Krishibid Seed files for QIO with small-cap Board
KEY FINANCIALS
- The company will raise Tk18cr for business expansion
- Tk1.06 crore net profit
- Sales revenue was Tk18.99 crore
- EPS stood at Tk4.71
- 10% per annum growth
- Tk2,350cr market volume in FY19
Krishibid Seed Limited has recently applied to Bangladesh Securities and Exchange Commission (BSEC) for Qualified Investors Offer (QIO) to raise Tk18 crore from the small capital board of the capital market through fixed price method for its business expansion.
Earlier, three companies filed applications for QIO with the commission, but two of them later withdrew their request while another was rejected by the regulator.
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Issue managers are not interested in bringing small capital companies to the market as they pay low fees, according to sources.
They said rules for small capital companies should be short and simple. Small entrepreneurs are not as much capable as the listed companies to comply with all the rules.
However, the stock exchanges are now ready to start trading activities in the Small Capital Board.
The principal activity and the nature of business of the company is to produce and import different kinds of quality seeds, i.e. vegetables, maize, rice, wheat, oil, pulse, grass, potato, etc.
The company wants to spend Tk7 crore on building cold storage and land purchase, Tk5 crore on the development of modern research centre and Tk5.89 crore on bank loan repayment.
According to the company's audited financial statement as of 30 June this year, its net profit was Tk1.06 crore, which was Tk0.5 crore during the same period in the previous year.
Its sales revenue was Tk18.99 crore, which was Tk16.48 crore during the same period a year ago.
At the same time, its earnings per share was Tk4.71 and net asset value per share was Tk11.99.
Talking to The Business Standard, Krishibid Group Finance Director Md Sifat Ahmed Choudhury said: "We are trying to recover business in the post-pandemic period, and it is progressing well."
He said when it comes to selling paddy seeds, the firm is among the leading players while its other seeds have also good prospects.
"Our goal is to provide quality seeds for the farmers and gain traction," said Sifat.
The company started its business on 28 September 2016.
The seed market is growing due to extensive campaigns by both private companies and farmers.
The quality of seed accounts for 20-25% of productivity. The overall demand for quality seed has also increased.
According to business insiders, open-pollinated seeds have 34% share while hybrid seeds 66% in the market. 90% of the hybrid maize seeds are being imported from India.
The market of quality seeds – supplied by public and private sectors – stood at 3.5 lakh tons although the amount was around 1 lakh ton a decade ago.
The major players in the seed industry in the country are BRAC Seed, Square seed, Sajeeb seed, Partex seed, Advanta seeds, ACI-Agribusiness, Akij foods, BD Foods, Golden Harvest Agro, Pran Food Processing, Lal Teer, Ananda Agro and Krishibid Group.
The market grows by more than 10% a year with the shares of the private sector rising gradually.
The total market size of the seed industry was Tk2,350 crore in the Fiscal Year 2018-19.
Now, apart from the Bangladesh Agriculture Development Corporation, more than 100 firms, including some non-government organisations, sell seeds, mainly hybrid ones, through 18,000 registered dealers.
