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“Investment in capital market involves certain degree of risks. The investors are required to read the prospectus and risk factors carefully, assess their own financial conditions and risk taking ability before making their investment decisions.”
Public Offering of 25,000,000 Ordinary Shares of Tk. 10 each at par totaling Tk. 250,000,000
ISSUE DATE OF THE PROSPECTUS: [●]
Opening and closing date of subscription
Opening date of subscription: [●] Closing date of subscription (Cut-off date): [●]
PROSPECTUS
Name of Issuer
Mohammed Elias Brothers POY Manufacturing
Plant Limited
Name of Issue Managers
Prime Finance Capital Management Limited
PFI Tower (6th Floor), 56-57, Dilkusha C/A, Dhaka-1000 Phone: +88 02 9584874, +88 02 9584876-77; Fax: +88 02 9584922
E-mail: [email protected]; Website: www.primefincap.com
AIBL Capital Management Limited Peoples Insurance Bhaban (4th Floor), 36 Dilkusha C/A, Dhaka-1000
Phone: +88 02 9551962, PABX 57160786-7; Fax: +88 02 9575379
E-mail: [email protected]; Website: www.al-arafahbank.com
AB Investment Limited
WW Tower (Level-7), 68, Motijheel C/A, Dhaka 1000
Phone: +88-02-9586169, +88-02-7125199, +88-02-9586169
E-mail: [email protected]; Website: www.abbl.com
2
(a) Preliminary information and declarations:
(I) Name(s), address(s), telephone number(s), web address(s), e-mail(s), fax number(s) and contact persons of the issuer, issue manager(s), underwriter(s), auditors, credit rating company and valuer, where applicable;
Name of parties Contact person Telephone and fax
number
Issuer Mohammed Elias Brothers POY Manufacturing Plant Limited Registered office: As Salam Tower (7th Floor), 57, Agrabad C/A, Chittagong-4100 Plant: 49/P, Kalurghat Heavy Industrial Area, Chittagong-4100 Email: : [email protected], Website: www.mebpoy.com
Mr. Mohd. Rezaul Karim Managing Director
Tel: (880)31-2511194-7 Fax: (880) 31-2511198
Issue Managers Prime Finance Capital Management Limited PFI Tower (6thFloor), 56-57 Dilkusha C/A, Dhaka-1000 E-mail: [email protected], Website: www.primefincap.com
Mr. M. Mosharraf Hossain FCA, PhD Managing Director & CEO
Tel: +88-02-9584874 Fax: +88-02-9584922
AIBL Capital Management Limited Peoples Insurance Bhaban (4th Floor) 36 Dilkusha C/A, Dhaka-1000 Email: [email protected], Website: www.al-arafahbank.com
Mr. Muhammad Husain Ahmad Faruqi Chief Executive Officer
Tel: +88 02 9551962 PABX 57160786-7
Fax: +88 02 9575379
AB Investment Limited WW Tower (Level-7), 68, Motijheel C/A, Dhaka 1000 E-mail: [email protected]; Website: www.abbl.com
Mr. Sheikh Ashraful Haque Chief Executive Officer
Tel: +88-02-7125199 Fax: +88-02-9586126
Underwriters Prime Finance Capital Management Limited PFI Tower (6thFloor),56-57 Dilkusha C/A, Dhaka-1000 E-mail: [email protected], Website: www.primefincap.com
Mr. M. Mosharraf Hossain FCA, PhD Managing Director & CEO
Tel: +88-02-9584874 Fax: +88-02-9584922
AIBL Capital Management Limited Peoples Insurance Bhaban (4th Floor) 36 Dilkusha C/A, Dhaka-1000 Email: [email protected], Website: www.al-arafahbank.com
Mr. Muhammad Husain Ahmad Faruqi Chief Executive Officer
Tel: +88 02 9551962, PABX 57160786-7
Fax: +88 02 9575379
AB Investment Limited WW Tower (Level-7), 68, Motijheel C/A, Dhaka 1000 E-mail: [email protected]; Website: www.abbl.com
Mr. Sheikh Ashraful Haque Chief Executive Officer
Tel: 01817143533 Fax: +88-02-9586126
ICB Capital Management Limited Green City Edge, 5th & 6th Floor, 89, kakrail, Dhaka- 1000 Email: [email protected], Website: www.icbcml.com.bd
Mr. Md. Shohel Rahman Chief Executive Officer (Additional Charge)
Tel: +88 02 8300555 Fax: 8802-8300396
BetaOne Investments Limited Green Delta AIMS Tower (Level–4), 51-52, Mohakhali C/A, Dhaka E-mail: [email protected], Website: www.betaone.com.bd
Mr. Mohammed Atiquzzaman Managing Director
Tel: +88-02-9887337 Fax: +88-02-9880733
First Security Islami Capital and Investment Limited Al-Amin Center (12th Floor), 25/A Dilkusha C/A, Dhaka – 1000 E-mail: [email protected], Website: www.fsicibd.com
Mr. K M Rasidul Hasan Chief Executive Officer
Tel: +88-02-9578569 Fax: +88-02-9515917
NBL Capital and Equity Management Limited Printers Building (8th Floor), 5, Rajuk Avenue, Dhaka-1000
E-mail: [email protected], Website: www.nblceml.com
Ms. Kamrun Naher Chief Executive Officer
Tel: +88-02-47118816 Fax: +88-02-47118805
PLFS Investments Limited City Centre (Level 12), Unit 11-B, 90/1 Motijheel C/A, Dhaka-1000
E-mail: [email protected] , Website: www.plfsil.com
Mr. Md. Abdul Muktadir, CFA Chief Executive Officer
Tel: +88-02-55110919 Fax: +88 02 55110939
Southeast Bank Capital Services Limited Eunoos Center (Level-9), 52-53 Dilkusha C/A, Dhaka -1000 E-mail: [email protected], Website: www.southeastbank.com.bd
Mr. Air Cdre ( Retd) Md Abu Bakar, FCA Managing Director (Current Charge)
Tel: +88-02-9574171 Fax: +88-02- 9574169
Grameen Capital Management Limited Grameen Bank 1st Building (2nd floor), Mirpur-2, Dhaka-1216 Email: [email protected], [email protected]
Mr. Mohammed Ahsan Ullah Managing Director
Tel: +88-02- 9004923 Fax : +88-02- 8057618
IIDFC Capital Limited Eunoos Trade Center (Level 7), 52-53 Dilkusha C/A, Dhaka 1000 Email: [email protected], web: www.iidfc.com
Mr. Mohammad Saleh Ahmed Chief Executive Officer
Tel: +88 02 9514637-8 Fax:+88-02-9514641
BMSL Investment Limited Shareef Mansion (4th floor), 56-57, Motijheel C/A, Dhaka-1000 Email: [email protected], Web:www.bmslinvestment.com
Md. Riyad Matin Managing Director
Tel: +88-02-9577651 Fax: +88-02-47117218
MIDAS Investment Limited House #05, Road # 16(New) 27 (old), Dhanmondi, Dhaka-1209 [email protected], www. Midasinv.com
Omer Farooque Manager (Accounts and Compliance)
Tel: +88-02-9119371 Fax: +88-02-8142085
Auditors
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Ahmed Zaker & Co. Chartered Accountants
74, Sk. Mujib Road, Agrabad, C/A Chittagong – 4100 E-mail: [email protected] Website: www.rmaandco.com
Mr. Arup Chowdhury Partner
Tel: 031-634103 Fax: 9551128
Valuer
Royal Inspection International Ltd. Al-Islam Chamber, 91 Agrabad C/A, Chittagong
E-mail: [email protected] Website: www.royalinspectionbd.net
Mr. Saiful Islam Land and Valuation Surveyor
Tel: +88031726436 Fax: +8803710205
(ii) A person interested to get a prospectus may obtain from the issuer, and the issue managers; (iii)“If you have any query about this document, you may consult issuer, issue manager and underwriter”;
(iv)“CONSENT OF THE BANGLADESH SECURITIES AND EXCHANGE COMMISSION HAS BEEN OBTAINED TO THE ISSUE/OFFER OF THESE SECURITIES UNDER THE SECURITIES AND EXCHANGE ORDINANCE, 1969, AND THE BANGLADESH SECURITIES AND EXCHANGE COMMISSION (PUBLIC ISSUE) RULES, 2015. IT MUST BE DISTINCTLY UNDERSTOOD THAT IN GIVING THIS CONSENT THE COMMISSION DOES NOT TAKE ANY RESPONSIBILITY FOR THE FINANCIAL SOUNDNESS OF THE ISSUER COMPANY, ANY OF ITS PROJECTS OR THE ISSUE PRICE OF ITS SECURITIES OR FOR THE CORRECTNESS OF ANY OF THE STATEMENTS MADE OR OPINION EXPRESSED WITH REGARD TO THEM. SUCH RESPONSIBILITY LIES WITH THE ISSUER, ITS DIRECTORS, CHIEF EXECUTIVE OFFICER, MANAGING DIRECTOR, CHIEF FINANCIAL OFFICER, COMPANY SECRETARY, ISSUE MANAGER, ISSUE MANAGER’S CHIEF EXECUTIVE OFFICER, UNDERWRITERS, AUDITOR(S), VALUER AND/OR CREDIT RATING COMPANY (IF ANY)."
(v) Risks in relation to the First Issue “This being the first issue of the issuer, there has been no formal market for the securities of the issuer. The face value of the securities is Tk. 10.00 (Ten) and the issue price is Tk. 10.00 (Ten) i.e. the face value. The issue price has been determined and justified by the issuer and the issue manager as stated under the paragraph on “Justification of Issue Price” should not be taken to be indicative of the market price of the securities after listing. No assurance can be given regarding an active or sustained trading of the securities or the price after listing.”
(vi) General Risk “Investment in securities involves a degree of risk and investors should not invest any funds in this offer unless they can afford to take the risk of losing their investment. Investors are advised to read the risk factors carefully before taking an investment decision in this offer. For taking an investment decision, investors must rely on their own examination of the issuer and the offer including the risks involved. The securities have not been recommended by the Bangladesh Securities and Exchange Commission (BSEC) nor does BSEC guarantee the accuracy or adequacy of this document. Specific attention of investors is invited to the statement of ‘risk factors’ given on page number(s) 128-135 “
(vii) Mohammed Elias Brothers POY Manufacturing Plant Limited ’s Absolute Responsibility “The issuer, having made all reasonable inquiries, accepts responsibility for and confirms that this prospectus contains all material information with regard to the issuer and the issue, that the information contained in the prospectus are true, fair and correct in all material aspects and are not misleading in any respect, that the opinions and intentions expressed herein are honestly held and that there are no other facts, the omission of which make this document as a whole or any of such information or the expression of any such opinions or intentions misleading in any material respect.”
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(b) Availability of prospectus:
(i) Names, addresses, telephone numbers, fax numbers, website addresses and e-mail addresses and names of contact persons of the institutions where the prospectus and abridged version of prospectus are available in hard and soft forms;
The prospectus of Mohammed Elias Brothers POY Manufacturing Plant Limited is available in hard and soft forms at the following addresses:
Name of parties Contact person Telephone and fax numbers
Issuer
Mohammed Elias Brothers POY Manufacturing Plant Limited
Registered office:
As Salam Tower (7th Floor), 57, Agrabad C/A, Chittagong-4100
Plant: 49/P, Kalurghat Heavy Industrial Area, Chittagong-4100
Email: [email protected] Website: www.mebpoy.com
Mr. Mohd. Rezaul Karim Managing Director
Tel: (880) 31-2511194-7 Fax: (880) 31-2511198
Issue Managers
Prime Finance Capital Management Limited
PFI Tower (6th Floor), 56-57, Dilkusha C/A, Dhaka-1000 E-mail: [email protected] Website: www.primefincap.com
Mr. M. Mosharraf Hossain FCA, PhD
Managing Director & CEO Tel: +88-02-9584874 Fax: +88-02-9584922
AIBL Capital Management Limited
Peoples Insurance Bhaban (4th Floor) 36 Dilkusha C/A, Dhaka-1000 Email: [email protected] Website: www.al-arafahbank.com
Mr. Muhammad Husain Ahmad Faruqi
Chief Executive Officer Tel: +88 02 7123255-7 Fax: +88 02 9569351
AB Investment Limited
WW Tower (Level-7), 68, Motijheel C/A,
Dhaka 1000
E-mail: [email protected] Website: www.abbl.com
Mr. Sheikh Ashraful Haque Chief Executive Officer
Tel: +88-02-9586169
Fax: +88-02-9586126
(ii) Names and dates of the newspapers where abridged version of prospectus was published
Sl. Name of the newspaper Date of publication
1 [•] [•]
2 [•] [•] 3 [•] [•] 4 [•] [•]
(iii) Definition and acronyms or elaborations;
Unless the context otherwise indicates, requires or implies, the following terms shall have the meaning set forth below in this prospectus. Reference to statutes, rules, regulations, guidelines and policies will be deemed to include all amendments and modifications notified thereto.
General terms Terms Description
“Mohammed Elias Brothers POY
Manufacturing Plant Limited”, “MEBPOY ”, “The Company” “We” or “us” or “our Company” or “the Issuer”
Unless the context otherwise requires, refers to Mohammed Elias Brothers POY Manufacturing Plant Limited, a Company duly incorporated under the Companies Act, 1994 vide a Certificate of Incorporation issued by the Registrar of Joint Stock Companies and Firms with its registered office in Dhaka, Bangladesh.
“you”, “your” or “yours” Prospective investors in this Issue.
5
Legal terms
Terms Description
Auditors
Ahmed Zaker & Co. Chartered Accountants 74, Sk. Mujib Road, Agrabad, C/A Chittagong – 4100
Tel: 031-634103, Cell No. 01819385193, E-mail: [email protected]
Board of Directors/Board The Board of Directors of Mohammed Elias Brothers POY Manufacturing Plant Limited, as duly constituted from time to time including any committee thereof.
Companies Act Unless specified otherwise, this would imply to the provisions of the Companies Act, 1994.
Depositories Act The Depositories Act, 1999, as amended from time to time
Director(s) Director(s) of Mohammed Elias Brothers POY Manufacturing Plant Limited, unless otherwise specified
Group Companies All companies or ventures which would be termed as Group Companies as per the definition given in Bangladesh Securities and Exchange Commission (Public Issue) Rules, 2015
MOA/Memorandum/Memorandum of Association
Memorandum of Association of Mohammed Elias Brothers POY Manufacturing Plant Limited
AOA/Articles/Articles of Association
Articles of Association of Mohammed Elias Brothers POY Manufacturing Plant Limited
RJSC Registrar of Joint Stock Companies & Firms
Issue related terms
Terms Description
AGM Annual General Meeting
Allotment Unless the context otherwise requires, the allotment of Ordinary shares pursuant to the Issue to Allottees
Allotees Persons to whom ordinary shares of MEBPOY will be allotted
BSEC Bangladesh Securities and Exchange Commission
BAS Bangladesh Accounting Standards
BFRS Bangladesh Financial Reporting Standards
BDT/Tk. /Taka Bangladeshi Taka
BO Beneficiary Owner
CDBL Central Depository Bangladesh Limited
EBITDA Earnings before Interest, Tax, Depreciation and Amortization
EPS Earnings Per Share
EI Eligible Investor as defined by the Bangladesh Securities and Exchange Commission (Public Issue) Rules, 2015
Financial Year/Fiscal/FY Period of 3 months ended on September 30, 2017 and year ended, June 30, 2017, period ended June 2016 and year ended on 31 December 2015, 2014, 2013, 2012
FC Account Foreign Currency Account
GBP Great Britain Pound
GoB Government of Bangladesh
IPO Initial Public Offer
NBR National Board of Revenue
NRB Non-resident Bangladeshi
NPAT Net Profit after Tax
PFCML Prime Finance Capital Management Limited
Stock Exchange(s) Unless the context requires otherwise, refers to, the Dhaka Stock Exchange Limited (DSE) & Chittagong Stock Exchange Limited (CSE) where Ordinary shares of the Company will be listed.
VAT Value Added Tax
USD United States Dollar
6
TABLE OF CONTENTS
SL. NO. PARTICULARS PAGE NO.
CHAPTER (I) EXECUTIVE SUMMARY 17-21
(a) About the industry 18
(b) About the issuer 18
(c) Financial information 19
(d) Features of the issue and its objects 19
(e) Legal and other information 19
(f) Promoters’ background 20
(g) Capital structure and history of capital raising 21
(h) Summary of valuation report of securities 21
(i) Others 21
CHAPTER (II)
CONDITIONS IMPOSED BY THE COMMISSION IN THE CONSENT LETTER 22-26
Disclosure in respect of issuance of security in demat form: 23
Conditions under 2cc of the Securities and Exchange Ordinance, 1969 23
CHAPTER (III) DECLARATION AND DUE DILIGENCE CERTIFICATES 27-45
Annexure-A Declaration about the responsibility of the Director(s), including the CEO of Mohammed Elias Brothers POY Manufacturing Plant Limited in respect of Prospectus
28
Annexure-B Due Diligence Certificate of the Manager to the Issue 29
Annexure-C Due Diligence Certificate of the Underwriter(s) 33
CHAPTER (IV) ABOUT THE ISSUER 46-47
(a) Name of the issuer, dates of incorporation and commencement of its commercial operations, its logo, addresses of its registered office, other offices and plants, telephone number, fax number, contact person, website address and e-mail address;
47
(b) The names of the sponsors and directors of the issuer; 47
(c) The name, logo and address of the auditors and registrar to the issue, along with their telephone numbers, fax numbers, contact persons, website and e-mail addresses;
47
(d) The name(s) of the stock exchanges where the specified securities are proposed to be listed.
47
CHAPTER (V) CORPORATE DIRECTORY OF THE ISSUER 48-49
CHAPTER (VI) DESCRIPTION OF THE ISSUER 50-80
(a)
Summary 51
(i) The summary of the industry and business environment of the issuer 51
(ii) Summary of consolidated financial, operating and other information 51
(b)
General Information 52
(i) Name and address, telephone and fax numbers of the registered office, corporate head office, other offices, factory, business premises and outlets of the issuer
52
(ii) The board of directors of the issuer 52
(iii) Names, addresses, telephone numbers, fax numbers and e-mail addresses of the chairman, managing director, whole time directors, etc. of the issuer
52
(iv) Names, addresses, telephone numbers, fax numbers and e-mail addresses of the CFO, company secretary, legal advisor, auditors and compliance officer
52
(v) Names, addresses, telephone numbers, fax numbers, contact person, website addresses and e-mail addresses of the issue manager(s)
53
(vi) Details of credit rating, where applicable 53
(vii)
Following details of underwriting: 53
(a) The names, addresses, telephone numbers, fax numbers, contact persons and e-mail addresses of the underwriters and the amount underwritten by them
53
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(b) Declaration by the underwriters that they have sufficient resources as per the regulatory requirements to discharge their respective obligations
54
(c) Major terms and conditions of the underwriting agreements 54
(c)
Capital Structure 55
(i) Authorized, issued, subscribed and paid up capital (number and class of securities, allotment dates, nominal price, issue price and form of consideration)
55
(ii) Size of the present issue, with break-up (number of securities, description, nominal value and issue amount)
55
(iii) Paid up capital before and after the present issue, after conversion of convertible instruments (if any) and share premium account (before and after the issue)
55
(iv) Category wise shareholding structure with percentage before and after the present issue and after conversion of convertible instruments (if any)
56
(v)
Where shares have been issued for consideration in other than cash at any point of time, details in a separate table, indicating the date of issue, persons to whom those are issued, relationship with the issuer, issue price, consideration and valuation thereof, reasons for the issue and whether any benefits have been accrued to the issuer out of the issue
56
(vi) Where shares have been allotted in terms of any merger, amalgamation or acquisition scheme, details of such scheme and shares allotted
56
(vii) Where the issuer has issued equity shares under one or more employee stock option schemes, date-wise details of equity shares issued under the schemes, including the price at which such equity shares were issued
56
(viii)
If the issuer has made any issue of specified securities at a price lower than the issue price during the preceding two years, specific details of the names of the persons to whom such specified securities have been issued, relation with the issuer, reasons for such issue and the price thereof
56
(ix) The decision or intention, negotiation and consideration of the issuer to alter the capital structure by way of issue of specified securities in any manner within a period of one year from the date of listing of the present issue
56
(x)
The total shareholding of the sponsors and directors in a tabular form, clearly stating the names, nature of issue, date of allotment, number of shares, face value, issue price, consideration, date when the shares were made fully paid up, percentage of the total pre and post issue capital, the lock in period and the number and percentage of pledged shares, if any, held by each of them
56
(xi)
The details of the aggregate shareholding of the sponsors and directors, the aggregate number of specified securities purchased or sold or otherwise transferred by the sponsor and/or by the directors of the issuer and their related parties within six months immediate preceding the date of filing the prospectus
58
(xii)
The name and address of any person who owns, beneficially or of record, 5% or more of the securities of the issuer, indicating the amount of securities owned, whether they are owned beneficially or of record, and the percentage of the securities represented by such ownership including number of equity shares which they would be entitled to upon exercise of warrant, option or right to convert any convertible instrument
58
(xiii) The number of securities of the issuer owned by each of the top ten salaried officers, and all other officers or employees as group, indicating the percentage of outstanding shares represented by the securities owned
58
(d)
Description of Business 58
(i) The date on which the issuer company was incorporated and the date on which it commenced operations and the nature of the business which the company and its subsidiaries are engaged in or propose to engage in
58
(ii) Location of the project 58
8
(iii) Plant, machinery, technology, process, etc. 58
(iv) Details of the major events in the history of the issuer, including details of capacity or facility creation, launching of plant, products, marketing, change in ownership and/or key management personnel etc.
59
(v)
Principal products or services of the issuer and markets for such products or services. Past trends and future prospects regarding exports (if applicable) and local market, demand and supply forecasts for the sector in which the product is included with source of data
60
(vi) If the issuer has more than one product or service, the relative contribution to sales and income of each product or service that accounts for more than 10% of the company’s total revenues
60
(vii) Description of associates, subsidiary and holding company of the issuer and core areas of business thereof
60
(viii) How the products or services are distributed with details of the distribution channel. Export possibilities and export obligations, if any
61
(ix) Competitive conditions in business with names, percentage and volume of market shares of major competitors
61
(x) Sources and availability of raw materials, names and addresses of the principal suppliers and contingency plan in case of any disruption
61
(xi) Sources of, and requirement for, power, gas and water or any other utilities and contingency plan in case of any disruption
62
(xii) Names, address(s), telephone number, web address, e-mail and fax number of the customers who account for 10% or more of the company’s products or services with amount and percentage thereof
63
(xiii) Names, address(s), telephone number, web address, e-mail and fax number of the suppliers from whom the issuer purchases 10% or more of its raw material or finished goods with amount and percentage thereof
63
(xiv)
Description of any contract which the issuer has with its principal suppliers or customers showing the total amount and quantity of transaction for which the contract is made and the duration of the contract. If there is not any of such contract, a declaration is to be disclosed duly signed by CEO or MD, CFO and Chairman on behalf of Board of Directors
63
(xv) Description of licenses, registrations, NOC and permissions obtained by the issuer with issue, renewal and expiry dates
63
(xvi) Description of any material patents, trademarks, licenses or royalty agreements
64
(xvii) Number of total employees and number of full-time employees 64
(xviii) A brief description of business strategy 64
(xix)
A table containing the existing installed capacities for each product or service, capacity utilization for these products or services in the previous years, projected capacities for existing as well as proposed products or services and the assumptions for future capacity utilization for the next three years in respect of existing as well as proposed products or services. If the projected capacity utilization is higher than the actual average capacity utilization, rationale to achieve the projected levels
64
(e)
Description of Property 64
(i) Location and area of the land, building, principal plants and other property of the company and the condition thereof
64
(ii) Whether the property is owned by the company or taken on lease 65
(iii) Dates of purchase, last payment date of current rent (LvRbv) and mutation date
of lands, deed value and other costs including details of land development cost, if any and current use thereof
65
(iv) The names of the persons from whom the lands has been acquired or proposed to be acquired along with the cost of acquisition and relation, if any, of such persons to the issuer or any sponsor or director thereof
66
9
(v) Details of whether the issuer has received all the approvals pertaining to use of the land, if required
66
(vi) If the property is owned by the issuer, whether there is a mortgage or other type of charge on the property, with name of the mortgagee
66
(vii) If the property is taken on lease, the expiration dates of the lease with name of the lessor, principal terms and conditions of the lease agreements and details of payment
66
(viii)
Dates of purchase of plant and machineries along with sellers name, address, years of sale, condition when purchased, country of origin, useful economic life at purchase and remaining economic life, purchase price and written down value
66
(ix) Details of the machineries required to be bought by the issuer, cost of the machineries, name of the suppliers, date of placement of order and the date or expected date of supply, etc.
