rahman.

Speaking at the virtual meeting of the US-Bangladesh labor working group on Thursday, Rahman detailed the steps taken by the current government in the labor sector. The Prime Minister's Adviser for Private Industry and Investment and US Under Secretary for Economic Growth, Energy, and the Environment Jose W Fernandez led the Bangladesh and US delegations respectively at the inaugural meeting of the working group.

US team leader Fernandez praised the steps taken to develop the labor sector in Bangladesh and called for the full implementation of the recommendations of the International Labor Organization, said the Ministry of Foreign Affairs.

He pledged to provide necessary cooperation and work together for the further development of the labor sector of Bangladesh. Bangladesh and the US discussed "collaboration and assistance" to Bangladesh as it takes further steps to implement the requirements developed by Bangladesh for its International Labor Organization roadmap and adhere to internationally recognized labor rights.

The objective of the meeting was to support Bangladeshi implementation of commitments to improve labor rights protections and to further economic cooperation between the US and Bangladesh, according to the office of the Spokesperson, US Department of State.

Secretary to the Ministry of Labor and Employment Md Ehsan-E-Elahi, Bangladesh Ambassador to the United States Muhammad Imran, BIDA Executive Chairman Lokman Hossain Miah, Executive Chairman of BEZA Shaikh Yusuf Harun, Executive Chairman of BEPZA Major General Abul Kalam Mohammad Ziaur Rahman, US Ambassador to Bangladesh Peter Haas and high-level representatives from relevant departments joined the meeting.

On the other hand, the US delegation presented its observations on the revision of labor laws and regulations and the registration of trade unions. The representative of the Ministry of Commerce urged the US side to seriously consider the issue of providing duty-free facilities to Bangladeshi products in the United States.

Beximco Ltd finalised €32.5 million expansion plan

Bangladeshi conglomerate Beximco Ltd has finalised a €32.5 million expansion plan for its Knit Fabric Facility ING Bank and Germany's ECA-Euler Hermes are funding the project which is expected to fosters the expansion and upgrading of its vertically integrated Textile Manufacturing Plant. The loan agreement was signed by Anil Kumar Maheshwari, COO, on behalf of Beximco Ltd and Lukas Strauch, director and B Ponsioen, MD on behalf of ING Bank.

This milestone that furthered Beximco's international presence, actualised the import of advanced German and other textile equipment through a German exporter; sourcing competitive equipment financing from ING Bank, with an insurance-backed cover from Germany's Export Credit Agency (ECA).

The deal has aggregated 38 equipment suppliers in a single export contract through their international strategic financial advisor – M/s Blend Financial Services Ltd. On successful financial closure of this Euler Hermes backed transaction, Beximco's Group Director & CEO, Syed Naved Husain said, "This was a very distinctive transaction for us, and it has opened up various avenues for Beximco for its future expansion and growth plans and for the Bangladeshi Textile Industry as a whole towards international financing propelling its global presence to new heights."

Referencing the conglomerate's milestone, Vaibhavi Thakkar, co-founder, and CEO of Blend Financial Services Ltd said, "As a Co-founder & CEO of Blend, we are ecstatic to partner with Beximco in their growth journey that is committed to provide high quality products without compromising its sustainability goals and promoting Bangladesh on an international platform." Blend is well positioned to provide be-spoke solutions by rallying through its network across all the stakeholders, basis the requirement of the company. In this landmark transaction, Blend has cemented its position as an "Environment Conscious Global Advisor" wherein we partner with our clientele by providing a solution that are aligned to its goals & strategy, she further said.