68
(x) In case the machineries are yet to be delivered, the date of quotations relied upon for the cost estimates given shall also be mentioned
68
(xi) If plant is purchased in brand new condition then it should be mentioned 68
(xii)
Details of the second hand or reconditioned machineries bought or proposed to be bought, if any, including the age of the machineries, balance estimated useful life, etc. as per PSI certificates of the said machineries as submitted to the Commission
68
(xiii) A physical verification report by the issue manager(s) regarding the properties as submitted to the Commission
69
(xiv) If the issuer is entitled to any intellectual property right or intangible asset, full description of the property, whether the same are legally held by the issuer and whether all formalities in this regard have been complied with
70
(xv) Full description of other properties of the issuer 70
(f)
Plan of Operation and Discussion of Financial Condition 70
(i) If the issuer has not started its commercial operation, the company’s plan of operations for the period which would be required to start commercial operation which shall, among others, include:-
70
(ii)
If the issuer had been in operation, the issuer’s revenue and results from operation, financial position and changes in financial position and cash flows for the last five years or from commercial operation, which is shorter, shall be furnished in tabular form which shall, among others, include the following information:
70
a) Internal and external sources of cash 71
b) Any material commitments for capital expenditure and expected sources of funds for such expenditure
71
c) Causes for any material changes from period to period in revenues, cost of goods sold, other operating expenses and net income
71
d) Any seasonal aspects of the issuer’s business 72
e) Any known trends, events or uncertainties that may have material effect on the issuer’s future business
72
f) Any assets of the company used to pay off any liabilities 72
g) Any loan taken from or given to any related party or connected person of the issuer with details of the same
72
h) Any future contractual liabilities the issuer may enter into within next one year, and the impact, if any, on the financial fundamentals of the issuer
72
i) The estimated amount, where applicable, of future capital expenditure 72
j) Any VAT, income tax, customs duty or other tax liability which is yet to be paid, including any contingent liabilities stating why the same was not paid prior to the issuance of the prospectus. Updated income
72
10
tax status for the last 5 years or from commercial operation, which is shorter
k)
Any financial commitment, including lease commitment, the company had entered into during the past five years or from commercial operation, which is shorter, giving details as to how the liquidation was or is to be effected
73
l) Details of all personnel related schemes for which the company has to make provision for in future years
73
m) Break down of all expenses related to the public issue 74
n)
If the issuer has revalued any of its assets, the name, qualification and experiences of the valuer and the reason for the revaluation, showing the value of the assets prior to the revaluation separately for each asset revalued in a manner which shall facilitate comparison between the historical value and the amount after revaluation and giving a summary of the valuation report along with basis of pricing and certificates required under the revaluation guideline of the Commission
74
o)
Where the issuer is a holding or subsidiary company, full disclosure about the transactions, including its nature and amount, between the issuer and its subsidiary or holding company, including transactions which had taken place within the last five years of the issuance of the prospectus or since the date of incorporation of the issuer, whichever is later, clearly indicating whether the issuer is a debtor or a creditor
75
p)
Financial Information of Group Companies and Companies under common ownership by more than 50%: following information for the last three years based on the audited financial statements, in respect of all the group companies of the issuer, wherever applicable, along with significant notes of auditors
75
q)
Where the issuer is a banking company, insurance company, non-banking financial institution or any other company which is regulated and licensed by another primary regulator, a declaration by the board of directors shall be included in the prospectus stating that all requirements of the relevant laws and regulatory requirements of its primary regulator have been adhered to by the issuer
75
r)
A report from the auditors regarding any allotment of shares to any person for any consideration otherwise than cash along with relationship of that person with the issuer and rationale of issue price of the shares
75
s) Any material information, which is likely to have an impact on the offering or change the terms and conditions under which the offer has been made to the public
76
t)
Business strategies and future plans - projected financial statements shall be required only for companies not started commercial operation yet and authenticated by Chairman, two Directors, Managing Director, CFO, and Company Secretary
76
u)
Discussion on the results of operations shall inter-alia contain the following:
76
1) A summary of the past financial results after adjustments as given in the auditor’s report containing significant items of income and expenditure
76
2) A summary of major items of income and expenditure 77
3) The income and sales on account of major products or services 77
4) In case, other income constitutes more than 10% of the total income, the breakup of the same along with the nature of the income, i.e., recurring or non-recurring
77
11
5)
If a material part of the income is dependent upon a single customer or a few major customers, disclosure of this fact along with relevant data. Similarly if any foreign customer constitutes a significant portion of the issuer’s business, disclosure of the fact along with its impact on the business considering exchange rate fluctuations
77
6) In case the issuer has followed any unorthodox procedure for recording sales and revenues, its impact shall be analyzed and disclosed
77
v)
Comparison of recent financial year with the previous financial years on the major heads of the profit and loss statement, including an analysis of reasons for the changes in significant items of income and expenditure, inter-alia, containing the following:
78
1)
Unusual or infrequent events or transactions including unusual trends on account of business activity, unusual items of income, change of accounting policies and discretionary reduction of expenses etc.
78
2) Significant economic changes that materially affect or are likely to affect income from continuing operations
78
3) Known trends or uncertainties that have had or are expected to have a material adverse impact on sales, revenue or income from continuing operations
78
4) Future changes in relationship between costs and revenues, in case of events such as future increase in labor or material costs or prices that will cause a material change are known
78
5) The extent to which material increases in net sales or revenue are due to increased sales volume, introduction of new products or services or increased sales prices
78
6) Total turnover of each major industry segment in which the issuer operated
78
7) Status of any publicly announced new products or business segment
79
8) The extent to which the business is seasonal 79
w)
Defaults or rescheduling of borrowings with financial institutions or banks, conversion of loans into equity along with reasons thereof, lock out, strikes and reasons for the same etc. during the history of operation of the company
79
x)
Details regarding the changes in the activities of the issuer during the last five years which may had a material effect on the profits or loss, including discontinuance of lines of business, loss of agencies or markets and similar factors
79
y) Injunction or restraining order, if any, with possible implications 79
z) Technology, market, managerial competence and capacity built-up 79
aa) Changes in accounting policies in the last three years 79
bb)
Significant developments subsequent to the last financial year: A statement by the directors whether in their opinion there have arisen any circumstances since the date of the last financial statements as disclosed in the prospectus and which materially and adversely affect or is likely to affect the trading or profitability of the issuer, or the value of its assets, or its ability to pay its liabilities within the next twelve months
79
cc)
If any quarter of the financial year of the issuer ends after the period ended in the audited financial statements as disclosed in the prospectus unaudited financial statements for each of the said quarters duly authenticated by the CEO and CFO of the issuer
80
dd) Factors that may affect the results of operations 80
12
CHAPTER (VII) MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
81-84
(a) Overview of business and strategies 82
(b) SWOT Analysis 82
(c) Analysis of the financial statements of last five years 83
(d) Known trends demands, commitments, events or uncertainties 83
(e) Trends or expected fluctuations in liquidity 84
(f) Off-balance sheet arrangements 84
CHAPTER (VIII) DIRECTORS AND OFFICERS 85-92
(a)
Name, Father’s name, age, residential address, educational qualification, experience and position of each of the directors of the company and any person nominated or represented to be a director, showing the period for which the nomination has been made and the name of the organization which has nominated him;
86
(b) The date on which he first became a director and the date on which his current term of office shall expire;
86
(c) If any director has any type of interest in other businesses, names and types of business of such organizations. If any director is also a director of another company or owner or partner of any other concern, the names of such organizations;
86
(d)
Statement of if any of the directors of the issuer are associated with the securities market in any manner. If any director of the Issuer Company is also a director of any issuer of other listed securities during last three years then dividend payment history and market performance of that issuer;
86
(e) Any family relationship (father, mother, spouse, brother, sister, son, daughter, spouse’s father, spouse’s mother, spouse’s brother, spouse’s sister) among the directors and top five officers;
86
(f) A very brief description of other businesses of the directors; 87
(g) Short bio-data of each director; 87
(h) Loan status of the issuer, its directors and shareholders who hold 10% or more shares in the paid-up capital of the issuer in terms of the CIB Report of Bangladesh Bank;
87
(i)
Name with position, educational qualification, age, date of joining in the company, overall experience (in year), previous employment, salary paid for the financial year of the Chief Executive Officer, Managing Director, Chief Financial Officer, Company Secretary, Advisers, Consultants and all Departmental Heads. If the Chairman, any director or any shareholder received any monthly salary than this information should also be included;
88
(j)
Changes in the key management persons during the last three years. Any change otherwise than by way of retirement in the normal course in the senior key management personnel particularly in charge of production, planning, finance and marketing during the last three years prior to the date of filing the information memorandum. If the turnover of key management personnel is high compared to the industry, reasons should be discussed;
88
(k)
A profile of the sponsors including their names, father’s names, age, personal addresses, educational qualifications, and experiences in the business, positions or posts held in the past, directorship held, other ventures of each sponsor and present position;
88
(l)
If the present directors are not the sponsors and control of the issuer was acquired within five years immediately preceding the date of filing prospectus details regarding the acquisition of control, date of acquisition, terms of acquisition, consideration paid for such acquisition etc.
89
(m) If the sponsors or directors do not have experience in the proposed line of business, the fact explaining how the proposed activities would be carried out or managed;
90
(n) Interest of the key management persons; 90
(o) All interests and facilities enjoyed by a director; 90
(p) Number of shares held and percentage of share-holding (pre issue); 90
13
(q) Change in board of directors during last three years; 92
(r) Director’s engagement with similar business. 92
CHAPTER (IX) CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS 93-94
(a)
The prospectus shall contain a description of any transaction during the last five years, or any proposed transactions certified by the auditors, between the issuer and any of the following persons, giving the name of the persons involved in the transaction, their relationship with the issuer, the nature of their interest in the transaction and the amount of such interest, namely:
94
(i) Any director or sponsor or executive officer of the issuer 94
(ii) Any person holding 5% or more of the outstanding shares of the issuer 94
(iii) Any related party or connected person of any of the above persons 94
(b)
Any transaction or arrangement entered into by the issuer or its subsidiary or associate or entity owned or significantly influenced by a person who is currently a director or in any way connected with a director of either the issuer company or any of its subsidiaries or holding company or associate concerns, or who was a director or connected in any way with a director at any time during the last three years prior to the issuance of the prospectus
94
(c)
Any loans either taken or given from or to any director or any person connected with the director, clearly specifying details of such loan in the prospectus, and if any loan has been taken from any such person who did not have any stake in the issuer, its holding company or its associate concerns prior to such loan, rate of interest applicable, date of loan taken, date of maturity of loan, and present outstanding of such loan
94
CHAPTER (X) EXECUTIVE COMPENSATION 95-96
(a) The total amount of remuneration or salary or perquisites paid to the top five salaried officers of the issuer in the last accounting year and the name and designation of each such officer
96
(b) Aggregate amount of remuneration paid to all directors and officers as a group during the last accounting year
96
(c) If any shareholder director received any monthly salary or perquisite or benefit it must be mentioned along with date of approval in AGM or EGM, terms thereof and payments made during the last accounting year
96
(d) The board meeting attendance fees received by the director including the managing director along with date of approval in AGM or EGM
96
(e) Any contract with any director or officer providing for the payment of future compensation
96
(f) If the issuer intends to substantially increase the remuneration paid to its directors and officers in the current year, appropriate information regarding thereto
96
(g) Any other benefit or facility provided to the above persons during the last accounting year
96
CHAPTER (XI) OPTIONS GRANTED TO DIRECTORS, OFFICERS AND EMPLOYEES 97-98
CHAPTER (XII) TRANSACTION WITH THE DIRECTORS AND SUBSCRIBERS TO THE MEMORANDUM
99-100
(a)
The names of the directors and subscribers to the memorandum, the nature and amount of anything of value received or to be received by the issuer from the above persons, or by the said persons, directly or indirectly, from the issuer during the last five years along with the description of assets, services or other consideration received or to be received
100
(b)
If any assets were acquired or to be acquired within next two financial years from the aforesaid persons, the amount paid for such assets and the method used to determine the price shall be mentioned in the prospectus, and if the assets were acquired by the said persons within five years prior to transfer those to the issuer, the acquisition cost thereof paid by them.
100
CHAPTER (XIII) OWNERSHIP OF THE COMPANY’S SECURITIES 101-106
14
(a) The names, addresses, BO ID Number of all shareholders of the company before IPO, indicating the amount of securities owned and the percentage of the securities represented by such ownership, in tabular form;
102
(b) There shall also be a table showing the name and address, age, experience, BO ID Number, TIN number, numbers of shares held including percentage, position held in other companies of all the directors before the public issue;
103
(c) The average cost of acquisition of equity shares by the directors certified by the auditors;
104
(d) A detail description of capital built up in respect of shareholding (name-wise) of the issuer’s sponsors/ directors. In this connection, a statement to be included:-
104
(e) Detail of shares issued by the company at a price lower than the issue price; 105
(f) History of significant (5% or more) changes in ownership of securities from inception. 106
CHAPTER (XIV) CORPORATE GOVERNANCE 107-115
(a) A disclosure to the effect that the issuer has complied with the requirements of Corporate Governance Guidelines
108
(b) A compliance report of Corporate Governance 108
(c) Details relating to the issuer's audit committee and remuneration committee 115
CHAPTER (XV) VALUATION REPORT OF SECURITIES PREPARED BY THE ISSUE MANAGER 116-118
CHAPTER (XVI) DEBT SECURITIES 119-120
CHAPTER (XVII) PARTIES INVOLVED AND THEIR RESPONSIBILITIES 121-122
CHAPTER (XVIII) MATERIAL CONTRACTS 123-125
CHAPTER (XIX) OUTSTANDING LITIGATIONS, FINE OR PENALTY 126-127
CHAPTER (XX) RISK FACTORS AND MANAGEMENT’S PERCEPTIONS ABOUT THE RISKS 128-135
(i) Internal risk factors may include, among others 129
(ii) External risk factors may include among others 133
CHAPTER (XXI) DESCRIPTION OF THE ISSUE 136-138
(a) Issue Size 137
(b) Number of securities to be issued 137
(c) Authorized capital and paid-up capital 137
(d) Face value, premium and offer price per unit of securities 137
(e) Number of securities to be entitled for each category of applicants 137
(f) Holding structure of different classes of securities before and after the issue 137
(g) Objective of the issue including financing requirements and feasibility in respect of enhanced paid-up capital
137
CHAPTER (XXII) USE OF PROCEEDS 139-147
(a) Use of net proceeds of the offer indicating the amount to be used for each purpose with head-wise break-up;
140
(b) Utilization of the total amount of paid-up capital and share premium, if any, including the sponsors’ contribution and capital raised of the issuer at the time of submission of prospectus, in details with indication of use of such funds in the financial statements;
140
(c)
If one of the objects is an investment in a joint venture, a subsidiary, an associate or any acquisition, details of the form of investment, nature of benefit expected to accrue to the issuer as a result of the investment, brief description of business and financials of such venture;
141
(d)
If IPO proceeds are not sufficient to complete the project, then source of additional fund must be mentioned. In this connection, copies of contract to meet the additional funds are required to be submitted to the Commission. The means and source of financing, including details of bridge loan or other financial arrangement, which may be repaid from the proceeds of the issue along with utilization of such funds;
141
(e)
A schedule mentioning the stages of implementation and utilization of funds received through public offer in a tabular form, progress made so far, giving details of land acquisition, civil works, installation of plant and machinery, the approximate date of completion of the project and the projected date of full commercial operation etc. The
141
15
schedule shall be signed by the Chief Executive Officer or Managing Director, Chief Financial Officer and Chairman on behalf of Board of Directors of the issuer;
(f)
If there are contracts covering any of the activities of the issuer for which the proceeds of sale of securities are to be used, such as contracts for the purchase of land or contracts for the construction of buildings, the issuer shall disclose the terms of such contracts, and copies of the contracts shall be enclosed as annexure to the prospectus;
142
(g)
If one of the objects of the issue is utilization of the issue proceeds for working capital, basis of estimation of working capital requirement along with the relevant assumptions, reasons for raising additional working capital substantiating the same with relevant facts and figures and also the reasons for financing short with long term investments and an item wise break-up of last three years working capital and next two years projection;
142
(h) Where the issuer proposes to undertake one or more activities like diversification, modernization, expansion, etc., the total project cost activity-wise or project wise, as the case may be;
142
(i) Where the issuer is implementing the project in a phased manner, the cost of each phase, including the phases, if any, which have already been implemented;
142
(j) The details of all existing or anticipated material transactions in relation to utilization of the issue proceeds or project cost with sponsors, directors, key management personnel, associates and group companies;
143
(k)
Summary of the project appraisal or feasibility report by the relevant professionals not connected with the issuer, issue manager and registrar to the issue with cost of the project and means of finance, weaknesses and threats, if any, as given in the appraisal or feasibility report.
143
CHAPTER (XXIII) LOCK-IN 148-150
CHAPTER (XXIV) MARKETS FOR THE SECURITIES BEING OFFERED 151-152
CHAPTER (XXV) DESCRIPTION OF SECURITIES OUTSTANDING OR BEING OFFERED 153-155
(a) Dividend, voting and preemption rights; 154
(b) Conversion and liquidation rights; 154
(c) Dividend policy; 154
(d) Other rights of the securities holders; 154
CHAPTER (XXVI) FINANCIAL STATEMENTS 156-195
(a)
The latest financial statements prepared and audited by any of the Commission’s panel of auditors in adherence to the provisions of the Securities and Exchange Rules, 1987, the †Kv¤úvwb AvBb, 1994, International Financial Reporting and Auditing Standards as
adopted in Bangladesh from time to time and any other law as applicable;
157
(b) Information as is required under section 186 of the †Kv¤úvwb AvBb, 1994 relating to holding
company; 183
(c) Selected ratios as specified in Annexure-D 183
(d)
Auditors report under Section 135(1), Para 24(1) of Part II of Schedule III of the †Kv¤úvwb
AvBb 1994. The report shall include comparative income statements and balance sheet
and aforementioned ratios for immediate preceding five accounting years of the issuer. If the issuer has been in commercial operation for less than five years, the above mentioned inclusion and submission will have to be made for the period since commercial operation;
184
(e) Financial spread sheet analysis for the latest audited financial statements; 186
(f) Earnings Per Share (EPS) on fully diluted basis (with the total existing number of shares) in addition to the weighted average number of shares basis. Future projected Net Income should not be considered while calculating the weighted average EPS;
187
(g) All extra-ordinary income or non-recurring income coming from other than core operations should be shown separately while showing the Net Profit as well as the Earnings Per Share;
187
(h) Quarterly or half-yearly EPS should not be annualized while calculating the EPS; 188
16
(i) Net asset value (with and without considering revaluation surplus or reserve) per unit of the securities being offered at the date of the latest audited statement of financial position.
188
(j) The Commission may require the issuer to re-audit the audited financial statements, if any deficiency or anomaly is found in the financial statements. In such a case, cost of audit should be borne by the concerned issuer
188
(k)
Following statements for the last five years or any shorter period of commercial operation certified by the auditors:-
188
(i) Statement of long term and short term borrowings including borrowing from related party or connected persons with rate of interest and interest paid or accrued;
189
(ii)
Statement of principal terms of secured loans and assets on which charge have been created against those loans with names of lenders, purpose, sanctioned amount, rate of interest, primary security, collateral or other security, re-payment schedule and status;
191
(iii) Statement of unsecured loans with terms & conditions; 192
(iv) Statement of inventories showing amount of raw material, packing material, stock-in-process and finished goods, consumable items, store & spares parts, inventory of trading goods etc.;
192
(v) Statement of trade receivables showing receivable from related party and connected persons;
192
(vi) Statement of any loan given by the issuer including loans to related party or connected persons with rate of interest and interest realized or accrued;
193
(vii) Statement of other income showing interest income, dividend income, discount received, other non-operating income;
193
(viii) Statement of turnover showing separately in cash and through banking channel;
193
(ix) Statement of related party transaction; 194
(x) Reconciliation of business income shown in tax return with net income shown in audited financial statements;
194
(xi) Confirmation that all receipts and payments of the issuer above Tk.5,00,000/- (five lac) were made through banking channel;
195
(xii) Confirmation that Bank Statements of the issuer are in conformity with its books of accounts;
195
(xiii) Statement of payment status of TAX, VAT and other taxes/duties; 195
(xiv) Any other statement as may be required by the Commission. 195
CHAPTER (XXVII) PUBLIC ISSUE APPLICATION PROCEDURE 196-200
CHAPTER (XXVIII)
MANAGEMENT DISCLOSURES AND OTHERS 201-203
17
CHAPTER - I EXECUTIVE SUMMARY
18
(a) About the industry
With the growing trend of increased consumption of Fully Draw Yarn (FDY), the internal requirement of product is rapidly increasing. Only 20% of the need can be met by the local production and the balance 80% has to be imported. The gap between the import cost and the manufacturing cost is too big and the feasibility of a new unit in Bangladesh is too high. At the same time, the demand of FDY is increasing at the rate of 12% per annum.
Since the local demand of Draw Textured Yarn (DTY) is much higher than the local production, a huge amount of DTY is required to be imported from various countries. Currently there are six companies producing DTY.
The use of DTY and the related industry is at present undergoing rapid structural changes, triggered in part by the withdrawal of import restrictions and the imminent easing of the import duty structure. The increasing expansion of garments factory, increasing demand of fishing net, mosquito net, weaving & knitting of fabrics for making clothes, home furnishings, seat covers, bags and many other uses in the country has boost up the need of more and more DTY, especially FDY which opened a new dimension in this sector.
(b) About the Issuer
Mohammed Elias Brothers POY Manufacturing Plant Limited was incorporated on 1st August 2002 under the Companies Act 1994 vide Reg. No. C-4410 of 2002 with an authorized capital of Tk. 3,000,000,000 divided into 300,000,000 ordinary shares of Tk. 10 each.
The initial product of the Company was only POY till Dec 2009. The forward linkage of POY (Partially Oriented Yarn) is DTY (Draw Textured Yarn). The DTY unit was procured on 31 Dec 2009 and merged with the Company. Since then the company is marketing DTY. From 2010 POY is the raw materials for DTY and 100% captive consumption.
The project of the Company is equipped with brand new modern machinery imported from Germany, Japan, USA, India and Turkey with a view to produce Partially Oriented Yarn (POY) and Draw Textured Yarn (DTY) of international standard.
The Company started its commercial operation with a license capacity per annum 10,500,000 kg, installed capacity per annum 9,800,000 kg for POY and DTY. The Company currently employs 263 people as on September 30, 2017. The Company is the active member of Bangladesh Textile Mills Association (BTMA).
A short profile about the Company is presented below:
Particulars Status
Date of incorporation as private Limited Company August 01, 2002
Commenced commercial operation January 01, 2007
Conversion date from Private Limited Company to Public Limited Company
October 21, 2010
Change of face value of share from Tk. 100/- to Tk. 10/- October 21, 2010
Registered office As Salam Tower (7th Floor), 57, Agrabad C/A, Chittagong-4100
Location of the factory 49/P, Kalurghat Heavy Industrial Area, Chittagong-4100
Authorized capital as on September 30, 2017 Tk.3,000,000,000 (Taka Three thousand million only)
Paid up capital as on September 30, 2017 Tk.1,680,000,000 (Taka One thousand six hundred and eighty million only)
Nature of business
The initial product of the Company was only POY till Dec 2009. The forward linkage of POY (Partially oriented Yarn) is DTY (Draw Textured Yarn). The DTY unit was procured on 31 Dec 2009 and merged with the Company. Since then the Company is marketing DTY. From 2010 POY is the raw materials for DTY and 100% captive consumption.
Major raw materials
Direct Raw Materials: ◊ Pet Chips ◊ Spin Finish Oil ◊ KHH
Indirect Raw Materials: ◊ Conning Oil ◊ Terminal Oil ◊ Paper Tube ◊ Stainless Steel Sand
Finished product ◊ Partially Oriented Yarn (POY) produced from Pet Chips. ◊ Draw Textured Yarn (DTY) produced from POY.
Total area of the factory 111.65 Khata
Total usable floor space 1,43,786 Sft.
Total manpower September 30, 2017 263 nos. person
19
(c) Financial information
Major financial information of Mohammed Elias Brothers POY Manufacturing Plant Limited is as follows: As per Audited Financial Statements
Amount in Taka
Particulars 30.09.2017 (3 months)
30.06.2017 30.06.2016 (6 months)
31.12.2015 31.12.2014 31.12.2013 31.12.2012
Sales 288,141,017 696,935,855 134,465,796 1,099,540,460 695,644,043 1,141,286,124 1,321,188,973 Cost of goods sold (175,702,069) (453,684,333) (47,101,289) (869,015,159) (480,818,559) (871,076,427) (1,088,825,788)
Gross profit 112,438,948 243,251,522 87,364,506 230,525,301 214,825,484 270,209,697 232,363,185 (41,672,741) (126,681,334) (47,118,695) (114,910,085) (57,302,500) (131,502,942) (137,618,467)
Administrative expenses (7,878,396) (34,857,137) (15,393,666) (32,977,535) (27,794,928) (60,439,577) (54,414,594) Selling & distribution expenses (6,395,022) (11,729,031) (3,030,021) (6,249,759) (2,257,553) (22,098,405) (24,650,236) Financial expense (27,399,324) (80,095,166) (28,695,008) (75,682,791) (27,250,019) (48,964,960) (58,553,637)
Operating profit 70,766,206 116,570,188 40,245,811 115,615,216 157,522,984 138,706,755 94,744,718
Non-operating income 653,394 1,315,035 390,711 3,022,699 3,818,601 41,548,051 8,481,951
Operating profit before contribution to W.P.P.F
71,419,600 117,885,223 40,636,522 118,637,915 161,341,585 180,254,806 103,226,669
Provision for W.P.P.F (3,400,933) (5,613,582) (1,935,072) (5,649,424) (7,682,933) (8,583,562) (4,915,555)
Profit before tax 68,018,667 112,271,641 38,701,449 112,988,491 153,658,652 171,671,244 98,311,114 Income tax expenses (10,760,094) (513,729) (5,805,217) (16,961,954) (23,103,852) (29,728,922) (19,978,810)
Current tax expense (9,204,587) 3,183,168 (3,633,992) (12,603,678) (17,251,686) (25,750,686) (14,355,032) Deferred tax expense (1,555,507) (3,696,897) (2,171,225) (4,358,276) (5,852,165) (3,978,236) (5,623,778)
Profit for the year 57,258,574 111,757,912 32,896,232 96,026,537 130,554,800 141,942,322 78,332,304 Other comprehensive income - - - - - (26,925,390) 6,604,839
Total Comprehensive Income for the year
57,258,574 111,757,912 32,896,232 96,026,537 130,554,800 115,016,932 84,937,143
Earnings per Share (EPS) Basic-Reported
0.34 0.67 0.20 0.57 0.78 0.84 0.52
Earnings per Share (EPS) Basic-Restated
0.47
(d) Features of the Issue and its objects
Ordinary shares offered: Present issue (subject to approval of regulatory authority)
25,000,000 Ordinary Shares of Tk. 10 each at par totaling Tk. 250,000,000 (Taka Two hundred and fifty million only)
Of which:
Issue reserved for the EIs (50% of total issue size) (Subject to approval of regulatory authority) of which:
12,500,000 Ordinary shares of Tk.10 each for cash at a price of Tk. 10 per share Tk.125,000,000
1. EI excluding Mutual Funds and CIS (40% of total issue size)
10,000,000 Ordinary shares of Tk.10 each for cash at a price of Tk. 10 per share Tk.100,000,000
2. Mutual Funds and CIS (10% of total issue size)
2,500,000 Ordinary shares of Tk.10 each for cash at a price of Tk. 10 per share Tk.25,000,000
General Public (50% of total issue size) (Subject to approval of regulatory authority)
12,500,000 Ordinary shares of Tk.10 each for cash at a price of Tk. 10 per share Tk.125,000,000
1. GP excluding NRB (40% of total issue size) 10,000,000 Ordinary shares of Tk.10 each for cash at a price of Tk. 10 per share Tk.100,000,000
2. NRB (10% of total issue size) 2,500,000 Ordinary shares of Tk.10 each for cash at a price of Tk. 10 per share Tk.25,000,000
Ordinary shares outstanding prior to the Issue 168,000,000 Ordinary shares
Ordinary shares outstanding after the Issue (Subject to approval of regulatory authority)
193,000,000 Ordinary shares
Objects of the Issue The net proceeds of IPO shall be utilized for Procurement of Machinery for FDY Project as described in the Section-XXII as titled of “Use of Proceeds” of this Prospectus.
(e)Legal and other information
Sl. Name of Licenses, registration, NOC
and permission
License Issuer/Issuing Authority
Registration/Certificate/ License No.
Issue Date Date of renewal
Date of expiry
1 Certificate of Incorporation
Registrar of Joint Stock companies and Firms
C-4410/2002 01/08/2002 N/A N/A
2 TIN Certificate National Board of
Revenue, Bangladesh E-TIN:849708878669/C-45
(Companies) 17.08.2013 N/A N/A
20
3 VAT Certificate Customs, Excise and
VAT Commissionarate, Bangladesh
2101010761 Area Code: 20401
04.04.2005 N/A N/A
4 IRC Controller of Export and
Import 105412 19/4/2000 03/07/2017 2017-18
5 Trade License Chittagong City
Corporation 176059 7/7/2015 12/07/2017 June 2018
6 Factory License Dy Chief Inspector of Factories, Govt. of the Peoples Republic of
Bangladesh 3674/Chittagong 13/06/2007 09/07/2017
June 2018
7 Fire License Fire Service and Civil
Defense Chottro- 1135/12-13 10/07/2012 24/07/2017 June 2018
8 Environmental
Clearance Certificate Department of Environment,
Chittagong 22.02.1500.162.72.028.16.158 15/01/2009 13/03/2017 12/03/2018
9 BOI license Board of Investment,
Bangladesh 20040512- C 25/05/2004 N/A N/A
10 Membership
certificate
Chittagong Metropolitan Chamber of Commerce
and Industry 1769 06/03/ 2017 04/01/2018 31/12/2018
(f) Promoters’ background
The subscribers to the memorandum of the Company were as follows:
Sl. Name of the promoter Status
1 Hajee Ahmed Hossain
Subscriber to the memorandum
2 Mr. Md. Shamsul Alam
3 Mr. Md. Nurul Absar
4 Mr. Md. Nurul Alam
5 Mr. Md. Khurshed Alam
6 Mr. Mohd. Reazul Karim
7 Mr. Md. Morshedul Alam
8 Mr. Md. Aminul Karim
Hajee Ahmed Hossain Late Alhaj Ahmed Hussain son of Late Fasiul Haque was a pioneer industrialist who dared to setup industries on manufacturing GP/CI Sheets, Glass Sheets and refining Soybean Oil in the Private Sector. He also setup many other industries of which MEB Paper and Board Mills, MEB Textile Mills, MEB Agro Dairy Products, MEB Bricks, MEB Tank Terminal, MEB Ship Breaking Yard, are notable. He was the sole distributor of Unilever Products. This great man of versatile genius breathed his last breath in the year of 2002.
Mr. Md. Shamsul Alam
Mohd. Shamsul Alam, Son of Late Mohd. Elias, the sponsor Director of the Company having graduation from Chittagong University, started his career in the textile industry. He is a dynamic & hard working person. Mr. Alam gathered experience in the manufacturing business through his 25 years’ business career.
Mr. Md. Nurul Absar
Mr. Mohd. Nurul Absar, Son of Late Hajee Ahmed Hossain, the sponsor director & former Chairman of the Company completed his graduation from Commerce College, Chittagong. His visionary leadership gives an immense standing of the Company in the concerned Industry. He has gained wide expertise in modern business namely textile, oil refinery, glass sheet, paper, bricks and agro based industry. He is associated with many social welfare organizations. He carried forward his father business from 1976.
Mr. Md. Nurul Alam Mohd. Nurul Alam, Son of Late Hajee Ahmed Hossain, the sponsor director of the Company was completed graduation from Chittagong University. After completion of his education he was engaged with the industry and by dint of his excellent performance and experience he became the key person of the Company. He has gained wide experience and knowledge in modern technology, production and marketing & management techniques of textile industry. Having about 25 years’ experience in the business, he has contributed a significant value to the organization. He is also associated with many social welfare organizations.
Mr. Md. Khurshed Alam
Mohd. Khurshed Alam, Son of Late Mohd. Elias, the sponsor director of the Company, joined the business after completion of his education form Chittagong University. He gathered knowledge relating to modern technology production and management technique through attending several courses. He has contributed greatly in the development of the Company.
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Mohd. Rezaul karim- Director & Managing Director Mohd. Rezaul Karim, Son of Late Hajee Ahmed Hossain, was born on 1st December, 1971. The Managing Director of the Company graduated from Chittagong University. After completion of his education he was engaged with the industry and by dint of his excellent performance and experience, he became the key person of the Company. He has gained wide experience and knowledge in modern technology, production, and marketing & management techniques of textile industry. He is also associated with many social welfare organizations.
Mr. Md. Morshedul Alam
Mohd. Murshed Alam, Son of Late Mohd. Elias, graduated from Chittagong University. He has contributed greatly in the development of the Company. He is engaged in various social activities throughout the country.
Mr. Md. Aminul Karim
Mohd. Aminul Karim, Son of Late Hajee Ahmed Hossain, the Sponsor Director of the Company involved himself in trading business just after completion of his education from Chittagong University. He contributed to the Company through strong leadership and knowledge in textile business.
(g) Capital structure and history of capital raising;
Authorized capital
The Company has authorized capital of Tk. 3,000,000,000 (Tk. Three thousand million) divided by 300,000,000 ordinary Shares of Tk. 10 each.
Issued, Subscribed and paid-up capital
The paid up capital of the Company as on September 30, 2017 is Tk.1,680,000,000 (One thousand six hundred and eighty million) divided by 168,000,000 ordinary shares of face value of Tk. 10 each. The detail capital structure is given below:
Authorized Capital 300,000,000 shares @ Tk. 10 each 3,000,000,000
Issued, Subscribed and Paid up Capital of 168,000,000 Ordinary Shares @ Tk. 10 each in full in cash and other than cash
Allotments for Cash Consideration
At the time of incorporation as on August 01, 2002 500,000
Issued as on April 14, 2005 20,000,000
Issued as on March 22, 2010 9,500,000
Issued as on March 29, 2010 70,000,000
Issued as on November 24, 2011 89,000,000
Issued as on November 27, 2011 36,500,000
Issued as on January 02, 2012 474,500,000
Sub Total (A) 700,000,000
Allotments Other Than Cash
Bonus Share Issue on November 20, 2011 800,000,000
Bonus Share Issue on December 22, 2013 180,000,000
Sub Total (B) 980,000,000
Grand Total C=(A+B) 1,680,000,000
Paid up capital before and after the public issue
Particulars of paid up capital No. of ordinary shares Amount in Taka
Before Initial Public Offer 168,000,000 1,680,000,000
*Initial Public Offer (IPO) under Fixed Price Method (Subject to the approval of regulatory authority)
25,000,000 250,000,000
After Initial Public Offer paid up capital would be (Subject to the approval of regulatory authority)
193,000,000 1,930,000,000
(h) Summary of valuation report of securities
Sl. Method used BDT
Method-1 A) Net Asset Value (NAV) per share with revaluation 22.34
B) Net Asset Value (NAV) per share without revaluation 13.70
Method-2 Earnings based value per share 11.11
Method-3 Average market price of similar stock based valuation 8.34
The detail valuation report is given at “Valuation report of securities prepared by the Issue Manager” under CHAPTER- XV (i) Others-N/A
22
CHAPTER – II CONDITIONS IMPOSED BY THE COMMISSION IN THE CONSENT LETTER
23
DISCLOSURE IN RESPECT OF ISSUANCE OF SECURITY IN DEMAT FORM:
As per provision of the Depository Act, 1999 and regulation made there under, shares will be issued in dematerialized condition. All transfer/transmission/splitting will take place in the Central Depository Bangladesh Ltd. (CDBL) system and any further issuance of shares (rights/bonus) will be issued in dematerialized form only.
(To be finalized after receiving of BSEC final Consent Letter)
CONDITIONS UNDER 2CC OF THE SECURITIES AND EXCHANGE ORDINANCE, 1969:
PART–A
1. The Company shall go for Initial Public Offer (IPO) for 2,50,00,000 ordinary shares of Tk. 10.00 each at par totaling to Tk. 250,000,000 (Taka Twenty five crore) only following the Securities and Exchange Ordinance, 1969, the Bangladesh Securities and Exchange Commission (Public Issue) Rules, 2015, the Depository Act, 1999 and rules made there under.
2. The abridged version of the prospectus, as approved by the Commission, shall be published by the issuer in 4 (Four) national daily newspapers (two in Bangla and two in English), within 02 (two) working days of issuance of this consent letter. The issuer shall post the full prospectus, vetted by Commission, in the issuer’s website and shall also put on the websites of the Commission, stock exchanges, and the issue manager, within 3 (three) working days from the date of issuance of this letter and shall remain posted till the closure of the subscription list. The issuer shall submit to the Commission, the stock exchanges and the issue manager a diskette containing the text of the vetted prospectus in “MS -Word” format.
3. The company shall submit 40 (Forty) copies of the printed prospectus to the Commission for official record within 5
(Five) working days from the date of publication of the abridged version of the prospectus in the newspaper.
4. The issuer company and the issue manager shall ensure transmission of the prospectus and its abridged version for NRBs through email to the Bangladesh Embassies and Missions abroad within 5 (Five) working days from the date of publication of the abridged version of the prospectus in the newspaper. A compliance report shall be submitted in this respect to the Commission jointly by the issuer and the Issue Manager within 02 (Two) working days from the date of said transmission of the prospectus.
5. The following declaration shall be made by the company in the prospectus, namely: -
“Declaration about Listing of Shares with the stock exchange (s):
None of the stock exchange(s), if for any reason, grants listing within 75 (Seventy Five) days from the closure of subscription, any allotment in terms of this prospectus shall be void and the company shall refund the subscription money within 15 (Fifteen) days from the date of refusal for listing by the stock exchanges, or from the date of expiry of the said 75 (Seventy Five) days, as the case may be.
In case of non-refund of the subscription money within the aforesaid 15 (Fifteen) days, the Directors of the company, in addition to the issuer company, shall be collectively and severally liable for refund of the subscription money, with interest at the rate of 2% (two percent) above the bank rate, to the subscribers concerned.
The issue manager, in addition to the issuer company, shall ensure due compliance of the above mentioned conditions and shall submit compliance report thereon to the Commission within 07 (Seven) days of expiry of the aforesaid 15 (Fifteen) days’ time period allowed for refund of the subscription money.”
6. All applicants shall apply for minimum market lot of 500 shares worth Taka 5,000/- (Taka five thousand only) or its
multiples.
7. The IPO shall stand cancelled in case of under-subscription in any category above 35%. In such an event, the issuer and issue manger shall inform the Commission within 2 (two) working days and release the subscription money within 10 (ten) working days after receiving verification report from CDBL and the information from exchanges regarding subscription.
8. 20% of the securities reserved for other general public shall be reserved for ¶wZMÖ¯’ ¶z`ª wewb‡qvMKvix. In case of under-
subscription under any of sub-categories of eligible investor’s category or general public category, the unsubscribed portion shall be added to other sub-category of the same category. In case of over subscription in the general public category, the issuer and the issue manager shall jointly conduct an open lottery. In case of over subscription in the eligible investor’s category, securities shall be allotted on pro-rata basis. No eligible investors shall apply for more than 2% (two percent) of the total securities reserved for the eligible investors.
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9. An applicant cannot submit more than two applications, one in his/her own name and the other jointly with another person. In case, an applicant submits more than two applications, all applications will be treated as invalid and will not be considered for allotment purpose. In addition, 15% (fifteen) of the application money will be forfeited by the Commission and the balance amount will be refunded to the applicant.
10. The applicants who have applied for more than two applications using same bank account, their application will not be considered for lottery and the Commission will forfeit 15% of their subscription money.
11. Making of any false statement in the application or supplying of incorrect information therein or suppressing any relevant information in the application shall make the application liable to rejection and subject to forfeiture of 25% of the application money and/or forfeiture of share (unit) before or after issuance of the same by the issuer. The said forfeited application money or share (unit) will be deposited in account of the Bangladesh Securities and Exchange Commission (BSEC). This is in addition to any other penalties as may be provided for by the law.
12. The company shall furnish the list of allotees to the Commission and the stock exchange(s) simultaneously in which
the shares will be listed, within 24 (Twenty Four) hours of allotment.
13. Shares not allotted at the time of according this consent, but allotted after listing, in favor of sponsors, directors or shareholders having 5% or more shares through stock dividends, shall be subject to a lock-in period of 02 (two) years from the date of issuance of the prospectus.
14. If any share of Sponsors/Directors/Promoters is in paper format, it shall be handed over to securities custodian registered with the Commission and shall remain held till completion of lock-in period and the name of the securities custodian shall be furnished to the Commission jointly by the issuer and issue manager, along with a confirmation thereof from the custodian, within one week of listing of the shares with the stock exchange(s). Or they (shares of Sponsors/ Directors/ Promoters) can be demated and shall remain in lock-in under CDBL system and issuer shall submit a dematerialization confirmation report generated by CDBL and attested by Managing Director of the company along with the lock-in confirmation to the Commission within one week of listing of the shares with the stock exchange(s). In respect of shares other than Sponsors/Directors/Promoters the issuer will ensure their lock-in of those shares and submit a statement to this effect to the Commission.
15. The company shall not declare any dividend/bonus shares before listing of its capital with any Exchange from the date of this consent for raising of capital.
16. The company shall not engage itself into any merger/amalgamation or acquisition activities without taking “No Objection” from the Commission, on the scheme of the said merger/amalgamation or acquisition, as recommended by the Board of Directors, before approval by the shareholders in General Meeting.
PART–B Application Process Step-1 (Applicant) 1. An applicant for public issue of securities shall submit application/buy instruction to the Stockbroker/ Merchant
Banker where the applicant maintains customer account, within the cut-off date (i.e. the subscription closing date), which shall be the 25th (twenty fifth) working day from the date of publication of abridged version of prospectus.
2. The application/buy instruction may be submitted in prescribed paper or electronic form, which shall contain the Customer ID, Name, BO Account Number, Number of Securities applied for, Total Amount and Category of the Applicant. At the same time:
a. Other than non-resident Bangladeshi (NRB) and Foreign applicants shall make the application money and service charge available in respective customer account maintained with the Stockbroker/Merchant Banker. No margin facility, advance or deferred payment is permissible for this purpose. In case the application is made through a margin account, the application money shall be deposited separately and the Stockbroker/Merchant Banker shall keep the amount segregated from the margin account, which shall be refundable to the applicant, if become unsuccessful.
b. Non-resident Bangladeshi (NRB) and Foreign applicants shall submit bank drafts (FDD), issued in favor of the Issuer for an amount equivalent to the application money, with their application to the concerned Stockbroker/Merchant Banker. A Non-resident Bangladeshi (NRB) and Foreign applicant may also submit a single draft against 02(two) applications made by him/her, i.e. one in his/her own name and the other jointly with another person. The draft (FDD) shall be issued by the Bank where the applicant maintains Foreign Currency account debiting the same account and provide the customer with a certificate mentioning the FC account number which has been debited to issue the FDD. The applicant shall also submit the certificate with their application. No banker shall issue more than two drafts from any Foreign Currency
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account for any public issue. At the same time, the applicant shall make the service charge available in respective customer account maintained with the Stockbroker/Merchant Banker.
c. Eligible investors shall submit application through the electronic subscription system of the exchange(s) and deposit the full amount intended to subscribe by the method as determined by the exchange(s).
Step-2 (Intermediary) 3. The Stockbroker/Merchant Banker shall maintain a separate bank account only for this purpose namely “Public Issue
Application Account”. The Stockbroker/Merchant Banker shall:
a. post the amount separately in the customer account (other than NRB and Foreign applicants), and upon availability of fund, block the amount equivalent to the application money;
b. accumulate all the application/buy instructions received up to the cut-off date, deposit the amount in the “Public Issue Application Account” maintained with its bank within the first banking hour of next working day of the cut-off date;
c. instruct the banker to block the account for an amount equivalent to the aggregate application money and to issue a certificate in this regard.
4. Banker of the Stockbroker/Merchant Banker shall block the account as requested for, issue a certificate confirming the same and handover it to the respective Stockbroker/Merchant Banker.
5. For Non-resident Bangladeshi (NRB) and Foreign applicants, the Stockbroker/Merchant Banker shall prepare a list containing the draft information against the respective applicant’s particulars.
6. The Stockbroker/Merchant Banker shall prepare category-wise lists of the applicants containing Customer ID, Name, BO Account Number and Number of Securities applied for, and within 03 (three) working days from the cut-off date, send to the respective Exchange, the lists of applicants in electronic (text format with tilde ‘~’ separator) format, the certificate(s) issued by its banker, the drafts and certificates received from Non-resident Bangladeshi (NRB) and Foreign applicants and a copy of the list containing the draft information.
7. On the next working day, the Exchanges shall provide the Issuer with the information received from the Stockbroker/Merchant Bankers, the drafts and certificates submitted by Non-resident Bangladeshi (NRB) and Foreign applicants and the list containing the draft information. Exchanges shall verify and preserve the bankers’ certificates in their custody.
8. The application/buy instructions shall be preserved by the Stockbroker/Merchant Bankers up to 6 months from listing of the securities with exchange.
Step-3 (Issuer) 9. The Issuer shall prepare consolidated list of the applications and send the applicants’ BOIDs in electronic (text) format
in a CDROM to CDBL for verification. The Issuer shall post the consolidated list of applicants on its website and websites of the Exchanges. CDBL shall verify the BOIDs as to whether the BO accounts of the applicants are active or not.
10. On the next working day, CDBL shall provide the Issuer with an updated database of the applicants containing BO Account Number, Name, Addresses, Parents Name, Joint Account and Bank Account information along with the verification report.
11. After receiving verification report and information from CDBL, the Issuer shall scrutinize the applications, prepare category wise consolidated lists of valid and invalid applications and submit report of final status of subscription to the Commission and the Exchanges within 10 (ten) working days from the date of receiving information from the Exchanges.
12. The Issuer and the issue manager shall conduct category wise lottery with the valid applications within 03 (three) working days from the date of reporting to the Commission and the Exchanges, if do not receive any observation from the Commission or the Exchanges.
13. The Issuer and issue manager shall arrange posting the lottery result on their websites within 06 (six) hours and on the websites of the Commission and Exchanges within 12 (twelve) hours of lottery.
14. Within 02 (two) working days of conducting lottery, the Issuer shall:
a) send category wise lists of the successful and unsuccessful applicants in electronic (text format with tilde ‘~’ separator) format to the respective Exchange.
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b) send category wise lists of unsuccessful applicants who are subject to penal provisions as per conditions of the Consent Letter issued by the Commission in electronic (text format with tilde ‘~’ separator) format to the Commission and Exchanges mentioning the penalty amount against each applicant.
c) issue allotment letters in the names of successful applicants in electronic format with digital signatures and send those to respective Exchange in electronic form.
d) send consolidated allotment data (BOID and number of securities) in electronic text format in a CDROM to CDBL to credit the allotted shares to the respective BO accounts.
Step-4 (Intermediary)
15. On the next working day, Exchanges shall distribute the information and allotment letters to the Stockbroker/Merchant Bankers concerned in electronic format and instruct them to:
a) remit the amount of successful (other than NRB and Foreign) applicants to the Issuer’s respective Escrow Account opened for subscription purpose, and unblock the amount of unsuccessful applicants;
b) send the penalty amount of other than NRB and Foreign applicants who are subject to penal provisions to the Issuer’s respective Escrow Accounts along with a list and unblock the balance application money;
16. On the next working day of receiving the documents from the Exchanges, the Stockbrokers/Merchant Banker shall request its banker to:
a. release the amount blocked for unsuccessful (other than NRB and foreign) applicants;
b. remit the aggregate amount of successful applicants and the penalty amount of unsuccessful applicants (other than NRB and foreign) who are subject to penal provisions to the respective ‘Escrow’ accounts of the Issuer opened for subscription purpose.
17. On the next working day of receiving request from the Stockbrokers/Merchant Bankers, their bankers shall unblock the amount blocked in the account(s) and remit the amount as requested for to the Issuer’s ‘Escrow’ account.
18. Simultaneously, the stockbrokers/Merchant Bankers shall release the application money blocked in the customer accounts; inform the successful applicants about allotment of securities and the unsuccessful applicants about releasing their blocked amounts and send documents to the Exchange evidencing details of the remittances made to the respective ‘Escrow’ accounts of the Issuer. The unblocked amounts of unsuccessful applicants shall be placed as per their instructions. The Stockbroker/Merchant Banker shall be entitled to recover the withdrawal charges, if any, from the applicant who wants to withdraw the application money, up to an amount of Tk. 5.00 (five) per withdrawal.
19. All drafts submitted by NRB or Foreign applicants shall be deposited in the Issuer’s respective ‘Escrow’ accounts and refund shall be made by the Issuer by refund warrants through concerned stockbroker or merchant banker or transfer to the applicant’s bank account (FC account which has been debited to apply by NRB or foreign applicants) through banking channel within 10 (ten) working days from the date of lottery.
Miscellaneous:
20. The Issuer, Issue Manager, Stockbrokers and Merchant Bankers shall ensure compliance of the above.
21. The bank drafts (FDD) shall be issued considering TT Clean exchange rate of Sonali Bank Ltd. on the date of publication of abridged version of prospectus.
22. Amount deposited and blocked in the “Public Issue Application Account” shall not be withdrawn or transferred during the blocking period. Amount deposited by the applicants shall not be used by the Stockbrokers/Merchant Bankers for any purpose other than public issue application.
23. The Issuer shall pay the costs related to data transmission, if claimed by the Exchange concerned up to an amount of Tk.2,00,000.00 (taka two lac) for a public issue.
24. The Stockbroker/Merchant Bankers shall be entitled to a service charge of Tk.5.00 (taka five) only per application irrespective of the amount or category. The service charge shall be paid by the applicant at the time of submitting application.
25. The Stockbroker/Merchant Banker shall provide the Issuer with a statement of the remittance and drafts sent.
26. The Issuer shall accumulate the penalty amount recovered and send it to the Commission through a bank draft/payment order issued in favor of the Bangladesh Securities and Exchange Commission.
27. The concerned Exchange are authorized to settle any complaints and take necessary actions against any Stockbroker/Merchant Banker in case of violation of any provision of the public issue application process with intimation to the Commission.
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CHAPTER – III DECLARATION AND DUE DILIGENCE CERTIFICATES
28
Annexure-A
Declaration about the responsibility of the directors, including the CEO of the issuer in respect of the prospectus
[See rule 4 (1)(d)]
This prospectus has been prepared, seen and approved by us, and we, individually and collectively, accept full responsibility for the authenticity, accuracy and adequacy of the statements made, information given in the prospectus, documents, financial statements, exhibits, annexes, papers submitted to the Commission in support thereof, and confirm, after making all reasonable inquiries that all conditions concerning this public issue and prospectus have been met and that there are no other information or documents, the omission of which make any information or statements therein misleading for which the Commission may take any civil, criminal or administrative actions against any or all of us as it may deem fit.
We also confirm that full and fair disclosures have been made in this prospectus to enable the investors to make a well informed decision for investment.
Sd/- Sydul Karim
Chairman
Sd/- Mohd. Rezaul Karim
Director & Managing Director
Sd/- Mohd. Asfak Hossain
Director
Sd/- Mohd. Asrar Hossain
Director
Sd/- Mohd. Abrar Hossain
Director
Sd/- Md. Golam Moin Uddin Chowdhury
Independent Director
Sd/-
Mohd. Eradat Ullah, FCA Independent Director
Place: Chittagong Date: 20.12.2017
29
Annexure-B Due diligence certificate by issue manager
[Rule 4 (1)(d)] To The Bangladesh Securities and Exchange Commission Sub: Public Issue of 25,000,000 Ordinary Shares of Tk. 250,000,000 by Mohammed Elias Brothers POY Manufacturing Plant Limited. Dear Sir, We, the issue manager(s) to the above-mentioned forthcoming issue, state and confirm as follows: (1) We have examined all the documents submitted with the application for the above mentioned public issue, visited the
premises of the issuer and interviewed the Chairperson, Directors and key management personnel of the issuer in connection with the finalization of the prospectus pertaining to the said issue;
(2) On the basis of such examination and the discussions with the Directors, Officers and Auditors of the Issuer, other agencies, independent verification of the statements concerning objects of the issue and the contents of the documents and other materials furnished by the Issuer.
WE CONFIRM THAT: (a) The prospectus filed with the Commission is in conformity with the documents, materials and papers relevant to the
issue; (b) All the legal requirements relating to the issue as also in the rules, notification, guidelines, instructions, etc. framed/issued
by the Commission, other competent authorities in this behalf and the Government have been duly complied with;
(c) The disclosures made in prospectus are true, fair and adequate to enable the investors to make a well informed decision for investment in the proposed issue and such disclosures are in accordance with the requirements of the Companies Act, 1994, the Bangladesh Securities and Exchange Commission (Public Issue) Rules, 2015 and other applicable laws;
(d) Besides ourselves, all the intermediaries named in the prospectus are registered with the Commission and that till date such registrations are valid;
(e) We have satisfied ourselves about the capability of the underwriters to fulfill their underwriting commitments;
(f) The proposed activities of the issuer for which the funds are being raised in the present issue fall within the ‘main objects’ listed in the object clause of the Memorandum of Association or other charter of the issuer and that the activities which have been carried out till now are valid in terms of the object clause of its Memorandum of Association;
(g) Necessary arrangements have been made to ensure that the moneys to be received pursuant to the issue shall be kept in a separate bank account and shall be used for the purposes disclosed in the use of proceeds section of the prospectus;
(h) All the applicable disclosures mandated in the Bangladesh Securities and Exchange Commission (Public Issue) Rules, 2015 have been made in addition to other disclosures which, in our view, are fair and adequate to enable the investor to make a well informed decision;
(i) We enclose a note explaining how the process of due diligence has been exercised by us in view of the nature of current business background or the issuer, situation at which the proposed business stands, the risk factors, sponsors experiences etc. We also confirm that the due diligence related process, documents and approval memos shall be kept in record by us for the next 5 (five) years after the IPO for any further inspection by the Commission;
(j) We enclose a checklist confirming rule-wise compliance with the applicable provisions of the Bangladesh Securities and Exchange Commission (Public Issue) Rules, 2015 containing details such as the rule number, its text, the status of compliance, page numbers of the prospectus where the rules have been complied with and our comments, if any;
30
(k) We also declare that we have managed the public issue of following issuers in the last 05 (five) years:
Serial No. Issue Month/Year Issue Price Dividend Payment
History
1. Nil (2013) N/A N/A
2. Western Marine Shipyard Limited (2014) TK. 35.00 2014: 5.00, 10%B
2015: 10%B 2016: 12%B
3. Nil (2015) N/A N/A
4. Bangladesh National Insurance Company Limited (2016)
Tk. 10.00 2016: 10%
5. Nil (2017) N/A N/A
For Manager to the issue:
Sd/- M. Mosharraf Hossain FCA, PhD
Place: Dhaka Managing Director & CEO Date: 08 January 2018 Prime Finance Capital Management Limited
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Annexure-B
DUE DILIGENCE CERTIFICATE BY ISSUE MANAGER
[Rule 4 (1)(d)] To The Bangladesh Securities and Exchange Commission
Sub: Public issue of 25,000,000 ordinary shares of BDT 10.00 at par totaling BDT 250,000,000.00 of Mohammed Elias Brothers POY Manufacturing Plant Limited
Dear Sir,
We, the issue manager(s) to the above-mentioned forthcoming issue, state and confirm as follows:
(1) We have examined all the documents submitted with the application for the above mentioned public issue, visited the premises of the issuer and interviewed the Chairperson, Directors and key management personnel of the issuer in connection with the finalization of the prospectus pertaining to the said issue;
(2) On the basis of such examination and the discussions with the directors, officers and auditors of the issuer, other agencies, independent verification of the statements concerning objects of the issue and the contents of the documents and other materials furnished by the issuer.
WE CONFIRM THAT:
(a) The prospectus filed with the Commission is in conformity with the documents, materials and papers relevant to the issue;
(b) All the legal requirements relating to the issue as also in the rules, notification, guidelines, instructions, etc. framed/issued by the Commission, other competent authorities in this behalf and the Government have been duly complied with;
(c) The disclosures made in prospectus are true, fair and adequate to enable the investors to make a well informed decision for investment in the proposed issue and such disclosures are in accordance with the requirements of the Companies Act, 1994, the Bangladesh Securities and Exchange Commission (Public Issue) Rules, 2015 and other applicable laws;
(d) Besides ourselves, all the intermediaries named in the prospectus are registered with the Commission and that till date such registrations are valid;
(e) We have satisfied ourselves about the capability of the underwriters to fulfill their underwriting commitments; (f) The proposed activities of the issuer for which the funds are being raised in the present issue fall within the ‘main objects’
listed in the object clause of the Memorandum of Association or other charter of the issuer and that the activities which have been carried out till now are valid in terms of the object clause of its Memorandum of Association;
(g) Necessary arrangements have been made to ensure that the moneys to be received pursuant to the issue shall be kept in a separate bank account and shall be used for the purposes disclosed in the use of proceeds section of the prospectus;
(h) All the applicable disclosures mandated in the Bangladesh Securities and Exchange Commission (Public Issue) Rules, 2015 have been made in addition to other disclosures which, in our view, are fair and adequate to enable the investor to make a well informed decision;
(i) We enclose a note explaining how the process of due diligence has been exercised by us in view of the nature of current business background or the issuer, situation at which the proposed business stands, the risk factors, sponsors experiences etc. We also confirm that the due diligence related process, documents and approval memos shall be kept in record by us for the next 5 (five) years after the IPO for any further inspection by the Commission;
(j) We enclose a checklist confirming rule-wise compliance with the applicable provisions of the Bangladesh Securities and Exchange Commission (Public Issue) Rules, 2015 containing details such as the rule number, its text, the status of compliance, page numbers of the prospectus where the rules has been complied with and our comments, if any;
(k) We also declare that we have not managed the public issue in the last 05 (five) years:
Place: Dhaka Date: January 8, 2018
Sd/- Muhammad Husain Ahmad Faruqi
Chief Executive Officer AIBL Capital Management Limited
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Annexure-B
DUE DILIGENCE CERTIFICATE BY ISSUE MANAGER
(AB INVESTMENT LIMITED)
[Rule 4 (1)(d)]
To
The Bangladesh Securities and Exchange Commission
Sub: Public Issue of 25,000,000 Ordinary Shares of BDT 10.00 at par totaling BDT 250,000,000.00 by Mohammed Elias
Brothers POY Manufacturing Plant Limited
Dear Sir,
We, the issue manager(s) to the above-mentioned forthcoming issue, state and confirm as follows:
(1) We have examined all the documents submitted with the application for the above mentioned public issue, visited the
premises of the issuer and interviewed the Chairperson, Directors and key management personnel of the issuer in
connection with the finalization of the prospectus pertaining to the said issue;
(2) On the basis of such examination and the discussions with the directors, officers and auditors of the issuer, other
agencies, independent verification of the statements concerning objects of the issue and the contents of the documents
and other materials furnished by the issuer.
WE CONFIRM THAT:
(a) The prospectus filed with the Commission is in conformity with the documents, materials and papers relevant to the
issue;
(b) All the legal requirements relating to the issue as also in the rules, notification, guidelines, instructions, etc.
framed/issued by the Commission, other competent authorities in this behalf and the Government have been duly
complied with;
(c) The disclosures made in prospectus are true, fair and adequate to enable the investors to make a well informed decision
for investment in the proposed issue and such disclosures are in accordance with the requirements of the Companies
Act, 1994, the Bangladesh Securities and Exchange Commission (Public Issue) Rules, 2015 and other applicable laws;
(d) Besides ourselves, all the intermediaries named in the prospectus are registered with the Commission and that till date
such registrations are valid;
(e) We have satisfied ourselves about the capability of the underwriters to fulfill their underwriting commitments;
(f) The proposed activities of the issuer for which the funds are being raised in the present issue fall within the ‘main objects’
listed in the object clause of the Memorandum of Association or other charter of the issuer and that the activities which
have been carried out till now are valid in terms of the object clause of its Memorandum of Association;
(g) Necessary arrangements have been made to ensure that the moneys to be received pursuant to the issue shall be kept in
a separate bank account and shall be used for the purposes disclosed in the use of proceeds section of the prospectus;
(h) All the applicable disclosures mandated in the Bangladesh Securities and Exchange Commission (Public Issue) Rules,
2015 have been made in addition to other disclosures which, in our view, are fair and adequate to enable the investor to
make a well informed decision;
(i) We enclose a note explaining how the process of due diligence has been exercised by us in view of the nature of current
business background or the issuer, situation at which the proposed business stands, the risk factors, sponsors experiences
etc. We also confirm that the due diligence related process, documents and approval memos shall be kept in record by
us for the next 5 (five) years after the IPO for any further inspection by the Commission;
(j) We enclose a checklist confirming rule-wise compliance with the applicable provisions of the Bangladesh Securities and
Exchange Commission (Public Issue) Rules, 2015 containing details such as the rule number, its text, the status of
compliance, page numbers of the prospectus where the rules has been complied with and our comments, if any;
(k) We also declare that we have managed no public issue in the last 05 (five) years.
Place: Dhaka
Date: January 8, 2018
Sd/- Chief Executive Officer
AB Investment Limited
33
Annexure –C Due Diligence Certificate by the Underwriter(s)
[Rule 4 (1) (d)]
To The Bangladesh Securities and Exchange Commission
Sub: Public Offer of 25,000,000 ordinary shares of TK. 250,000,000/- of Mohammed Elias Brothers POY Manufacturing Plant Limited
Dear Sir,
We, the under-noted Underwriter(s) to the above-mentioned forthcoming issue, state individually and collectively as follows: 1. We, while underwriting the above mentioned issue on a firm commitment basis, have examined the draft prospectus,
other documents and materials as relevant to our underwriting decision; and 2. On the basis of such examination and the discussions with the issuer company, its directors and officers, and other
agencies, independent verification of the statements concerning objects of the issue and the contents of the documents and other materials furnished by the issuer company.
WE CONFIRM THAT:
a) We are registered with the Bangladesh Securities and Exchange Commission as a merchant banker and eligible to carry out the underwriting activities. Our present paid-up capital stands at Tk. 2,032,800,000 (Taka two billion thirty two million eight hundred thousand only) and we have the capacity to underwrite a total amount of Tk. 10,068,719,220 (Taka ten billion sixty eight million seven hundred nineteen thousand two hundred and twenty only) as per relevant legal requirements. We have committed to underwrite for up to BDT 16,000,000 (Taka Sixteen Million only) for the upcoming issue.
b) At present, the following underwriting obligations are pending for us:
Sl. No. Name of The Company Amount Underwritten (Taka)
1 Royal Denim Limited 5,500,000
2 M.L Dyeing Limited 100,000,000
3 Rupsha Fish & Allied Industries Limited 25,000,000
4 GQ Ball Pen Industries Limited 50,100,000
5 IFCO Garments & Textiles Limited 17,500,000
6 VFS Thread Dyeing Limited 40,000,000
7 Dhaka Regency Hotel Limited 10,500,000
8 Bashundhara Paper Mills Limited 50,000,000
9 Delta Hospital Limited 71,000,000
10 Esquire Knit Composite Limited 145,000,000
11 Energypac Power Generation Limited 15,000,000
12 Ratanpur Steel Re-Rolling Mills Limited 50,000,000
13 Desh General Insurance Company Limited 28,000,000
Total 607,600,000
c) All information as are relevant to our underwriting decision have been received by us and the draft prospectus forwarded to the Commission has been approved by us;
d) We shall subscribe and take up the un-subscribed securities against the above-mentioned public issue within 15 (fifteen) days of calling up thereof by the issuer; and
e) This underwriting commitment is unequivocal and irrevocable.
For the Underwriter: Sd/- M. Mosharraf Hossain, FCA, PhD
Managing Director & CEO Prime Finance Capital Management Ltd. Date: 08/01/ 2018
34
Annexure -C DUE DILIGENCE CERTIFICATE BY THE UNDERWRITER
[Rule 4 (1)(d)]
To The Bangladesh Securities and Exchange Commission
Sub: Public Offer of 25,000,000 ordinary shares of TK. 250,000,000/- of Mohammed Elias Brothers POY Manufacturing Plant Limited
Dear Sir,
We, the under-noted Underwriter(s) to the above-mentioned forthcoming issue, state individually and collectively as follows: 3. We, while underwriting the above mentioned issue on a firm commitment basis, have examined the draft prospectus,
other documents and materials as relevant to our underwriting decision; and 4. On the basis of such examination and the discussions with the issuer company, its directors and officers, and other
agencies, independent verification of the statements concerning objects of the issue and the contents of the documents and other materials furnished by the issuer company.
WE CONFIRM THAT: f) We are registered with the Bangladesh Securities and Exchange Commission as a merchant banker and eligible to
carry out the underwriting activities. Our present paid-up capital stands at Tk.500,000,000 (Taka Fifty Crore only) and we have the capacity to underwrite a total amount of Tk. 2,500,000,000 (Taka Two Hundred and Fifty Crore Only) as per relevant legal requirements. We have committed to underwrite for up to Tk. 16,000,000.00(Taka One Crore and Sixty Lac only) for the upcoming issue.
g) At present, the following underwriting obligations are pending for us:
Sl. Name of the Company Underwritten (in BDT)
1 Nahee Aluminum Composite Panel Ltd. 22,500,000.00
2 New Line Clothings Limited 45,000,000.00
3 Ratanpur Steel Re-Rolling Mills Ltd. 50,000,000.00
4 Silva Pharmaceuticals Limited 25,000,000.00
Total 142,500,000.00
h) All information as are relevant to our underwriting decision have been received by us and the draft prospectus forwarded to the Commission has been approved by us;
i) We shall subscribe and take up the un-subscribed securities against the above-mentioned public issue within 15 (fifteen) days of calling up thereof by the issuer; and
j) This underwriting commitment is unequivocal and irrevocable. For the Underwriter:
Sd/- Muhammad Husain Ahmad Faruqi Chief Executive Officer AIBL Capital Management Limited
Place: Dhaka Date: January 04, 2018
35
Annexure -C DUE DILIGENCE CERTIFICATE BY THE UNDERWRITER
[Rule 4 (1)(d)]
To The Bangladesh Securities and Exchange Commission
Sub: Public Offer of 25,000,000 ordinary shares of TK. 250,000,000/- of Mohammed Elias Brothers POY Manufacturing Plant Limited
Dear Sir,
We, the under-noted Underwriter(s) to the above-mentioned forthcoming issue, state individually and collectively as follows:
5. We, while underwriting the above mentioned issue on a firm commitment basis, have examined the draft prospectus, other documents and materials as relevant to our underwriting decision; and
6. On the basis of such examination and the discussions with the issuer company, its directors and officers, and other agencies, independent verification of the statements concerning objects of the issue and the contents of the documents and other materials furnished by the issuer company.
WE CONFIRM THAT:
k) We are registered with the Bangladesh Securities and Exchange Commission as a merchant banker and eligible to carry out the underwriting activities. Our present paid-up capital stands at Tk 6150,000,000 (Taka Six hundred Fifteen crore only) and we have the capacity to underwrite a total amount of Tk.30,750,000,000 (Taka Three Thousand seventy five crore Only) as per relevant legal requirements. We have committed to underwrite for up to Tk. 14,000,000(Taka One Crore forty lac only) for the upcoming issue.
l) At present, the following underwriting obligations are pending for us:
Sl. Name of the Company Underwritten (in BDT)
1 Esquire Knit Composite Limited 20,000,000
Total 20,000,000
m) All information as are relevant to our underwriting decision have been received by us and the draft prospectus forwarded to the Commission has been approved by us;
n) We shall subscribe and take up the un-subscribed securities against the above-mentioned public issue within 15
(fifteen) days of calling up thereof by the issuer; and
o) This underwriting commitment is unequivocal and irrevocable. For the Underwriter: Sd/-
Sheikh Ashraful Haque
Chief Executive Officer AB Investment Limited Place: Dhaka Date: January 4, 2018
36
Annexure -C
DUE DILIGENCE CERTIFICATE BY THE UNDERWRITER
[Rule 4 (1)(d)]
To The Bangladesh Securities and Exchange Commission Sub: Public Offer of 25,000,000 Ordinary Shares of Tk. 250,000,000 (Taka Two hundred and fifty million) only of Mohammed
Elias Brothers POY Manufacturing Plant Limited. Dear Sir, We, the under-noted Underwriter(s) to the above-mentioned forthcoming issue, state individually and collectively as follows: (1) We, while underwriting the above mentioned issue on a firm commitment basis, have examined the draft prospectus,
other documents and materials as relevant to our underwriting decision; and (2) On the basis of such examination and the discussions with the issuer company, its directors and officers, and other
agencies, independent verification of the statements concerning objects of the issue and the contents of the documents and other materials furnished by the issuer company.
WE CONFIRM THAT:
(a) We are registered with the Bangladesh Securities and Exchange Commission as a merchant banker and eligible to carry out the underwriting activities. Our present paid-up capital stands at Tk. 131.86 (One hundred thirty one point eight six) crore and we have the capacity to underwrite a total amount of Tk. 1179.30 (One thousand one hundred seventy nine point three zero) crore as per relevant legal requirements. We have committed to underwrite for up to Tk. 1.00 (One point zero zero) crore for the upcoming issue.
(b) At present, the following underwriting obligations are pending for us:
Sl. Name of the company Amount Underwritten (In Tk.)
1 STS Holdings Limited 60,900,000.00
2 Dhaka Regency Hotel & Resorts Limited 52,500,000.00
3 Aman Cotton Fibrous Limited 20,000,000.00
4 Delta Hospital Limited 16,000,000.00
5 ADN Telecom Limited 199,500,000.00
6 Desh General Insurance Company Ltd. 5,600,000.00
7 Esquire Knit Composit Ltd. 40,000,000.00
8 Energypac Power Generation Ltd. 42,500,000.00
9 Ratanpur Steel Re-Rolling Mills Ltd. 50,000,000.00
10 AB Bank Ltd. 750,000,000.00
Total 1,237,000,000.00
(c) All information as are relevant to our underwriting decision have been received by us and the draft prospectus forwarded to the Commission has been approved by us;
(d) We shall subscribe and take up the un-subscribed securities against the above-mentioned public issue within 15 (fifteen) days of calling up thereof by the issuer; and
(e) This underwriting commitment is unequivocal and irrevocable. For the Underwriter: Sd/- Md. Sohel Rahman Chief Executive Officer (Additional Charge) ICB Capital Management Limited Date: 07 January, 2018
37
Annexure -C
Due diligence certificate by the underwriter [Rule 4 (1)(d)]
To
The Bangladesh Securities and Exchange Commission
Sub: Public offer of 25,000,000 Ordinary Shares of Tk. 250,000,000 of Mohammed Elias Brothers POY Manufacturing Plant Limited.
Dear Sir,
We, the under-noted Underwriter(s) to the above-mentioned forthcoming issue, state individually and collectively as follows:
(1) We, while underwriting the above mentioned issue on a firm commitment basis, have examined the draft prospectus, other documents and materials as relevant to our underwriting decision; and
(2) On the basis of such examination and the discussions with the issuer company, its directors and officers, and other agencies, independent verification of the statements concerning objects of the issue and the contents of the documents and other materials furnished by the issuer company.
WE CONFIRM THAT:
(a) We are registered with the Bangladesh Securities and Exchange Commission as a merchant banker and eligible to carry out the underwriting activities. Our present paid-up capital stands at Tk. 250,000,000 (twenty five crore) and we have the capacity to underwrite a total amount of Tk. 1,250,000,000 (Taka one hundred twenty five crore) as per relevant legal requirements. We have committed to underwrite for up to Tk. 3,500,000 (Taka Three and half Million) only for the upcoming issue.
(b) At present, the following underwriting obligations are pending for us:
Sl. No. Name of the Company Amount Underwritten (in Tk.)
1 South Asia Insurance Company Limited 30,000,000.00
2 Lub-rref (Bangladesh) Limited 30,000,000.00
3 Delta Hospital Limited 8,000,000.00
4 Kattali Textile Limited 25,000,000.00
5 Esquire Knit Composite Limited 20,000,000.00
6 Ratanpur Steel Re-Rolling Mills Limited ( Right Issue) 50,000,000.00
7 AB Bank Limited ( Right Issue) 45,000,000.00
Total 208,000,000.00
(c) All information as are relevant to our underwriting decision have been received by us and the draft prospectus forwarded
to the Commission has been approved by us;
(d) We shall subscribe and take up the un-subscribed securities against the above-mentioned public issue within 15 (fifteen) days of calling up thereof by the issuer; and
(e) This underwriting commitment is unequivocal and irrevocable.
For the Underwriter:
Sd/- Mohammed Atiquzzaman Managing Director BetaOne Investments Limited Date: December 28, 2017
38
Annexure - C
DUE DILIGENCE CERTIFICATE BY THE UNDERWRITER [Rule 4 (1) (d)]
To The Bangladesh Securities and Exchange Commission
Sub: Public offer of 25,000,000 Ordinary Shares of Tk. 250,000,000.00 (Taka Twenty five crore) only of Mohammed Elias Brothers POY Manufacturing Plant Limited.
Dear Sir, We, the under-noted Underwriter(s) to the above-mentioned forthcoming issue, state individually and collectively as follows:
7. We, while underwriting the above mentioned issue on a firm commitment basis, have examined the draft prospectus, other documents and materials as relevant to our underwriting decision; and
8. On the basis of such examination and the discussions with the issuer company, its directors and officers, and other agencies, independent verification of the statements concerning objects of the issue and the contents of the documents and other materials furnished by the issuer company.
WE CONFIRM THAT:
p) We are registered with the Bangladesh Securities and Exchange Commission as a merchant banker and eligible to carry out the underwriting activities. Our present paid-up capital stands at Tk. 58,85,00,000.00 (Taka Fifty Eight Crore Eighty Five lac) only and we have the capacity to underwrite a total amount of Tk. 294,42,50,000.00 (Taka Two Ninety Four crore Forty Two lac & Fifty Thousand) only as per relevant legal requirements. We have committed to underwrite for up to Tk. 3,75,00,000.00 (Taka Three crore & Seventy five lac) only for the upcoming issue.
q) At present, the following underwriting obligations are pending for us:
Sl. No. Name of the company Amount underwritten (BDT)
1. Reliance Finance Limited 20,00,00,000.00
2. Summit Shipping Limited 5,25,00,000.00
3. Rupsha Fish & Industries Limited 100,000,000.00
4. Rhymer Chemical Industries Limited 8,00,00,000.00
5. Alliance Holdings Limited 4,23,50,000.00
6. Galaxy Sweater & Yarn Dying Limited 15,00,00,000.00
7. Dhaka Regency Hotel & Resort Limited 5,00,00,000.00
8 S.S Steels(Pvt)Ltd 37,500,000.00
9. AB Bank Limited 180,000,000.00
10. Esquire Knit Composite Limited 2,00,00,000.00
11. Desh General Insurance Company Limited 56,00,000.00
Total 91,79,50,000.00
r) All information as are relevant to our underwriting decision have been received by us and the draft prospectus forwarded to the Commission has been approved by us;
s) We shall subscribe and take up the un-subscribed securities against the above-mentioned public issue within 15 (fifteen) days of calling up thereof by the issuer; and
t) This underwriting commitment is unequivocal and irrevocable. For the Underwriter:
Sd/- Chief Executive Officer First Security Islami Capital & Investment Ltd. Date: 28/12/2017
39
Annexure-C
DUE DILIGENCE CERTIFICATE BY THE UNDERWRITER [Rule 4 (1)(d)]
To The Bangladesh Securities and Exchange Commission
Sub: Public Offer of 25,000,000 ordinary shares of TK. 250,000,000/- of Mohammed Elias Brothers POY Manufacturing Plant Limited
Dear Sir,
We, the under-noted Underwriter(s) to the above-mentioned forthcoming issue, state individually and collectively as follows:
(1) We, while underwriting the above mentioned issue on a firm commitment basis, have examined the draft prospectus, other documents and materials as relevant to our underwriting decision; and
(2) On the basis of such examination and the discussions with the issuer company, its directors and officers, and other agencies, independent verification of the statements concerning objects of the issue and the contents of the documents and other materials furnished by the issuer company.
WE CONFIRM THAT: (a) We are registered with the Bangladesh Securities and Exchange Commission as a merchant banker and eligible to carry
out the underwriting activities. Our present paid-up capital stands at Tk. 250,000,000.00 (Taka Twenty Five Crore) and we have the capacity to underwrite a total amount of Tk.1,250,000,000.00 (Taka One Hundred Twenty Five Crore) as per relevant legal requirements. We have committed to underwrite for up to Tk. 35,00,000.00 (Taka Thirty Five Lac only) for the upcoming issue.
(b) At present, the following underwriting obligations are pending for us:
Sl. Name of the issue Amount underwritten (Tk.)
1 Aftab Hatchery Limited 12,60,00,000.00
2 STS Holdings Limited 2,00,00,000.00
3 Dhaka Regency Hotel & Resort Limited 2,10,00,000.00
4 AB Bank Limited 30,00,00,000.00
5 Indo-Bangla Pharmaceuticals Limited 1,75,00,000.00
6 Popular Pharmaceuticals Limited 1,00,00,000.00
7 Esquire Knit Composite Limited 2,00,00,000.00
8 Delta Hospital Limited 80,00,000.00
9 M. L. Dyeing Limited 3,00,00,000.00
10 Energypac Power Generation Limited 2,50,00,000.00
11 Ashuganj Power Station Company Limited 6,00,00,000.00
12 Lub-rref (Bangladesh) Limited 30,000,000.00
Total 66,75,00,000.00
(c) All information as are relevant to our underwriting decision have been received by us and the draft prospectus forwarded to the Commission has been approved by us;
(d) We shall subscribe and take up the un-subscribed securities against the above-mentioned public issue within 15 (fifteen) days of calling up thereof by the issuer; and
(e) This underwriting commitment is unequivocal and irrevocable.
For the Underwriter:
Sd/- Kamrun Naher Chief Executive Officer NBL Capital and Equity Management Limited
Place: Dhaka Date: December 10, 2017
40
Annexure-C
DUE DILIGENCE CERTIFICATE BY THE UNDERWRITER
[See rule 4 (1)(d)] To The Bangladesh Securities and Exchange Commission
Sub: Public Offer of 25,000,000 Ordinary Shares of Tk. 250,000,000 (Taka Twenty Five Crore) only of Mohammed Elias Brothers POY Manufacturing Plant Limited.
Dear Sir,
We, the under-noted Underwriter(s) to the above-mentioned forthcoming issue, state individually and collectively as follows:
(1) We, while underwriting the above mentioned issue on a firm commitment basis, have examined the draft prospectus, other documents and materials as relevant to our underwriting decision; and
(2) On the basis of such examination and the discussions with the issuer company, its directors and officers, and other agencies, independent verification of the statements concerning objects of the issue and the contents of the documents and other materials furnished by the issuer company.
WE CONFIRM THAT: (a) We are registered with the Bangladesh Securities and Exchange Commission as a merchant banker and eligible to carry out the
underwriting activities. Our present paid-up capital stands at Tk.241,500,000 ( Taka Twenty four core fifteen lac) only and we have the capacity to underwrite a total amount of Tk. 1,207,500,000 ( Taka one hundred twenty core seventy five lac) only as per relevant legal requirements. We have committed to underwrite for up to Tk. 3,500,000 (Taka Thirty Five Lac) only for the upcoming issue.
(b) At present, the following underwriting obligations are pending for us: (Name of issue and amount underwritten)
Sl. No. Name of issue Amount Underwritten (in Taka)
i) Shamsul Alamin Real Estate Limited 7,758,630
ii) Delta Hospital Limited 8,000,000
iii) Esquire Knit Composite Limited 20,000,000
iii) AB Bank Limited 45,000,000
Total 80,758,630
(c) All information as are relevant to our underwriting decision have been received by us and the draft prospectus forwarded to the Commission has been approved by us;
(d) We shall subscribe and take up the un-subscribed securities against the above-mentioned public issue within 15 (fifteen) days of calling up thereof by the issuer; and
(e) This underwriting commitment is unequivocal and irrevocable.
For the Underwriter:
Sd/- Md. Abdul Muktadir, CFA Chief Executive Officer PLFS Investments Limited Date: December 26, 2017
41
Annexure-C DUE DILIGENCE CERTIFICATE BY THE UNDERWRITER
[Rule 4 (1)(d)]
To
The Bangladesh Securities and Exchange Commission
Sub: Public offer of 25,000,000 Ordinary Shares of Tk. 250,000,000 of Mohammad Elias Brothers POY Manufacturing Plant Limited
Dear Sir, We, the under-noted Underwriter(s) to the above-mentioned forthcoming issue, state individually and collectively as follows:
9. We, while underwriting the above mentioned issue on a firm commitment basis, have examined the draft prospectus, other documents and materials as relevant to our underwriting decision; and
10. On the basis of such examination and the discussions with the issuer company, its directors and officers, and other
agencies, independent verification of the statements concerning objects of the issue and the contents of the documents and other materials furnished by the issuer company.
WE CONFIRM THAT:
u) We are registered with the Bangladesh Securities and Exchange Commission as a merchant banker and eligible to carry out the underwriting activities. Our present paid-up capital stands at Tk. 550,00,00,000.00 (Taka five hundred and fifty crore) only and we have the capacity to underwrite a total amount of Tk. 2750,00,00,000.00 (Taka two thousand seven hundred and fifty crore) only as per relevant legal requirements. We have committed to underwrite for up to Tk. 35,00,000.00 (Taka thirty five lac) only for the upcoming issue.
v) At present, the following underwriting obligations are pending for us:
w) All information as are relevant to our underwriting decision have been received by us and the draft prospectus
forwarded to the Commission has been approved by us;
x) We shall subscribe and take up the un-subscribed securities against the above-mentioned public issue within 15 (fifteen) days of calling up thereof by the issuer; and
y) This underwriting commitment is unequivocal and irrevocable.
For the Underwriter: Sd/- Air Cdre ( Retd) Md Abu Bakar, FCA
Managing Director (CC) Southeast Bank Capital Services Limited
Place: Dhaka Date: January 1, 2018
Sl. No. Name of the Company Amount of Underwritten (in BDT)
01 Express Insurance Limited 5,73,25,000.00
02 Bashundhara Paper Mills Limited 5,00,00,000.00
03 Dhaka Regency Hotel Limited 2,50,00,000.00
04 Esquire Knit Composite Limited 2,00,00,000.00
05 Lub-rref (Bangladesh) Limited 20,00,00,000.00
06 New Line Clothing Limited 3,00,00,000.00
07 AB Bank Limited 18,00,00,000.00
Total 56,23,25,000.00
42
Annexure-C DUE DILIGENCE CERTIFICATE OF THE UNDERWRITER
[Rule 4 (1)(d)
To Bangladesh Securities and Exchange Commission
Sub: Public Offer of 25,000,000 Ordinary Shares of Tk. 250,000,000 of Mohammed Elias Brothers POY Manufacturing Plant Limited.
Dear Sir, We, the under-noted Underwriter(s) to the above-mentioned forthcoming issue, state individually and collectively as follows:
1. We, while underwriting the above mentioned issue on a firm commitment basis, have examined the draft prospectus, other documents and materials as relevant to our underwriting decision; and
2. On the basis of such examination and the discussion with the issuer company, it’s directors and officers, and other agencies, independent verification of the statements concerning objects of the issue and the contents of the documents and other materials furnished by the issuer company.
WE CONFIRM THAT: a) We are registered with the Bangladesh Securities and Exchange Commission as a merchant banker and eligible to
carry out the underwriting activities. Our present paid up capital stands at Tk.10.00 crore (Taka ten crore) only and
we have the capacity to underwrite a total amount of Tk. 50.00 crore (Taka fifty crore) only as per relevant legal
requirements. We have committed to underwriter for up to BDT 35,00,000 (Thirty five lac taka) only for the upcoming
issue.
b) At present, the following underwriting obligations are pending for us:
Sl. No. Name of the Company Amount underwritten (BDT)
1 Supreme Seed Company Limited 33,000,000
2 SBS Cables Limited 34,000,000
3 Ananda Shipyard & Slipways Limited. 18,180,000
4 Genuity Systems Limited 18,750,000
5 Aftab Hatchery Limited 210,000,000
6 Desh General Insurance Company Limited 5,600,000
7 Ratanpur Steel Re-Rolling Mills limited (RSRM) 50,000,000
8 AB Bank Limited 45,000,000
Total 414,530,000
c) All information as are relevant to our underwriting decision have been received by us and the draft prospectus forwarded to the Commission has been approved by us;
d) We shall subscribe and take up the un-subscribed securities against the above mentioned public issue within 15 (fifteen) days of calling up thereof by the Issuer, and
e) This underwriting commitment is unequivocal and irrevocable
Sd/-
(Mohammed Ahsan Ullah)
Managing Director
Grameen Capital Management Limited
Place: Dhaka
Date: 26.12.2017
43
Annexure - C
Due Diligence Certificate by the Underwriter [Rule 4 (l)(d)]
To The Bangladesh Securities and Exchange Commission
Sub: Public offer of 25,000,000 Ordinary Shares of Tk. 250,000,000 of Mohammed Elias Brothers POY Manufacturing Plant Limited
Dear Sir,
We, the under-noted Underwriter(s) to the above-mentioned forthcoming issue, state individually and collectively as follows:
1. We, while underwriting the above mentioned issue on a firm commitment basis, have examined the draft prospectus,
other documents and materials as relevant to our underwriting decision; and
2. On the basis of such examination and the discussions with the issuer company, its directors and officers, and other
agencies, independent verification of the statements concerning objects of the issue and the contents of the documents
and other materials furnished by the issuer company.
WE CONFIRM THAT:
a) We are registered with the Bangladesh Securities and Exchange Commission as a merchant banker and eligible to
carry out the underwriting activities. Our present paid-up capital stands at Tk. 600,000,000 (Taka Sixty Crore Only)
and we have the capacity to underwrite a total amount of Tk. 3,000,000,000 (Taka Three Hundred Crore Only) as per
relevant legal requirements. We have committed to underwrite for up to BDT 3,500,000 (Taka Thirty Five Lac) only
for the upcoming issue.
b) At present, the following underwriting obligations are pending for us: SI. No. Name of The Company Amount Underwritten (Taka)
1 AB Bank Limited (Rights Share Offer ) 280,000,000.00
2 Bashundhara Paper Mills Ltd. 25,000,000.00
3 Infinity Technology International Limited 52,500,000.00
4 SK Trims & Industries Limited. 25,000,000.00
5 Popular Pharmaceuticals Limited 10,000,000.00
6 Runner Automobiles Limited 15,000,000.00
Total 407,500,000.00
c) All information as are relevant to our underwriting decision have been received by us and the draft prospectus
forwarded to the Commission has been approved by us;
d) We shall subscribe and take up the un-subscribed securities against the above-mentioned public issue within 15
(fifteen) days of calling up thereof by the issuer; and
e) This underwriting commitment is unequivocal and irrevocable.
For the Underwriter:
Sd/- Mohammed Saleh Ahmed Chief Executive Officer IIDFC Capital Limited
Date: 27/ 12/ 2017
44
Annexure - C DUE DILIGENCE CERTIFICATE BY THE UNDERWRITER
[Rule 4 (1)(d)]
To The Bangladesh Securities and Exchange Commission
Sub: Public Offer of 25,000,000 Ordinary Shares of Tk. 250,000,000.00 of Mohammed Elias Brothers POY Manufacturing Plant Limited.
Dear Sir, We, the under-noted Underwriter(s) to the above-mentioned forthcoming issue, state individually and collectively as follows: (3) We, while underwriting the above mentioned issue on a firm commitment basis, have examined the draft prospectus,
other documents and materials as relevant to our underwriting decision; and (4) On the basis of such examination and the discussions with the issuer company, its directors and officers, and other
agencies, independent verification of the statements concerning objects of the issue and the contents of the documents and other materials furnished by the issuer company.
WE CONFIRM THAT: (f) We are registered with the Bangladesh Securities and Exchange Commission as a merchant banker and eligible to carry
out the underwriting activities. Our present paid-up capital stands at Tk. 420,000,000.00 (Forty Two Crore only) and we have the capacity to underwrite a total amount of Tk. 2,100,000,000.00 (Two Hundred Ten Crore) as per relevant legal requirements. We have committed to underwrite for up to Tk. 3,500,000.00 (Thirty Five Lac) for the upcoming issue.
(g) At present, the following underwriting obligations are pending for us: (Name of issue and amount underwritten)
Sl. Name of the company Amount Underwritten (In Tk.)
1 Dhaka Regency Hotel & Resorts Ltd. 21,000,000.00
2 Bashundhara Paper Mills Ltd. 50,000,000.00
3 Delta Hospital Ltd 8,000,000.00
4 Advent Pharma Ltd. 15,000,000.00
5 M.L. Dyeing Ltd. 10,000,000.00
6 Esquire Knit Composit Ltd. 20,000,000.00
7 Silva Pharmaceuticals Ltd. 20,000,000.00
8 SK Trims & Industries Ltd. 25,000,000.00
9 S. S. Steel Mills Ltd. 50,000,000.00
10 Ashuganj Power Station Co. Ltd. (Bond) 5,000,000.00
11 Lub-rref (Bangladesh) Ltd. 30,000,000.00
12 GENEX INFOSYS LTD. 10,000,000.00
14 AB Bank Ltd. 50,000,000.00
15 CMC Kamal Textile Mills Ltd. 100,000,000.00
16 Ratanpur Steel Re-Rolling Mills Ltd. 50,000,000.00
Total 464,000,000.00
(h) All information as are relevant to our underwriting decision have been received by us and the draft prospectus forwarded
to the Commission has been approved by us; (i) We shall subscribe and take up the un-subscribed securities against the above-mentioned public issue within 15 (fifteen)
days of calling up thereof by the issuer; and (j) This underwriting commitment is unequivocal and irrevocable. For the Underwriter: Sd/- Md. Riyad Matin Managing Director BMSL Investment Limited Date: January 03, 2018
45
Annexure - C Due diligence certificate by the underwriter(s)
[Rule 4 (1) (d)]
To
The Bangladesh Securities and Exchange Commission
Sub: Public offer of 25,000,000 Ordinary shares of Tk. 250,000,000 of Mohammed Elias Brothers POY Manufacturing
Plant Limited.
Dear Sir,
We, the under-noted Underwriter(s) to the above-mentioned forthcoming issue, state individually and
Collectively as follows:
(1) We, while underwriting the above mentioned issue on a firm commitment basis, have examined the
draft prospectus, other documents and materials as relevant to our underwriting decision; and
(2) On the basis of such examination and the discussions with the issuer company, its directors and officers,
and other agencies, independent verification of the statements concerning objects of the issue and the
contents of the documents and other materials furnished by the issuer company.
WE CONFIRM THAT:
(a) We are registered with the Bangladesh Securities and Exchange Commission as a merchant banker and
Qualified to carry out the underwriting activities. Our present paid-up capital stands at TK. 250,000,000
and we have the capacity to underwrite a total amount of Tk.1,250,000,000 as per relevant legal requirements. We have
committed to underwrite for up to Tk. 3500,000 for the upcoming issue.
(b) At present, the following underwriting obligations are pending for us:
SL No. Name of the Company Amount Underwritten(Taka)
1 NIL
2
3
4
Total amount
(c) All information as are relevant to our underwriting decision have been received by us and the draft
Prospectus forwarded to the Commission has been approved by us;
(d) We shall subscribe and take up the un-subscribed securities against the above-mentioned issue within 15
(Fifteen) days of calling up thereof by the issuer; and
(e) This underwriting commitment is unequivocal and irrevocable.
For the Underwriter,
Sd/-
Mohammed Hafiz Uddin
Chief Executive Officer
MIDAS Investment Limited
Date: 03/01/2018
46
CHAPTER – IV ABOUT THE ISSUER
47
(a) Name of the issuer, dates of incorporation and commencement of its commercial operations, its logo, addresses of its registered office, other offices and plants, telephone number, fax number, contact person, website address and e-mail address;
Name of the issuer Mohammed Elias Brothers POY Manufacturing Plant Limited
Date of incorporation of the company August 01, 2002
Commencement of its commercial operations January 01, 2007
Logo
Address of its registered office As-Salam Tower (7th Floor), 57 Agrabad Commercial Area, Chittagong-4100, Bangladesh
Address of its other offices and plants 49/P, Kalurghat Heavy Industrial Area, Chittagong-4100, Bangladesh
Telephone Number (880) 31-2511194-7
Fax Number (880) 31-2511198
Contact Person Mr. Mohd. Rezaul Karim, Director & Managing Director
Website address www.mebpoy.com
E-mail address [email protected]
(b) The names of the sponsors and directors of the issuer
Sponsors of the Company
Sl. Name Status
1 Hajee Ahmed Hossain Sponsor
2 Mr. Md. Shamsul Alam Sponsor
3 Mr. Md. Nurul Absar Sponsor
4 Mr. Md. Nurul Alam Sponsor
5 Mr. Md. Khurshed Alam Sponsor
6 Mr. Md. Reazul Karim Sponsor
7 Mr. Md. Morshedul Alam Sponsor
8 Mr. Md. Aminul Karim Sponsor
Directors of the Company
Sl. Name Status
1 Mr. Sydul Karim Chairman
2 Mr. Mohd. Rezaul Karim Director & Managing Director
3 Mr. Mohd. Abrar Hossain Director
4 Mr. Mohd. Asfak Hossain Director
5 Mr. Mohd. Asrar Hossain Director
6 Mr. Mohd. Eradat Ullah, FCA Independent Director
7 Mr. Md. Golam Moin Uddin Chowdhury Independent Director
(c) The name, logo and address of the auditors and registrar to the issue, along with their telephone numbers, fax numbers, contact persons, website and e-mail addresses;
Auditor
Name Ahmed Zaker & Co. Chartered Accountants
Logo
Address 74, Sk. Mujib Road, Agrabad, C/A, Chittagong – 4100, Bangladesh
Telephone number 031-634103
Contact Person Mr. Arup Chowdhury
Website www.ahmed-zaker.com
E-mail address [email protected]
(d) The name(s) of the stock exchanges where the specified securities are proposed to be listed
Stock exchanges for the proposed securities
Dhaka Stock Exchange Limited (DSE)
Stock Exchange Building, 9/F Motijheel C/A, Dhaka, Bangladesh
Phone: 88-02-9564601, 9576210-18 FAX: +88-02-9564727, +88-02-9569755
Email: [email protected], Web: www.dsebd.org
Chittagong Stock Exchange Limited (CSE) CSE Building, 1080, Sk. Mujib Road Agrabad,
Chittagong, Bangladesh Tel: +88(0) 31-714632-3, Fax: +88(0) 31-714101
E-mail: [email protected], Web: www.cse.com.bd
48
CHAPTER - V CORPORATE DIRECTORY OF THE ISSUER
49
Corporate directory of the Issuer
Date of incorporation August 01, 2002
Date of commercial operation January 01, 2007
Changes in denomination of face value of shares
October 21, 2010
Date of conversion into a Public Limited Company
October 21, 2010
Authorized capital as on 30 September, 2017
Tk.3,000,000,000 comprises of 300,000,000 Ordinary shares of Tk.10 each
Issued , subscribed & paid up capital as on September 30, 2017
Tk.1,680,000,000 paid up capital which is comprises of 168,000,000 Ordinary shares of Tk.10 each
Registered office As Salam Tower (7th Floor), 57 Agrabad C/A, Chittagong-4100, Bangladesh Tel: (880) 31-2511194-97, 670406, 672744; Fax: (880) 31-2511198, 672733 E-mail: [email protected]; Website: www.mebpoy.com
Plants 49/P, Kalurghat Heavy Industrial Area, Chittagong-4100, Bangladesh
Sponsor 08 (Eight) persons
Board of directors 07 (Seven) directors including 2 (Two) independent directors
Auditors
AHMED ZAKER & CO.
Chartered Accountants 74, Sk. Mujib Road, Agrabad, C/A, Chittagong, Bangladesh Tel: 031-634103, www.ahmed-zaker.com, [email protected]
Valuer ROYAL INSPECTION INTERNATIONAL LTD. Corporate Office Baitul Khair, 48/A-B, Purana Paltan, Dhaka, Bangladesh Website: www.royalinspectionbd.net, E-mail : [email protected]
Legal Advisor
ADVOCATE ABUL MANSUR Chamber No. 4022, Ainzibi Annex Building 2, Chittagong Judges Court Chittagong, Bangladesh Tel: 088-31-01818914682, E-mail: [email protected]
Issue Managers
PRIME FINANCE CAPITAL MANAGEMENT LIMITED PFI Tower (6th Floor), 56-57 Dilkusha C/A, Dhaka-1000, Telephone: +88-02-9584874, 9584876-77, E-mail : [email protected], Website: www.primefincap.com
AIBL CAPITAL MANAGEMENT LIMITED Peoples Insurance Bhaban (4th Floor), 36 Dilkusha C/A, Dhaka-1000 Phone: +88 02 9551962, PABX 57160786-7; Fax: +88 02 9575379 Email: [email protected], Website: www.al-arafahbank.com AB INVESTMENT LIMITED
WW Tower (Level-7), 68, Motijheel C/A, Dhaka 1000
Phone: +88-02-9586169, +88-02-7125199, +88-02-9586169
E-mail: [email protected]; Website: www.abbl.com
Name of Underwriters
1. Prime Finance Capital Management Limited 2. AIBL Capital Management Limited 3. AB Investment Limited 4. ICB Capital Management Limited 5. BetaOne Investments Limited 6. First Security Islami Capital and Investment Limited 7. NBL Capital and Equity Management Limited 8. PLFS Investments Limited 9. Southeast Bank Capital Services Limited 10. Grameen Capital Management Limited 11. IIDFC Capital Limited 12. BMSL Investment Limited 13. MIDAS Investment Limited
Banker for the IPO
THE CITY BANK LIMITED Currency A/C No.
BDT 2921413595001 USD 5121413595001 EUR 5121413595002 GBD 5121413595003
Compliance officer Mr. Md. Mozaffor Ahmed, Company Secretary
50
CHAPTER – VI DESCRIPTION OF THE ISSUER
51
(a) Summary;
(i) The summary of the industry and business environment of the issuer. The summary shall not be one-sided or biased to highlight the issuer or the issue;
With the growing trend of increased consumption of Fully Draw Yarn (FDY), the internal requirement of product is rapidly increasing. Only 20% of the need can be met by the local production and the balance 80% has to be imported. The gap between the import cost and the manufacturing cost is too big and the feasibility of a new unit in Bangladesh is too high. At the same time, the demand of FDY is increasing at the rate of 12% per annum.
Since the local demand of Draw Textured Yarn (DTY) is much higher than the local production, a huge amount of DTY is required to be imported from various countries. Currently there are six companies producing DTY.
The use of DTY and the related industry is at present undergoing rapid structural changes, triggered in part by the withdrawal of import restrictions and the imminent easing of the import duty structure. The increasing expansion of garments factory, increasing demand of fishing net, mosquito net, weaving & knitting of fabrics for making clothes, home furnishings, seat covers, bags and many other uses in the country has boost up the need of more and more DTY, especially FDY which opened a new dimension in this sector.
Business environment of the issuer
The business environment is favorable to the Issuer for doing business. The business environment of the Issuer is mostly dependent on the following factors:
Product and uses:
The initial product of the Company was only POY till Dec 2009. The forward linkage of POY (Partially Oriented Yarn) is DTY (Draw Textured Yarn). The DTY unit was procured on 31 Dec 2009 and merged with the Company. Since then the company is marketing DTY. From 2010 POY is the raw materials for DTY and 100% captive consumption.
Machineries and capacity:
The project of the Company is equipped with brand new modern machinery imported from Germany, Japan, USA, India and Turkey with a view to produce Partially Oriented Yarn (POY) and Draw Textured Yarn (DTY) of international standard.
The Company started its commercial operation with a license capacity per annum 10,500,000 kg, installed capacity per annum 9,800,000 kg for POY and DTY. The Company currently employs 263 people as on September 30, 2017. The Company is the active member of Bangladesh Textile Mills Association (BTMA).
Market:
There is a huge demand in local market. Currently the Company is not exporting its product due to demand in local market is large.
Demand:
The use of DTY and the related industry is at present undergoing rapid structural changes, triggered in part by the withdrawal of import restrictions and the imminent easing of the import duty structure. The increasing expansion of garments factory, increasing demand of fishing net, mosquito net, weaving & knitting of fabrics for making clothes, home furnishings, seat covers, bags and many other uses in the country has boost up the need of more and more DTY, especially FDY which opened a new dimension in this sector.
Competitors:
There are few competitors in the industry and the issuer is holding significant portion of market share.
Suppliers: There are available suppliers in local and foreign.
Competitiveness:
The project is situated at strategic location at heavy industrial zone Kalurghat, port city of Chittagong. The project is well connected with other parts of the Country through road, sea, river, rail and air. There is available utility connectivity with the project. The product of the Company is distributed from its factory and depot. There are available workers for run the plant.
Rules and Regulations:
The prevailing rules and regulation of the Country is also favorable for the Industry.
(ii) Summary of consolidated financial, operating and other information
Mohammed Elias Brothers POY Manufacturing Plant Limited has no subsidiary or holding Company. Therefore, the Company does not prepare any consolidated financial statements.
52
(b) General Information;
(i) Name and address, telephone and fax numbers of the registered office, corporate head office, other offices, factory, business premises and outlets of the issuer;
Particulars Details
Name Mohammed Elias Brothers POY Manufacturing Plant Limited
Registered office address, telephone and fax numbers
As Salam Tower (7th Floor), 57 Agrabad C/A, Chittagong-4100, Bangladesh Tel: (880) 31-2511194-97, 670406, 672744; Fax: (880) 31-2511198, 672733 E-mail: [email protected]; Website: www.mebpoy.com
Factory office address 49/P, Kalurghat Heavy Industrial Area, Chittagong-4100
Business premises The Registered head office is considered as business premises of the Company
Other offices (Depot) ◊ 23/FM Mallhar Road, Tanbazar, Narayangonj ◊ New Bus stand, Narshingdhi
(ii) The Board of Directors of the issuer;
Sl. Name of the Board of Directors Position in the Company
1 Mr. Sydul Karim Chairman
2 Mr. Mohd. Rezaul Karim Director & Managing Director
3 Mr. Mohammad Abrar Hossain Director
4 Mr. Mohd. Asfak Hossain Director
5 Mr. Mohd. Asrar Hossain Director
6 Mr. Mohd. Eradat Ullah, FCA Independent Director
7 Mr. Md. Golam Moin Uddin Chowdhury Independent Director
(iii) Names, addresses, telephone numbers, fax numbers and e-mail addresses of the chairman, managing director, whole time directors, etc. of the issuer;
Sl. Name and position Address Telephone number Fax number E-mail address
1 Sydul Karim, Chairman 100, Khatungonj, Chittagong 088-31-2511194-97 088-31-2511198 [email protected]
2
Mohd. Rezaul Karim
Director & Managing
Director
100, Khatungonj, Chittagong 088-31-2511194-97 088-31-2511198 [email protected]
3 Mohammad Abrar Hossain
Director 100, Khatungonj, Chittagong 088-31-2511194-97 088-31-2511198 [email protected]
4 Mohd. Asfak Hossain
Director 100, Khatungonj, Chittagong 088-31-2511194-97 088-31-2511198 [email protected]
5 Mohd. Asrar Hossain
Director 100, Khatungonj, Chittagong 088-31-2511194-97 088-31-2511198 [email protected]
6 Mohd. Eradat Ullah FCA
Independent Director As Salam Tower (7th Floor), 57 Agrabad C/A, Chittagong
01554319678 088-31-2510817 [email protected]
7
Md. Golam Moin Uddin
Chowdhury
Independent Director
2894/4561, Kaptai Road, Kalurghat, Chittagong
01819361715 088-31-2511198 [email protected]
(iv) Names, addresses, telephone numbers, fax numbers and e-mail addresses of the CFO, company secretary, legal advisor, auditors and compliance officer;
CFO
Name : Mr. Md. Shahidullah khan
Address : As Salam Tower (7th Floor), 57 Agrabad C/A, Chittagong.
Telephone number : (880) 31-2511194-97
Fax number : 088-31-2511198
Email address : [email protected]
Company Secretary
Name : Mr. Md. Mozaffor Ahmed
Address : As Salam Tower (7th Floor), 57 Agrabad C/A, Chittagong.
Telephone number : (880) 31-2511194-97
Fax number : 088-31-2511198
Email address : [email protected]
Legal Advisor
53
Name : Advocate Abul Mansur
Address : Chamber No. 4022, Ainzibi Annex Building 2, Chittagong Judges Court, Chittagong, Bangladesh
Telephone number : N/A
Email address : [email protected]
Auditors
Name : Ahmed Zaker & Co.
Address : 74, Sheik Mujib Road (3rd Floor), Agrabad C/A, Chittagong.
Telephone number : 088-31-2516041
Email address : [email protected]
Compliance officer
Name : Md. Mozaffor Ahmed, Company Secretary
Address : As Salam Tower (7th Floor), 57 Agrabad C/A, Chittagong
Telephone number : (880) 31-2511194-97
Fax number : 088-31-2511198
Email address : [email protected]
(v) Names, addresses, telephone numbers, fax numbers, contact person, website addresses and e-mail addresses of the issue manager(s), registrar to the issue etc.;
Issue Managers
Name : Prime Finance Capital Management Limited
Address : PFI Tower (6th Floor) 56-57, Dilkusha C/A, Dhaka-1000
Telephone number : +88-02-9584874, 9584876-77
Fax number : +88-02-9584922
Contact person : Mr. M. Mosharraf Hossain FCA, PhD, Managing Director & CEO
Website : www.primefincap.com
Email address : [email protected]
Name : AIBL Capital Management Limited
Address : Peoples Insurance Bhaban (4th Floor), 36 Dilkusha C/A, Dhaka-1000
Telephone number : +88 02 9551962, PABX 57160786-7
Fax number : +88 02 9575379
Contact person : Mr. Muhammad Husain Ahmad Faruqi, Chief Executive Officer
Website : www.al-arafahbank.com
Email address : [email protected]
Name : AB Investment Limited
Address : WW Tower (Level-7), 68, Motijheel C/A, Dhaka 1000
Telephone number : +88-02-7120590, +88-02-7125199
Fax number : +88-02-9586126
Contact person : Mr. Sheikh Ashraful Haque, Chief Executive Officer
Website : www.abbl.com
Email address : [email protected]
Registrar to the Issue is not required due to the Issue is offered at par value.
(vi) The following details of credit rating, where applicable:
As per section 3 of Credit Ratings Companies Rules, 1996, no credit rating report is required for the Company.
(vii) Following details of underwriting:
a) The names, addresses, telephone numbers, fax numbers, contact persons and e-mail addresses of the underwriters and the amount underwritten by them
Name Address Telephone Fax Number Contact Person E-mail
Addresses
Number of
Share underwritten
Amount in Taka
%
Prime Finance Capital Management Limited
PFI Tower (6thFloor),56-57 Dilkusha C/A, Dhaka-1000
+88-02- 9584874
+88-2-9584922 Mr. M. Mosharraf Hossain FCA, PhD Managing Director & CEO
info@primefincap .com
1,600,000 16,000,000 18.29%
AIBL Capital Management Limited
Peoples Insurance Bhaban (4th Floor) 36 Dilkusha C/A, Dhaka-1000
+88-02- 9551962
+88 02 9575379 Mr. Muhammad Husain Ahmad Faruqi Chief Executive Officer
1,600,000 16,000,000 18.29%
AB Investment Limited WW Tower (Level-7), 68, Motijheel C/A, Dhaka 1000
+88-02- 7125199
+88-02-9586126 Mr. Sheikh Ashraful Haque Chief Executive Officer
1,400,000 14,000,000 16.00%
ICB Capital Management Limited
Green City Edge, 5th & 6th Floor, 89, kakrail, Dhaka- 1000
+88-02- 8300555
+88-02-8300396 Mr. Md. Shohel Rahman [email protected]
1,000,000 10,000,000 11.43%
54
Chief Executive Officer (Additional Charge)
BetaOne Investments Limited
Green Delta AIMS Tower (Level–4), 51-52, Mohakhali C/A, Dhaka
+88-02- 9887337
+88-02-9880733 Mr. Mohammed Atiquzzaman Managing Director
info@betaone .com.bd
350,000 3,500,000 4.00%
First Security Islami Capital and Investment Limited
Al-Amin Center (12th Floor), 25/A Dilkusha C/A, Dhaka – 1000
+88-02- 9578569
+88-02-9515917 Mr. K M Rasidul Hasan Chief Executive Officer
350,000 3,500,000 4.00%
NBL Capital and Equity Management Limited
Printers Building (8th Floor), 5, Rajuk Avenue, Dhaka-1000
+88-02- 47118816
+88-02-47118805
Ms. Kamrun Naher Chief Executive Officer
350,000 3,500,000 4.00%
PLFS Investments Limited City Centre (Level 12), Unit 11-B, 90/1 Motijheel C/A, Dhaka-1000
+88-02- 55110919
+88-02-55110939
Mr. Md. Abdul Muktadir, CFA Chief Executive Officer
350,000 3,500,000 4.00%
Southeast Bank Capital Services Limited
Eunoos Center (Level-9), 52-53 Dilkusha C/A, Dhaka -1000
+88-02- 9574171
+88-02- 9574169
Mr. Md. Abu Bakar, FCA Managing Director
mbw@southeastbank .com.bd
350,000 3,500,000 4.00%
Grameen Capital Management Limited
Grameen Bank 1st Building (2nd floor), Mirpur-2, Dhaka-1216
+88-02- 9004923
+88-02-8057618 Mr. Mohammed Ahsan Ullah Managing Director
350,000 3,500,000 4.00%
IIDFC Capital Limited Eunoos Trade Center (Level 7), 52-53 Dilkusha C/A, Dhaka 1000
+88-02- 9514637-8
+88-02-9514641 Mr. Mohammad Saleh Ahmed Chief Executive Officer
[email protected] 350,000 3,500,000 4.00%
BMSL Investment Limited Shareef Mansion (4th floor), 56-57, Motijheel C/A, Dhaka-1000
+88-02-9577651
+88-02-47117218
Md. Riyad Matin Managing Director
[email protected] 350,000 3,500,000 4.00%
MIDAS Investment Limited
House #05, Road # 16(New) 27 (old), Dhanmondi, Dhaka-1209
+88-02-9119371
+88-02-8142085 Omer Farooque Manager (Accounts and Compliance)
350,000 3,500,000 4.00%
8,750,000 87,500,000 100.00%
b) Declaration by the underwriters that they have sufficient resources as per the regulatory requirements to discharge their respective obligations
We the underwriters have sufficient resources as per the regulatory requirements to discharge our respective obligations.
For Underwriters
Sd/‐
Managing Director/ Chief Executive Officer
1. Prime Finance Capital Management Limited 2. AIBL Capital Management Limited 3. AB Investment Limited 4. ICB Capital Management Limited 5. BetaOne Investments Limited 6. First Security Islami Capital and Investment Limited 7. NBL Capital and Equity Management Limited 8. PLFS Investments Limited 9. Southeast Bank Capital Services Limited 10. Grameen Capital Management Limited 11. IIDFC Capital Limited 12. BMSL Investment Limited 13. MIDAS Investment Limited
c) Major terms and conditions of the underwriting agreements.
1. In case of under-subscription in any category by up to 35% in an initial public offer, the unsubscribed portion of securities shall be taken up by the underwriter.
2. If and to the extent that the shares are offered to the public by a prospectus authorized hereunder shall not have been subscribed and paid for in cash in full by the closing date of subscription, the Company shall within 10 (Ten) days of the closure of subscription call upon the underwriter in writing with a copy of the said writing to the Bangladesh Securities and Exchange Commission, to subscribe or procure subscriber to subscribe the shares not subscribed within the closing date and to pay for in cash in full, inclusive of any premium if applicable, for such unsubscribed shares within 15 (Fifteen) days after being called upon to do so. The received amount shall be credited in the share subscription account of the Company within the said period. If payment is made by Cheque/Bank Draft by the underwriter it will be deemed that the underwriter has not fulfilled his obligation towards the underwriting commitment under this Agreement, until such time as the Cheque/Bank Draft has been encashed and the Company’s share subscription account credited. In any case within 7 (seven) days after the expiry of the aforesaid 15(fifteen) days, the Company shall send proof of subscription and payment by the underwriter to the Commission.
3. The Underwriter shall underwrite on a firm commitment basis. This commitment is irrevocable and
unequivocal.
55
(c) Capital Structure:
(i) Authorized, issued, subscribed and paid up capital (number and class of securities, allotment dates, nominal price, issue price and form of consideration)
Authorized capital
Authorized capital as on September 30, 2017 is Tk. 3,000,000,000 divided into 300,000,000 shares of Tk. 10 each.
Issued, Subscribed and Paid up capital
Auditor’s certificate regarding the amount shown against paid up capital of Mohammed Elias Brothers POY Manufacturing Plant Limited
Based on our examination of share Register and its underlying documents, the paid-up capital of Mohammed Elias Brothers POY Manufacturing Plant Limited as on September 30, 2017 appears at Tk. 1,680,000,000 consisting of 168,000,000 no. of Ordinary Shares of Tk. 10 each as follows:
Authorized Capital 300,000,000 shares @ Tk. 10 each 3,000,000,000
Issued, Subscribed and Paid up Capital of 168,000,000 Ordinary Shares @ Tk. 10 each in full in cash and other than cash
Allotments for Cash Consideration
At the time of incorporation as on August 01, 2002 500,000
Issued as on April 14,2005 20,000,000
Issued as on March 22, 2010 9,500,000
Issued as on March 29, 2010 70,000,000
Issued as on November 24, 2011 89,000,000
Issued as on November 27, 2011 36,500,000
Issued as on January 02, 2012 474,500,000
Sub Total (A) 700,000,000
Allotments Other Than Cash
Bonus Share Issue on November 20, 2011 800,000,000
Bonus Share Issue on December 22, 2013 180,000,000
Sub Total (B) 980,000,000
Grand Total C=(A+B) 1,680,000,000
The above-mentioned Allotments for Cash Consideration was deposited to the Trust Bank Ltd., Agrabad Branch, Chittagong and IFIC Bank Ltd., Pragoti Sharani Branch, Dhaka.
The Company has subdivided the face value of its ordinary share from BDT 100.00 to BDT 10.00 by passing a special resolution in its Extraordinary General Meeting held on 21th October, 2010. Thus, paid-up capital of the Company comes to BDT 1,680,000,000/- (Taka One hundred sixty-eight crores only) divided into 168,000,000/- nos. ordinary shares of BDT 10.00 each.
Sd/- Ahmed Zaker & Co. Place: Chittagong
Chartered Accountants Dated: 10.12.2017 (ii) Size of the present issue, with break-up (number of securities, description, nominal value and issue amount);
Total fund to be raised through IPO (subject to approval through regulatory authority)
Description Number of Securities to be Offered Percentage Break-up of Securities
Nominal value
Issue Amount in BDT
Offer price BDT 10.00 each at par, total size of fund to be raised BDT. 250,000,000
Eligible investor (EI)
EI excluding mutual funds and CIS
40% 10,000,000
10.00
100,000,000
Mutual Funds and CIS 10% 2,500,000 25,000,000
General Public (GP) GP excluding NRB 40% 10,000,000 100,000,000
NRB 10% 2,500,000 25,000,000
Total 100% 25,000,000 10.00 250,000,000
(iii) Paid up capital before and after the present issue, after conversion of convertible instruments (if any) and share premium account (before and after the issue);
Proposed capital structure before and after IPO (subject to approval of regulatory authority)
Particulars No. of Securities Issue Price Amount in BDT
Paid-up capital before the present issue 168,000,000 10.00 1,680,000,000
Paid-up capital after the present issue (subject to approval of regulatory authority)
193,000,000 10.00 1,930,000,000
56
Paid-up capital after conversion of convertible instruments (if any) N/A
Share premium account before the present issue N/A
Share premium account after the present issue N/A
(iv) Category wise shareholding structure with percentage before and after the present issue and after conversion of convertible instruments (if any);
Category wise shareholding structure with percentage before and after the present issue
Sl. Category of Shareholders No. of Ordinary Shares Hold Percentage of Holding After conversion
Pre‐IPO Post‐IPO Pre‐IPO Post‐IPO Pre‐IPO Post‐IPO
1 Directors & Sponsors 65,209,680 65,209,680 38.82 33.79
N/A N/A
2 Other than Directors & Sponsors 102,790,320 102,790,320 61.18 53.26
3 Eligible investor (EI)
EI excluding mutual funds and CIS
- 10,000,000 - 5.18
Mutual Funds and CIS - 2,500,000 - 1.30
4 General Public (GP)
GP excluding NRB - 10,000,000 - 5.18
NRB - 2,500,000 - 1.30
Total 168,000,000 193,000,000 100% 100%
(v) Where shares have been issued for consideration in other than cash at any point of time, details in a separate table, indicating the date of issue, persons to whom those are issued, relationship with the issuer, issue price, consideration and valuation thereof, reasons for the issue and whether any benefits have been accrued to the issuer out of the issue
Sl. Date of
issue Person to whom those
are issued Relationship with Issuer
Issue price
Consideration and valuation
thereof
Reasons for the issue
Whether any benefits have been accrued to the
issuer out of the issue
1 20.11.2011 Existing shareholders Shareholder 10 Bonus share at
face value To enhance
paid up capital
Reinvestment of
distributable profit
2 22.12.2013 Existing shareholders Shareholder 10 Bonus share at
face value To enhance
paid up capital
Reinvestment of
distributable profit
(vi) Where shares have been allotted in terms of any merger, amalgamation or acquisition scheme, details of such scheme and shares allotted;
No share has been allotted in terms of any merger, amalgamation or acquisition scheme.
(vii) Where the issuer has issued equity shares under one or more employee stock option schemes, date-wise details of equity shares issued under the schemes, including the price at which such equity shares were issued;
No share has been issued under one or more employee stock option schemes.
(viii) If the issuer has made any issue of specified securities at a price lower than the issue price during the preceding two years, specific details of the names of the persons to whom such specified securities have been issued, relation with the issuer, reasons for such issue and the price thereof;
The Company has not made any issue of specified securities at a price lower than the issue price during the preceding two years.
(ix) The decision or intention, negotiation and consideration of the issuer to alter the capital structure by way of issue of specified securities in any manner within a period of one year from the date of listing of the present issue;
The Company has no such decision or intention, negotiation and consideration to alter the capital structure by way of issue of specified securities in any manner within a period of one year from the date of listing of the present issue.
(x) The total shareholding of the sponsors and directors in a tabular form, clearly stating the names, nature of issue, date of allotment, number of shares, face value, issue price, consideration, date when the shares were made fully paid up, percentage of the total pre and post issue capital, the lock in period and the number and percentage of pledged shares, if any, held by each of them;
Name Nature of
Issue Date of
allotment/transfer Number of
shares Face value
Issue price
Consideration
Date when the shares were
made fully paid up
% of the total capital Lock in period
Status of pledged shares
Pre-issue
Post-issue
No. of shares
%
Hajee Ahmed Hosain
Ordinary Shares
Date of incorporation
5000 10 10 Cash 1/8/2002 - - N/A N/A -
Md. Shamsul Alam
Ordinary Shares
Date of incorporation
8330 10 10 Cash 1/8/2002 1.55 1.35 3 years Nil -
14-4-2005 250000 10 10 Cash 14-4-2005
57
20-11-11 2066640 10 10 Bonus 20-11-11
22-12-2013 278996 10 10 Bonus 22-12-2013
Total 2608966
Md. Nurul Absar Ordinary
Shares
Date of incorporation
5000 10 10 Cash 1/8/2002
0.89 0.78 3 years Nil -
30-09-03 540 10 10 Transfer 30-09-03
2/10/2003 160 10 10 Transfer 2/10/2003
14-04-05 142850 10 10 Cash 14-04-05
20-11-11 1188400 10 10 Bonus 20-11-11
22-12-2013 160434 10 10 Bonus 22-12-2013
Total 1497384
Md. Nurul Alam Ordinary
Shares
Date of incorporation
5000 10 10 Cash 1/8/2002
0.89 0.78 3 years Nil -
30-09-03 540 10 10 Transfer 30-09-03
2/10/2003 120 10 10 Transfer 2/10/2003
2/10/2003 40 10 10 Transfer 2/10/2003
14-04-05 142850 10 10 Cash 14-04-05
20-11-11 1188400 10 10 Bonus 20-11-11
22-12-2013 160434 10 10 Bonus 22-12-2013
Total 1497384
Md. Khurshed Alam
Ordinary Shares
Date of incorporation
8330 10 10 Cash 1/8/2002
1.55 1.35 3 years Nil - 14-4-2005 250000 10 10 Cash 14-4-2005
20-11-11 2066640 10 10 Bonus 20-11-11
22-12-2013 278997 10 10 Bonus 22-12-2013
Total 2603967
Md. Murshed Alam
Ordinary Shares
Date of incorporation
8340 10 10 Cash 1/8/2002
1.55 1.35 3 years Nil - 14-4-2005 250000 10 10 Cash 14-4-2005
20-11-11 2066720 10 10 Bonus 20-11-11
22-12-2013 279007 10 10 Bonus 22-12-2013
Total 2604067
Md. Aminul Karim
Ordinary Shares
Date of incorporation
5000 10 10 Cash 1/8/2002
1.93 1.68 3 years Nil -
30-09-03 560 10 10 Transfer 30-09-03
2/10/2003 120 10 10 Transfer 2/10/2003
2/10/2003 40 10 10 Transfer 2/10/2003
14-04-05 142850 10 10 Cash 14-04-05
20-11-2011 1188560 10 10 Bonus 20-11-11
2/2/2012 1662870 10 10 Placement 2/2/2012
21-11-2012 -100000 10 10 Transfer 21-11-2012
22-12-2013 348000 10 10 Bonus 22-12-13
Total 3248000
Sydul Karim, Chairman
Ordinary Shares
30.09.2003 560 10 10 Transfer 30.09.2003
4.90% 4.26% 3 years Nil -
02.10.2003 160 10 10 Transfer 02.10.2003
14.04.2005 142,900 10 10 Cash 30.12.2005
20.11.2011 1,148,960 10 10 Bonus 20.11.2011
02.01.2012 1707420 10 10 Cash 02.01.2012
17.11.2012 9,500,000 10 10 Transfer 17.11.2012
22.12.2013 1,500,000 10 10 Bonus 22.12.2013
05.12.2013 -7,079,986 10 10 Transfer 05.12.2013
28-12-2017 1310000 10 10 Gift 28-12-2017
Total 8230014
Mohd. Rezaul Karim, Sponsor, Director & Managing Director
Ordinary Shares
1/8/2002 5,000 10 10 Cash 1/8/2002
4.90% 4.26% 3 years Nil -
30.09.2003 560 10 10 Transfer 30.09.2003
02.10.2003 160 10 10 Transfer 02.10.2003
14.04.2005 142,850 10 10 Cash 30.12.2005
20.11.2011 1188560 10 10 Bonus 20.11.2011
02.01.2012 1,662,870 10 10 Cash 02.01.2012
17.11.2012 9,500,000 10 10 Transfer 17.11.2012
22.12.2013 1,500,000 10 10 Bonus 22.12.2013
05.12.2013 -7,079,986 10 10 Transfer 05.12.2013
28-12-2017 1310000 10 10 Gift 28-*12-2017
Total 8230014
Mohd. Abrar Hossain, Director
Ordinary Shares
27.11.2011 500,000 10 10 Cash 27.11.2011
5.42% 4.71% 3 years Nil -
02.01.2012 2,500,000 10 10 Cash 02.01.2012
17.11.2012 9,500,000 10 10 Transfer 17.11.2012
22.12.2013 1,500,000 10 10 Bonus 22.12.2013
05.12.2013 -7079985 10 10 Transfer 05.12.2013
30.12.2013 817,604 10 10 Transfer 30.12.2013
29.09.2015 50,000 10 10 Transfer 29.09.2015
28-12-2017 1310000 10 10 Gift 28-12-2017
Total 9097619
Mohd. Asfak Hossain, Director
Ordinary Shares
27.11.2011 500,000 10 10 Cash 27.11.2011
5.48% 4.77% 3 years Nil -
17.11.2012 12,100,000 10 10 Transfer 17.11.2012
22.12.2013 1,512,000 10 10 Bonus 22.12.2013
05.12.2013 -7,079,986 10 10 Transfer 05.12.2013
30.12.2013 817604 10 10 Transfer 30.12.2013
29.09.2015 50,000 10 10 Transfer 29.09.2015
28-12-2017 1310000 10 10 Gift 28-12-2017
Total 9209618
Mohd. Asrar Hossain, Director
Ordinary Shares
27.11.2011 500,000 10 10 Cash 27.11.2011
5.42% 4.71% 3 years Nil - 17.11.2012 12,000,000 10 10 Transfer 17.11.2012
22.12.2013 1,500,000 10 10 Bonus 22.12.2013
05.12.2013 -7,079,985 10 10 Transfer 05.12.2013
58
30.12.2013 817604 10 10 Transfer 30.12.2013
29.09.2015 50,000 10 10 Transfer 29.09.2015
28-12-2017 1310000 10 10 Gift 28-12-2017
Total 9097619
xi) The details of the aggregate shareholding of the sponsors and directors, the aggregate number of specified securities purchased or sold or otherwise transferred by the sponsor and/or by the directors of the issuer and their related parties within six months immediate preceding the date of filing the prospectus or prospectus or information memorandum;
No share has been purchased or sold or otherwise transferred by the sponsor and/or by the directors of the issuer and their related parties within six months immediate preceding the date of filing the prospectus. However, the aggregate shareholding position of the sponsors and directors before IPO is as follows:
Sl. Category No. of share held Amount in Tk. %
1 Sponsors 14,054,768 140,547,680 8.73 %
2 Directors 43,864,884 438,648,840 26.11%
34.48%
Note: Mr. Mohd. Rezaul Karim is the Sponsor as well as a Director of the Company. We considered him in Director category.
(xii) The name and address of any person who owns, beneficially or of record, 5% or more of the securities of the issuer, indicating the amount of securities owned, whether they are owned beneficially or of record, and the percentage of the securities represented by such ownership including number of equity shares which they would be entitled to upon exercise of warrant, option or right to convert any convertible instrument;
Name of the Shareholders Address No. of shares owned
as on 30.09.2017 % of securities
owned Types of
ownership
Mr. Abdus Salam 234, Khatungonj, Chittagong,
Post Code: 4000 26,880,000 16.00% Shareholder
Mir Mohammad Hossain 234, Khatungonj, Chittagong 15,120,000 9.00% Shareholder
Mir Muhammad Nasir 234, Khatungonj, Chittagong 15,120,000 9.00% Shareholder
Mir Mohammed Hassan 234, Khatungonj, Chittagong 15,120,000 9.00% Shareholder
There is no event or intent of exercising warrant, option or right to convert any convertible instrument.
(xiii) The number of securities of the issuer owned by each of the top ten salaried officers, and all other officers or employees as group, indicating the percentage of outstanding shares represented by the securities owned.
No salaried officers and all other officers or employees as group have been holding any securities of the Company.
(d) Description of Business:
(i) The date on which the issuer company was incorporated and the date on which it commenced operations and the nature of the business which the company and its subsidiaries are engaged in or propose to engage in;
Date of incorporation and commencement of incorporation
Mohammed Elias Brothers POY Manufacturing Plant Limited was incorporated on 1st August 2002 under the Companies Act 1994 vide Reg. No. C-4410 of 2002 with an authorized capital of Tk. 3,000,000,000 divided into 300,000,000 ordinary shares of Tk. 10 each.
The Company started its commercial operation with a license capacity per annum 10,500,000 kg, installed capacity per annum 9,800,000 kg for POY and DTY. The Company currently employs 263 people as on September 30, 2017.
Nature of the business of the issuer
The initial product of the Company was only POY till Dec 2009. The forward linkage of POY (Partially oriented Yarn) is DTY (Draw Textured Yarn). The DTY unit was procured on 31 Dec 2009 and merged with the Company. Since then the company is marketing DTY. From 2010 POY is the raw materials for DTY and 100% captive consumption.
Nature of the business of the issuer subsidiaries
Mohammed Elias Brothers POY Limited has no subsidiary Company.
(ii) Location of the project;
The project of the Company is located at 49/P, Kalurghat Heavy Industrial Area, Chittagong-4100.
(iii) Plant, machinery, technology, process, etc.
Plant & machinery
Mohammed Elias Brothers POY Manufacturing Plant Limited has commenced its business with a view to delivering high quality produces Partially Oriented Yarn (POY) and Draw Textured Yarns (DTY). Keeping in the mind regarding delivery of quality and satisfaction, the Company installed high tech and automated machineries in the very inception period of its business which helps the Company to be competitive over the competitors in the market.
59
Technology
The factories of Mohammed Elias Brothers POY Manufacturing Plant Limited is well equipped with modern machineries sourced from Japan, Germany, India & USA. Apart from these, the TALLY system of the Company allows the corporate office to smooth financial operation.
Process
The production process flow chart of Mohammed Elias Brothers POY Manufacturing Plant Limited is as follows:
(iv) Details of the major events in the history of the issuer, including details of capacity or facility creation, launching of plant, products, marketing, change in ownership and/or key management personnel etc.;
Particulars Status
Date of incorporation August 01, 2002
The Company started its commercial
operation/Launching of plant January 01, 2007
Conversion into public limited company October 21, 2010
Change of face value October 21, 2010
Capacity details:
POY/DTY 30.09.2017 30.06.2017 30.06. 2016
Installed capacity 98,00,000 kg 98,00,000 kg 98,00,000 kg
Actual Production 22,16,326 kg 66,89,507 kg 1659895 kg
Capacity utilized as on September 30, 2017 22.62% 68.26% 16.94%
Launching of Plant January 01, 2007
Products Partially Oriented Yarn produced from Petrochemical Chips.
Draw Textured Yarn (DTY) produced from POY.
Marketing
The product DTY is produced in different denier. As per demand of the local market the products are directly delivered to wholesale market located in Narayangonj, Madhobdhi, Narshindi, Pubna, Sirajgonj etc. The DTY yarn is mainly used in weaving and knitting of fabrics for making cloths, home furnishings, seat covers, bags, sport jerseys, fishing nets, zipper tapes etc.
Chips Silo
Dryer Extruder
Polymer Filter
Polymer Manifold
Pack/Spinneret
Metering Pump
Spinning Beam
Quench Chamber
Spin Finish Guide
1st & 2nd Godet
Winder
Air Entangled/Yarn Sensor
60
Changes in ownership
Name Date of
allotment/transfer Number of shares Consideration
Sydul Karim Chairman
30.09.2003 560 Transfer
02.10.2003 160 Transfer
17.11.2012 9,500,000 Transfer
05.12.2013 -7,079,986 Transfer
Mohd. Rezaul Karim Director & Managing
Director
30.09.2003 560 Transfer
02.10.2003 160 Transfer
17.11.2012 9,500,000 Transfer
05.12.2013 -7,079,986 Transfer
Mohd. Abrar Hossain Director
17.11.2012 9,500,000 Transfer
05.12.2013 -7,079,985 Transfer
30.12.2013 817,604 Transfer
29.09.2015 50,000 Transfer
Mohd. Asfak Hossain Director
17.11.2012 12,100,000 Transfer
05.12.2013 -7,079,986 Transfer
30.12.2013 817,604 Transfer
29.09.2015 50,000 Transfer
Mohd. Asrar Hossain Director
17.11.2012 12,000,000 Transfer
05.12.2013 -7,079,985 Transfer
30.12.2013 817,604 Transfer
29.09.2015 50,000 Transfer
Change in key management personnel There were no changes in Key Management person.
(v) Principal products or services of the issuer and markets for such products or services. Past trends and future prospects regarding exports (if applicable) and local market, demand and supply forecasts for the sector in which the product is included with source of data;
Principal products
Partially Oriented Yarn (POY) produced from Pet Chips.
Draw Textured Yarn (DTY) produced from POY.
Markets for such products
The product DTY is produced in different denier. As per demand of the local market the products are directly delivered to wholesale market located in Narayangonj, Madhobdhi, Narshindi, Pabna, Sirajgonj etc. The DTY yearn is mainly used in weaving and knitting of fabrics for making cloths, home furnishings, seat covers, bags, sport jerseys, fishing nets, zipper tapes etc.
Past trend in local Market
Particulars 01.07.17-30.09.17 01.07.16-30.06.17 01-01-16-30.06.16 01.01.15-31.12.15 01.01.14-31.12.14 01.01.13-31.12.13
Turnover 288,141,017 696,935,855 134,465,796 1,099,540,460 695,644,043 1,141,286,124
Future prospects regarding local market
Bangladesh Export sector is heavily inclined to RMG. RMG and textile sector contributes maximum of national export of Bangladesh. This sector has remarkable growth and huge contribution to the overall export of the Country. As a producer of DTY yearn which is mainly used in weaving and knitting of fabrics for making cloths, home furnishings, seat covers, bags, sport jerseys, fishing nets, zipper tapes etc., MEBPOY also has a great opportunity to increase its market share.
Demand and Supply forecast
Since the local demand of DTY is much higher than the local production, a huge amount of DTY is required to be imported from various countries. Hence the Company has a great opportunity to develop their business by raising the production capacity.
(vi) If the issuer has more than one product or service, the relative contribution to sales and income of each product or service that accounts for more than 10% of the company’s total revenues;
The Company carries out Polyester Filament Yarns manufacturing activities. 100% revenue of the Company is generated from selling of the produced yarns i.e. DTY.
(vii) Description of associates, subsidiary and holding company of the issuer and core areas of business thereof;
The Company has no associate, subsidiary and holding Company.
61
(viii) How the products or services are distributed with details of the distribution channel. Export possibilities and export obligations, if any;
Since the Company maintains strict quality policy relating to its products, the product has a demand and goodwill in the local market. At present, the entity has an established business relation with many local market and buyers. The products are sold and distributed to the customers directly and through local distributors
Details of distribution channel
The company sells its products through its factory premises, depot and distributors:
Name and address of the main distributors are as follows:
Sl. Name of Distributor Address of Distributor
1 Yousuf yarn Trading 18, Post Office Road, Tarabo, Narayangonj
2 Saiful Yarn Trading Bank Para, Madhobdi, Narsingdi
3 Arif Trading 724, Tanbazar, Narayangonj
4 Well Trading Bank Para, Madhobdi, Narsingdi
5 Gemmy Enterprise Bank Para, Madhobdi, Narsingdi
6 Das traders 46, Post Office, Tarabo, Narayangonj
(ix) Competitive conditions in business with names, percentage and volume of market shares of major competitors
Since the local demand of DTY is much higher than the local production, a huge amount of DTY is required to be imported from various countries. Hence, the Company has a great opportunity to develop their business by raising the production capacity.
The major market competitors of Mohammed Elias Brothers POY Manufacturing Plant Limited in the Polyester Filament Yarns manufacturing industry are as follows:
Sl. Company Name Status
1 Beximco Synthetics Ltd.
Listed
2 Modern Poly Ltd.
Non-listed
3 Bengal Synthetics Fibers Ltd.
Non-listed
4 Quader Synthetics Ltd.
Non-listed
5 Super Synthetics Ltd.
Non-listed
Market shares:
Sl. Company Name Market Share
1 MEBPOY 20%
2 Beximco Synthetics Ltd.
10%
3 Modern Poly Ltd.
23%
4 Bengal Synthetics Fibers Ltd.
10%
5 Quader Synthetics Ltd.
27%
6 Super Synthetics Ltd.
10% Source: Own market survey
(x) Sources and availability of raw materials, names and addresses of the principal suppliers and contingency plan in case of any disruption
The sources and availability of raw materials of the company is as follows:
Items of Raw Materials Name & address of Suppliers Terms of procurement
PET CHIPS
Foreign Suppliers: 1) TAINAN SPINNING CO. LTD, TAIPEI OFFICE:10FL., NO.9 SONGGAO RD., SINYI DISTRICT, TAIPEI, TAINAN. TEL: 886-2-2758-9888 FAX: 886-2-2758-2804. 2) PT POLYCHEM INDONESIA TBK. WISMA 46-KOTA BNI LT.20, JL. JEND. SUDIRMAN KAV.1, JAKARTA 10220 INDONESIA. TEL:62 21 5512896 3) ITOCHU CORPORATION 5-1 KITA-AOYAMA 2-CHOME, MINATO-KU, TOKYO 107-77 JAPAN.
LETTER OF CREDIT
62
TEL:81-3-3497-6838 4) XIAMEN XIANGLU CHEMICAL FIBER CO. LTD LUKENG, HAICANG INVESTMENT ZONE, XIAMEN 361026, P.R. CHINA. Tel:0592 6882314. 5) RECRON (MALAYSIA) SDN.BHD. (COMPANY NO.781769-K) LEVEL 9, WISMA GOLDHILL, 67, JALAN RAJA CHULAN, 50200, KUALA LUMPUR, MALAYSIA, TEL: 03-20316000
Local Suppliers 1) BIDCO ASSOCIATES 109, TANBAZAR, NARAYANGONJ, BANGLADESH. 2) M/S. RASHID AND BROTHERS 10, BANKPARA, MADABDHI, NARSHINDI. 3) M/S. R.K. ENTERPRISE 120, G.K. ROAD, MADABDHI, NARSHINDI, BANGLADESH. 4) A.R. TRADING 427, TANBAZAR, NARAYANGONJ, BANGLADESH. 5) M/S. MONIR TRADING 9, BANKPARA, MADABDHI, NARSHINDI.
LOCAL PURCHASE
FINISHING & ANTISEPTIC AGENT
Foreign Suppliers: SOJITZ CORPORATION 1-1 UCHISAIWAICHO 2-CHOME, CHIYODA-KU TOKYO 100-8691, JAPAN. TEL:03-6871-5356, FAX:03-6858-7297
LETTER OF CREDIT
STAINLESS STEEL SAND
Foreign Suppliers: SOSSNA GMBH INGENIEURGTECHNIK, ELBESTRASSE 10, 45768 MARL/GERMANY. TEL:02365-5175-0, FAX:02365-5175-20
LETTER OF CREDIT
CONING OIL Foreign Supplier: UNICON FIBRO CHEMICALS PVT. LTD. REGD. OFF.: 6-B, ANAND NAGAR, SHITALADEVI TEMPLE ROAD, MOHIM (WEST), MUMBAI-400016, INDIA.
LETTER OF CREDIT
Local Suppliers: M/S. JU-TEX CHEMICALS LTD 780, JALKURI, UTTARPARA, SIDDIRGONJ, NARAYANGONJ, DHAKA. MOBILE:01858-524492, 01819-368080
LOCAL PURCHASE
Contingency plan in case of any disruption
As there are sufficient numbers of suppliers so the issuer has alternative options for sourcing of raw materials if any suppliers fail to supply raw materials. Again, the Company maintains adequate level of stock of raw materials against its demand for production. Therefore, there are less possibilities of shortage of raw materials.
(xi) Sources of, and requirement for, power, gas and water; or any other utilities and contingency plan in case of any disruption;
Utility Requirement Sources
Power/ Electricity
Power requirement of the company is about 3,200 Kw/hour per day.
The plant is based on 100% captive power. Electricity requirement of the factory is met up from captive gas generators situated in the factory premises. For this purpose, the factory has 4 captive gas generators having capacity of 900 Kw each.
Gas
The company requires about 555,555 cubic meter of gas per month for running the captive gas generators. Other than this, the company also requires very insignificant amount of Oxygen, LP gas, Argon gas etc. for repair & maintenance, cutting and welding.
Bakhrabad Gas Systems Ltd. (now the Chittagong Division transferred under Karnaphuli Gas Distribution Company Ltd.) supplies required gas for the company. Whereas, Oxygen, LP gas, Argon gas etc. are procured from different vendors and suppliers.
63
Water The company requires about 95,000 Gallons of water per day for cooling tower, chiller etc.
The factory gets its water supply from its own deep tube-well.
Other utilities
To run the day to day business of the organization and for smooth correspondence purpose utilities like telecommunication services and internet services are required
The Company avails internet services from Chittagong Online Ltd. (availed dedicated lease line) for telecommunication services. The Company also has availed 5 land Phone connection from BTCL.
Contingency plan for any disruption of sourcing utilities
If any source of utilities disrupts, the Company have the following contingency plan:
(a) Standby engineer and maintenance team to emergency repair of generator (b) Use of alternative generator in case of any shutdown
(xii) Names, address(s), telephone number, web address, e-mail and fax number of the customers who account for 10% or more of the company’s products or services with amount and percentage thereof;
The Company has no such customers who contribute 10% or more revenues of the Company.
(xiii) Names, address(s), telephone number, web address, e-mail and fax number of the suppliers from whom the issuer purchases 10% or more of its raw material/ finished goods with amount and percentage thereof;
Name Of Supplier Address, Tel And Fax E-Mail &Website FY 2017
USD BDT %
PT POLYCHEM INDONESIA TBK.
WISMA 46-KOTA BNI LT.20, JL. JEND. SUDIRMAN KAV.1, JAKARTA 10220 INDONESIA. TEL:62 21 5512896, 62 21 5512896. FAX: 62 21 57945832, 62 21 57945834, 62 21 5512194
Email: [email protected] WEB: www.polychemindo.com
1,61,595.00 1,32,10,392 10%
above
(xiv) Description of any contract which the issuer has with its principal suppliers or customers showing the total amount and quantity of transaction for which the contract is made and the duration of the contract. If there is not any of such contract, a declaration is to be disclosed duly signed by CEO or MD, CFO and Chairman on behalf of Board of Directors
The company has not entered into any future contractual liability and has no plan to enter into any contractual obligation within next one year other than normal course of business.
To whom it may concern
Declaration regarding Contract with Principal suppliers or customers
We, on behalf of the Board of Directors certify that the Mohammad Elias Brothers POY Manufacturing Plant Limited. did not enter into any contract with its principal suppliers or customers.
Declaration by the management of Mohammad Elias Brothers POY Manufacturing Plant Limited
Sd/- Sd/- Sd/- Sd/-
Md. Mozaffor Ahmed Md. Shahidullah Khan Mohd. Rezaul Karim Sydul Karim
Company Secretary Chief Financial Officer Director & Managing Director Chairman (xv) Description of licenses, registrations, NOC and permissions obtained by the issuer with issue, renewal and expiry dates
Sl. Name of Licenses, registration, NOC
and permission
License Issuer/Issuing Authority
Registration/Certificate/ License No.
Issue Date Date of renewal
Date of expiry
1 Certificate of Incorporation
Registrar of Joint Stock companies and Firms
C-4410/2002 01/08/2002 N/A N/A
2 TIN Certificate National Board of
Revenue, Bangladesh E-TIN:849708878669/C-
45(Companies) 17.08.2013 N/A N/A
3 VAT Certificate Customs, Excise and
VAT Commission rate, Bangladesh
2101010761 Area Code: 20401
04.04.2005 N/A N/A
4 IRC Controller of Export and
Import 105412 19/4/2000 03/07/2017 2017-18
5 Trade License Chittagong City
Corporation 176059 7/7/2015 12/07/2017 June 2018
64
6 Factory License Dy Chief Inspector of Factories, Govt. of the Peoples Republic of
Bangladesh 3674/Chittagong 13/06/2007 09/07/2017 June 2018
7 Fire License Fire Service and Civil
Defense Chottro- 1135/12-13 10/07/2012 24/07/2017 June 2018
8 Environmental
Clearance Certificate Department of Environment,
Chittagong 22.02.1500.162.72.028.16.158 15/01/2009 13/03/2017 12/03/2018
9 BOI license Board of Investment,
Bangladesh 20040512- C 25/05/2004 N/A N/A
10 Membership
certificate
Chittagong Metropolitan Chamber of Commerce
and Industry 1769 06/03/ 2017 06/03/ 2017 31/12/2017
(xvi) Description of any material patents, trademarks, licenses or royalty agreements;
The Company does not have any material patents, trademarks, licenses or royalty agreements.
(xvii) Number of total employees and number of full-time employees;
The total number of employees of MEBPOY is 263. All of them are permanent employees. The details have been provided below:
Salary Range ( Monthly) Total
Employee
Officers & Staff Worker & Employee
Head Office Factory Head Office Factory
Below 3,000 - - - - -
Above 3,000 263 24 64 - 175
For the year ended 263 24 64 - 175
(xviii) A brief description of business strategy;
MEBPOY has modern machineries and technology that ensures quality products. Quality is main concern while formulating strategy. The Company tries to produce goods with cheap cost so that they can get competitive advantages over their competitors. They also believe in providing customizing products to customer as per need basis so that they can get maximum market share of products. So innovation is always there.
(xix) A table containing the existing installed capacities for each product or service, capacity utilization for these products or services in the previous years, projected capacities for existing as well as proposed products or services and the assumptions for future capacity utilization for the next three years in respect of existing as well as proposed products or services. If the projected capacity utilization is higher than the actual average capacity utilization, rationale to achieve the projected levels.
Existing capacity and its utilizations
As per Audited Financial Statements for the period ended September 30, 2017
Particulars Licensed capacity per
annum in kg Installed capacity per
annum in kg Actual production in kg % of capacity utilization
POY / DTY 10,500,000 9,800,000 2,216,326 22.62%
Projected capacity and its utilizations
Post expansion project as an integrated unit will have the following installed capacity:
Products Unit Installed Capacity Capacity Utilization for this Products Actual Capacity Utilization (%)
30.06.2018 30.06.2019 30.06.2020 30.06.2018 30.06.2019 30.06.2020 30.06.2018 30.06.2019 30.06.2020
FDY MT/Day 8 8 8 6 7 6.75 75.00% 87.50% 84.37%
(e) Description of Property: Contain the following information in respect of properties of the issuer namely: -
(i) Location and area of the land, building, principal plants and other property of the company and the condition thereof;
Sl. Location Area Condition
Land
1 49/P, Kalurghat Heavy Industrial Area, Chittagong-4100, Bangladesh
111.65 Katha
Developed land surrounded by brick wall. Factory premises are situated on the above land.
Building
1 Building-1: DTY Plant with office 25,505 sft.
Please see note bellow 2 Building-2: DTY Plant 75,975 sft.
3 Building-3: POY Plant 36,904 sft.
Registered office:
As-Salam Tower (7th Floor) 57, Agrabad Commercial Area, Chittagong, Bangladesh
7200 sft. The Registered office is on rented premise.
Principal plant
65
1 49/P, Kalurghat Heavy Industrial Area, Chittagong-4100, Bangladesh
111.65 Katha
The Factory of the Company is situated on leasehold land. The land was originally leased by Pioneer Timber Deport & Saw Mills of Patharghata from the Chittagong Development Authority, for a period of 99 years commencing from 26 May 1964. Later on with due permission from Chittagong Development Authority the land was transferred to Mohammed Elias Brothers POY Manufacturing Plant Limited via registered deed. The land of the Company is under registered mortgage deed with Trust Bank Limited for the long-term loan sanctioned to the Company and Trust Bank Limited has Pari-Passue 2nd charge registered with RJSC over all present & future fixed & floating assets.
Other property
1 Other property of the company is situated /installed at registered office, corporate office and plant
The entire property are in the possession of the issuer and are in
good with secure condition
Note-1 Details of Building
Name of Building Occupied by
2 storied office building
Ground Floor AHU & Air compressors room, pump house, Quality control room etc.
1st Floor Admin Office
Building-2: DTY Plant
Name of Building Occupied by
2 storied building (partly 4 storied)
Ground Floor Raw materials go-down, finished goods (transit) go-down, gas generator, AHU, Air
compressors, Maintenance floor and 4 numbers DTY machine
1st Floor 8 numbers DTY machine, quality control floor, laboratory, Air compressor etc.
2nd floor (Partly) Dormitory for Staff (Part of the building above quality control room)
3rd floor (Partly) Dormitory for Officer (Part of the building above Dormitory for Staff)
Building-3: POY Plant
(ii) Whether the property is owned by the company or taken on lease;
The Factory of the Company is situated on leasehold land. The land was originally leased by Pioneer Timber Deport & Saw Mills of Patharghata from the Chittagong Development Authority, for a period of 99 years commencing from 26 May 1964. Later on with due permission from Chittagong Development Authority the land was transferred to Mohammed Elias Brothers POY Manufacturing Plant Limited via registered deed. The land of the Company is under registered mortgage deed with Trust Bank Limited for the long-term loan sanctioned to the Company and Trust Bank Limited has Pari-Passue 2nd charge registered with RJSC over all present & future fixed & floating assets. which are already disclosed in annexure-A of the Audited Financial Statement as on September 30, 2017
(iii) Dates of purchase, last payment date of current rent (LvRbv) and mutation date of lands, deed value and other costs
including details of land development cost, if any and current use thereof;
Deed No. Date of
Purchase Last payment date of rent
Mutation with date Area of land Deed value
in Taka Other Cost including
land development cost Current use of
land
6045 21.10.2010 23.1.2017 489 dated: 26.09.2011 111.65 Katha 6.10 crore *11.85 crore Factory building
As per Audited financial as on September 30, 2017 value of lease hold land and land development is 17.95 crore.
The difference of cost value and deed value as on September 30, 2017 is land development cost.
Name of Building Occupied by
6 storied building
Ground Floor AHU room, Chillers, Compressors, Pumps, HP Dryer, Gas Generator, Chips conveying area, Lift, Pump house, Water softening plant.
1st Floor, Mezzanine floor Take-up/Winders area, Main Control Circuit (MCC) room, Electrical & Mechanical maintenance room, Bobbin Store area etc.
2nd Floor Spin finish area, Quench area, Control panel, Pack assembling room & cooling Towers.
3rd Floor Extruders, CPF pre heating area, Burn out room etc.
4th Floor L.P. air dryer and control panel
5th Floor (42 mtr. Chips drying tower)
Dryer heater, Crystallizer heater & Blower cyclone and wet chips hopper etc.
66
Revaluation of Land:
Particulars Nature and tenure of land Value prior to
revaluation Taka
Value after revaluation
Taka
Revaluation Reserve
Taka
111.65 Katha land located at 49/P Kalurghat CDA Heavy Industrial Area, Chittagong-4100
Lease hold land, original tenure is 99 years from 26/05/1964, remaining tenure on valuation date is 52 years
165,990,650 1,618,490,000 1,452,499,350
iv) The names of the persons from whom the lands have been acquired or proposed to be acquired along with the cost of acquisition and relation, if any, of such persons to the issuer or any sponsor or director thereof;
Land already acquired
Name of seller Seller's relation with issuer/ Sponsor/director Cost of Acquisition
(Amount in Tk.)
Pioneer Timber Deport & Saw Mills No relationship with issuer/Sponsor/Director 61,000,000
Land proposed to be acquired
Since the expansion project shall be situated on the existing land, the Company has no plan to purchase land or acquire of land till date in this regard.
(v) Details of whether the issuer has received all the approvals pertaining to use of the land, if required;
The Company has received all the approval from relevant authority pertaining to use of land.
(vi) If the property is owned by the issuer, whether there is a mortgage or other type of charge on the property, with name of the mortgagee;
Leasehold Land: Name of
Mortgagee
Mortgage
Deed No. Date Description of property Area
Trust Bank
Limited 3507 09.09.2014
Land and building located at mouza:
Char Rangamatia, Plot: 49, C.D.A’s
Kalurghat Heavy Industrial Estate,
Chittagong-4100, Bangladesh
The land of the Company is under registered
mortgage deed for the long-term loan sanctioned to
the Company and Trust Bank Limited has Pari-
Passue 2nd charge registered with RJSC over all
present & future fixed & floating assets.
(vii) If the property is taken on lease, the expiration dates of the lease with name of the lessor, principal terms and conditions of the lease agreements and details of payment;
No Property is taken by the Company under lease agreement.
(viii) Dates of purchase of plant and machineries along with sellers name, address, years of sale, condition when purchased, country of origin, useful economic life at purchase and remaining economic life, purchase price and written down value;
Sl. Name of Machinery Qty.
(Sets)
Condition when
purchased Brand Seller Name
Country of origin
Date/Year of
Purchase
Useful Economic life
Remaining Economy
life
Purchase Value(BDT)
WDV as on
30.09.2017
Plant and Machinery :
01 Plant & Machinery N/A Brand New
Barmag Barmag Zwelgnl
ederlassung der saurer Gmb H&Co
German 2006 25 14 133,436,179 68,935,093
02 Power Cables 2947 Mtr.
Brand New
N/A Shah Amanat Traders Bangladesh 2015 12 10 37,036,325 29,928,418
03 Plant & Machinery (02 Sets HDT Machine)
02 Sets Brand New
Himson Himson
Tex.Engg.Inds.Pvt.Ltd India 2008 30 21 49,808,275 2,952,167
04 02 Sets HDT Machine-M SDS-700B
02 Sets Brand New
Himson Himson
Tex.Engg.Inds.Pvt.Ltd India 1989 30 02 109,620,478 10,634,892
05 Plant & Machinery N/A Brand New
Barmag Barmag
Zwelgnlederlassung der saurer Gmb H&Co
German 2008 30 21 17,698,032 4,491,618
06 Air Conditioning System (8 Machine)
06 Sets Brand New
Kirlosker Kirlosker Ltd India 2008 25 16 15,667,582 839,361
07 Plant & Machinery (Pump and Others)
25 Nos Brand New
KSB KSB India 2009 10 02 2,488,780 193,354
08 MDT Machine: 8 Nos 08 Sets Brand New
Murata Toyo-Menka Kaisha Ltd. Japan 1990 30 03 96,254,600 1,252,727
09 Gas Generator 01 Sets Brand New
Waukesha Waukesha Engine
Dresser Inc. USA 1991 30 04 30,420,480 6,611,306
10 Air Compressor (02 Set ) 02 Sets Brand New
R 30 Screw Air
Compressor
Tahser Tazyikli Hava Makineleri San Tic A. S .
Turkey 2007 25 15 17,764,870 3,663,321
Sub-Total 510,195,601 129,502,256
Leased Plant and Machinery :
01
Capital Machinery for Extruding Man Made Polyester Yarn (Main Machine for First Line:12 winders*12=144 position)
01 Sets Brand New
Barmag Barmag
Zwelgnlederlassung der saurer Gmb H&Co
Germany 2006 35 24
253,117,887
41,038,957
02 Auxiliary Machinery for Low Pressure Air Dryer, High Pressure Air
03 Sets Brand New
Indcon Indcon Projects
Equipment India 2006 30 19 9,975,020 1,617,284
67
Dryer,Conveyar for POY Plant
03 Air Conditioning System of 2 Liner Polyester Yarn Extruding Plant
01 Lot Brand New
ACV ACV Systems Pvt.Ltd. India 2006 30 19 31,800,559 5,155,959
04
Auxiliary Machinery for Extruding Polyester Yarn OFS Horizontal Duplex Version Dual Handle Operated Filter Unit
03 Case Brand New
Lunarmech Lunarmech Machinen
enfabrik Ltd. India 2006 30 19 6,421,709 1,041,178
05 Water-cooled Screw Chiller Modle:YRTDTDT 1555C
02 Sets Brand New
York York International Pte
Ltd USA 2006 30 19 19,325,736 3,133,356
06
POY Machinery (Crystalliser, Crystallser Intel nozzle, Crystalliser support brackets, Dryer, Dryer Heater, Cyclone,Cyclone support bracket, Economiser etc.
Brand New
N/A The Engineer Ing.Pvt
Ltd. India 2006 25
14
27,305,419 4,427,132
07
Brand New Eclectic Generating (Waukesha) Model : VHP5904GSID 2 sets
02 Sets Brand New
Waukesha Waukesha Engine
Dresser Inc. USA 2006 30 19 100,183,940 16,243,191
08 Air Compressure 2 nos 02 Sets Brand New
Kirlosker Kirlosker Ltd India 2006 30 19
13,282,113 2,153,462
09
Capital Machinery for Extruding Man Made Polyester Yarn (Main Machine for First Line: 12 winders*12=144 position)
73 Packages
Brand New
Barmag Barmag
Zwelgnlederlassung der saurer Gmb H&Co
Germany 2008 30 21
207,069,085 46,467,668
10
Capital Machinery :(Dry Chips Hopper, Dowtherm Vepouriser with Heaters, Dowtherm Vessel, Spin Finish Storage Type Thermo Couple Duel Point, Dowtherm Panel, Laboratory Equipments
01 Lot Brand New
Indicon Corolla Marketing
Pvt,Ltd. India 2008 30 21 26,934,834 6,044,356
11
Filter Candle Elements for Continuous Polymer Filter, (CPF) suitable for CPF Model No. OSF
60 Nos
Brand New
Pall Pall India Pvt Ltd. India 2008 25 16 2,234,700 501,483
12 Capital Machinery : Automatic Tensile Tester Model STATIMAT ME
01 Set Brand New
Textechno Textechno Herbert Stein
GmbH & Co KG Germany 2008 30 21 14,166,568 3,179,072
13
Horizontal Duplex Version Duel Handle Operated Continuous Model: UDF-800 T, with additional Housing and Accessories
01 No. Brand New
Saitech Saitech Mechfab Pvt, Ltd India 2008 25 16 6,809,528 1,528,105
14
2 Set Kirlosker make Packaged Air Compressor Model No. T-BTD-QM with all standard Accessories
02 Set Brand New
Kirlosker Kirlosker Ltd India 2008 30 21 16,201,250 3,635,669
15
Filter Cleaning and Pack room POY project, VIBRONICS make Ultrasonic Cleaning System
01 Lot Brand New
Vibronics Vibronics Private Ltd. India 2007 25 15 1,110,658 211,855
16
Acid Bath 01 no., Hot Water Bath 01 no., Teg Bath (Triple Pot) 02 nos., Fluidised Bed Pac Clearing System 01 no., Inter FloorTube 12 nos. Bend For Quench Chamber
01 Lot Brand New
Sathe Sathe Engineering Co
Pvt Ltd India 2007 25 15 8,427,686 1,607,547
17
FRP Cooling Tower Model No. CF-612-2 (Twin Cells), Capacity 150-Cum/Hr/Cell (02 nos) FRP Cooling Tower Model No. CF-632 Capacity 225-Cum/Hr/Cell (02 nos)
04 Nos Brand New
Southern Southern Cooling Towers Pvt Ltd,
India 2007 25 15 7,563,981 1,442,800
18 KINGER PISTON VALVES (Model - KVBN)
01 Lot Brand New
Uni Klinger Uni Klinger Ltd India 2007 25 15 1,014,944 193,598
19
Filter Candle Elements for Continuous Polymer Filter, (CPF) suitable for CPF Model
60 Nos Brand New
Pall Pall India Pvt Ltd India 2007 25 15 1,835,055 350,031
20 Auxiliary Machinery 423 Pcs Brand New
AAstha AAstha Engineers India 2007 25 15 6,767,561 1,290,885
21
Capital Machinery for Delta make Furnace & Ovens Burn out Furance-01 nos, Pack pre-heating Ovens-02 nos. CPF Preheating oven- 01 no.
01 Set Brand New
Delta Delta Furnaces India 2007 25 15 4,115,577 785,030
22
Capital Machinery for Dowtherm Vapourisor Thyrister Control Panel & Related Various instruments.
01 Set Brand New
Adroit Adroit Control
Engineers Pvt,Ltd. India 2007 25 15 5,411,293 1,032,182
23 Capital Machinery for Extruding Polyester Yarn (Water Treatment Plant)
01 Lot Brand New
Hyper Hyper Filteration
Pvt.Ltd India 2007 25 15 6,948,197 1,325,330
24 Cable Elevator, Motor etc. 2000 Mtr Brand New
BRB BD Pradise Parason
BRB BD. Ltd Pradise BD. Ltd Parason (India )
Bangladesh, India
2006 30 19 28,163,380
4,566,236
25 02 Sets HDT Machine –M HDS-VX3N
02 Sets Brand New
Himson Himson
Tex.Engg.Inds.Pvt.Ltd India 1988 30 1 99,191,412 32,835,981
26 Air Conditioning System 08 Sets Brand New
Indicon Corolla Marketing
Pvt,Ltd. India 2007 30
20
23,371,283 4,819,427
27 DTY Machinery 02 Sets Brand New
Himson Himson
Tex.Engg.Inds.Pvt.Ltd India 2008 30 21 92,986,080 26,539,510
Sub-total 1,021,735,455 213,167,282
Total 1,531,931,056 342,669,538
68
(ix) Details of the machineries required to be bought by the issuer, cost of the machineries, name of the suppliers, date of placement of order and the date or expected date of supply, etc.
A Items Cost of the
Machineries Amount in BDT
Name of the Suppliers/ Inventors
Date of Placement of Order
Expected Date of Supply
1 Oerlikon-Barmag Make high speed Spinning and Winding machine
157,645,789 Oerlikon-Barmag
After Receiving IPO Fund
180 Days from date of
issue of Purchase
Order
2 PET Chips Dryer - Capacity 35 tons/day 7,150,000
Indicon projects & equipments ltd.
a. LP Air Dryer 307,500
b. Dry Chips Hopper 1no. 274,000
c. Wet Chips Hopper 1no. 238,000
d. Insulation Material 5,440,000
3 Chips Charging system
a. Hoist 2 nos. 146,000 Five Star
Engineering
4 HTM - Boiler System (cap 900 L) 1 no. 1,640,000 Local Supplier
5 Spin finish preparation equipment 369,000 Local Suppler
6 Spin finish supply equipment 262,000 Local Suppler
7 Auxiliary Equipment 5,000,000
SOSSNA GMBH a. Spinnerets inspection m/c 200,000
b. Vacuum furnace 300,000
c. Pack Pre Heater - 1 no 820,000
8 AHU 14,600,000 Aryan Industries Ltd.
9 Chiller - 400 TR - vapor Absorption base - 1 no 5,300,000
YORK Industries Ltd. a. Chilled Water Pump 984,000
b. Piping, Valve & Fittings 2,460,000
c. Cooling water pump 1,230,000
10 Comp air drying Unit - 1500 cfm - 2 no 1,640,000 Star Dynamic
Enterprise.
11 Conversion of Comp -LP to HP - KPCL - 750 cfm - 5 bar to 725 - 10 Bar
246,000 KIRLOSKAR Ltd.
12 Piping, Valve & fittings 984,000 Local suppliers
13 Computerized FDY - Packing conveyor - 1 no 2,460,000 Textile Engineering Industries Pvt. Ltd.
14 winder maintenance equipment 1,589,345 Oerlikon-Barmag
15 Intermingling jets facility - 2 sets 492,000 Oerlikon-Barmag
16 Air Receiver tanks - 2 Nos. (20 NM3) 820,000 Oerlikon-Barmag
17 Electrical Infrastructure 4,500,000 Local suppliers
18 Civil Infrastructure 9,225,000 Local suppliers
19 Mechanical Infrastructure 10,505,000 Local suppliers
20 Commissioning Expenses: Technicians transportation-boarding/lodging etc.
2,800,000 Local suppliers
21 Pre-operative Expenses and trial run 4,866,805 Local suppliers
Total utilization for FDY Project 244,494,439
(x) In case the machineries are yet to be delivered, the date of quotations relied upon for the cost estimates given shall also be mentioned;
The Company did not open any L/C for procuring the machineries.
(xi) If plant is purchased in brand new condition then it should be mentioned;
The plant was purchased in brand new condition
(xii) Details of the second hand or reconditioned machineries bought or proposed to be bought, if any, including the age of the machineries, balance estimated useful life, etc. as per PSI certificates of the said machineries as submitted to the Commission
The Company did not buy or propose to buy any re-conditioned or second- hand plant & machinery. The Company has no plan to purchase second hand or reconditioned machineries.
69
(xiii) A physical verification report by the Issue Manager(s) regarding the properties as submitted to the Commission;
V I S I T R E P O R T Particulars
Name of Company : Mohammed Elias Brothers POY Manufacturing Plant Limited
Registered Office : As-Salam Tower (7th Floor), 57, Agrabad C/A, Chittagong-4100
Corporate Office : As-Salam Tower (7th Floor), 57, Agrabad C/A, Chittagong-4100
Plant Location : 49/P, Kalurghat Heavy Industrial Area, Chittagong-4100
Visited by the officials of Prime Finance Capital Management Ltd., AIBL Capital Management Ltd., AB Investment Ltd. On 26 December 2017, time 9.00 a.m. to 2.00 p.m.
: 1. Mr. Mohammad Rajibul Islam
2. Mr. Mohammad Rukonul Islam
3. Mr. Muhammad Sekandar Ali
4. Mr. Md. Jamshed Al Ashadur Rahman
AVP & Head of Public Issue, Prime Finance Capital Mgt. Ltd. Senior Executive Officer, AIBL Capital Management Ltd. Senior Executive Officer, Prime Finance Capital Management Ltd. Executive, AB Investment Ltd.
Accompanied by the officials of MEBPOY Ltd. :
1. Mr. Sydul Karim Chairman
2. Mr. Mohd. Rezaul Karim Director & Managing Director
3. Mr. Md. Shahidullah Khan
Chief Financial Officer
4. Mr. Md. Mozaffor Ahmed Company Secretary
5. Mr. Md. Ashraf Hossain DGM, Admin & HRM
Purpose of Visit: The Companies signed an issue management agreement on 9 October 2017 with Prime Finance Capital Management Ltd., AIBL Capital Management Ltd., AB Investment Ltd., for public issue of shares through Initial Public Offering (IPO). In this respect, the issue management team visited the plant as a part of due diligence of issue manager on 26 December 2017 in order to get the operational status of the Company before public issue of shares.
Project brief
Project type : Textile (Polyester Yearn)
Project location : 49/P, Kalurghat Heavy Industrial Area, Chittagong-4100
Project nature : To manufacture POY & Draw Textured Yearn (DTY)
Plant and Machinery : Different types of Yearn manufacturing machineries
Management Team : Mr. Sydul Karim Chairman
Mr. Mohd. Rezaul Karim Director & Managing Director
Factory location and entrance The Issue Management team visited the factory premises as on 26 December 2017 the factory is situated at Kalurghat Heavy Industrial Area, Chittagong. There are a steel gate in front of the factory entrance and a security room along with a big signboard showing the company’s name, the entire factory is surrounded by boundary wall and fully secured. Inside of the factory There are three building found in the factory premises. All Civil Construction of the factory has already been completed and the factory is found in full operation during our visit. The total project area is surrounded by brick wall. Sufficient land space and sanitary facilities are available within factory premises. Details of factory building: Factory Building of the Company is situated at Mouza- Char Rangamatia CDA’S Kalurghat Heavy Industrial Estate, JL No. 13, B.S. Dag No 1486, Kalurghat Heavy Industrial Area, Chittagong-4100 Building-1: DTY Plant with office
Name of Building Occupied by
2 storied office building
Ground Floor AHU & Air compressors room, pump house, Quality control room etc.
1st Floor Admin Office
Building-2: DTY Plant
Name of Building Occupied by
2 storied building (partly 4 storied)
Ground Floor Raw materials godown, finished goods (transit) godown, gas generator, AHU, Air compressors, Maintenance floor and 4 numbers DTY machine
1st Floor 8 numbers DTY machine, quality control floor, laboratory, Air compressor etc.
2nd floor (Partly) Dormitory for Staff (Part of the building above quality control room)
3rd floor (Partly) Dormitory for Officer (Part of the building above Dormitory for Staff)
Building-3: POY Plant
Name of Building Occupied by
6 storied building
Ground Floor AHU room, Chillers, Compressors, Pumps, HP Dryer, Gas Generator, Chips conveying area, Lift, Pump house, Water softening plant.
1st Floor, Mezzanine floor Take-up/Winders area, Main Control Circuit (MCC) room, Electrical & Mechanical maintenance room, Bobbin Store area etc.
2nd Floor Spin finish area, Quench area, Control panel, Pack assembling room & cooling Towers.
70
Physical Existence of Plant & Machinery, Equipment, Furniture & Fixtures, Inventories and Manpower Strength: During the course of visit following plant & machinery, equipment, furniture & fixtures were physically found: Particulars of Plant & Machineries: The factory of the Company is equipped with modern brand new machinery imported from German, Turkey, USA, Japan, and India along with locally procured machinery to maintain Standard quality of products of the company. During our visit we found that all machineries were in the factory premises and were in operation. Working Environment: During our visit to the plant, we found that all workers were engaged in their scheduled work. We communicated some of the workers about the working environment of the factory. They expressed their satisfaction about the entire environment of the factory. Again, we found that there are sufficient facilities of sanitation, open space, corridor, fire protective devices, fire emergency exit and air ventilation system for comfortable workplace for the workers.
Approved by
Sd/- Sd/- Sd/-
Sheikh Ashraful Haque Chief Executive Officer
AB Investment Ltd.
Muhammad Husain Ahmad Faruqi Chief Executive Officer
AIBL Capital Management Ltd.
M. Mosharraf Hossain FCA, PhD Managing Director & CEO
Prime Finance Capital Management Ltd.
(xiv) If the issuer is entitled to any intellectual property right or intangible asset, full description of the property, whether the same are legally held by the issuer and whether all formalities in this regard have been complied with;
The Company does not have any intellectual property right or intangible assets.
(xv) Full description of other properties of the issuer;
The description of other properties of the Company has been described as follows: As per audited accounts as on September 30, 2017
Category of properties Total cost in Taka WDV as on September 30, 2017 (Taka)
Building 157,362,745 96,953,776
Plant & Machinery 510,195,601 129,502,256
Furniture, Fixture and Equipment 441,190,125 137,121,102
Vehicle 1,780,569 163,275
Leased Plant & Machinery 1,021,735,455 213,167,282
Total 2,132,264,495 576,907,692
(f) Plan of Operation and Discussion of Financial Condition:
(i) If the issuer has not started its commercial operation, the company’s plan of operations for the period which would be required to start commercial operation which shall, among others, include:-
a) Projected financial statements up to the year of commercial operation;
b) Rationale behind the projection;
c) Any expected significant changes in the issuer’s policy or business strategies;
d) Detail plan of capital investment with break-up;
e) Summary of feasibility report, etc.
This section is not applicable as the Company is already in operation.
(ii) If the issuer had been in operation, the issuer’s revenue and results from operation, financial position and changes in financial position and cash flows for the last five years or from commercial operation, which is shorter, shall be furnished in tabular form which shall, among others, include the following information;
Amount in Taka
Particulars 30-Sep-17 30-Jun-17 30-June-16 31-Dec-15 31-Dec-14 31-Dec-13 31-Dec-12
Statement of Operating Result
Total revenue 288,794,411 698,250,890 134,856,507 1,102,563,159 699,462,644 1,182,834,175 1,329,670,924
Gross profit 112,438,948 243,251,522 87,364,506 230,525,301 214,825,484 270,209,697 232,363,185
Net profit before tax 68,018,667 112,271,641 38,701,449 112,988,491 153,658,652 171,671,244 98,311,114
Net profit after tax 57,258,574 111,757,912 32,896,232 96,026,537 130,554,800 141,942,322 78,332,304
EPS (Basic) 0.34 0.67 0.20 0.57 0.78 0.84 0.52
EPS (Restated) - - - - - - 0.47
3rd Floor Extruders, CPF pre heating area, Burn out room etc.
4th Floor L.P. air dryer and control panel
5th Floor (42 mtr. Chips drying tower)
Dryer heater, Crystallizer heater & Blower cyclone and wet chips hopper etc.
71
Statement of financial position
Total assets 5,032,111,172 4,914,113,404 4,603,708,365 4,504,583,613 4,116,214,728 3,869,877,296 4,059,060,438
Shareholder’s equity 3,753,321,954 3,696,063,379 3,595,424,090 3,562,527,858 3,466,922,433 3,336,367,634 3,221,350,703
No. of shares 168,000,000 168,000,000 168,000,000 168,000,000 168,000,000 168,000,000 150,000,000
Face value 10 10 10 10 10 10 10
NAV per share with revaluation reserve
22.34 22.00 21.40 21.21 20.64 19.86 21.48
NAV per share with revaluation reserve (Restated)
- - - - - - 19.17
NAV per share without revaluation reserve
13.70 13.35 12.76 12.56 11.99 11.21 11.79
NAV per share without revaluation reserve (Restated)
- - - - - - 10.53
Changes in financial position
Share capital 1,680,000,000 1,680,000,000 1,680,000,000 1,680,000,000 1,680,000,000 1,680,000,000 1,500,000,000
Share money deposit - - - - - - -
Revaluation surplus 1,452,499,350 1,452,499,350 1,452,499,350 1,452,499,350 1,452,499,350 1,452,499,350 1,452,499,350
Retained earnings 620,822,604 563,564,029 462,924,740 430,028,508 334,423,083 203,868,284 268,851,353
Statement of cash flow
Net cash flow from operating activities
3,713,749 25,949,388 15,000,692 14,433,722 87,206,776 -284,876,393 102,742,046
Net cash flow from Investing activities
-23,202,830 -22,000,000 -205,240 -80,355,907 -185,583,164 544,420,197 -5,939,681
Net cash flow from Financing activities
8,431,013 -3,812,224 -7,730,199 164,727,442 114,123,346 -65,303,616 -203,889,715
(a) Internal and external sources of cash;
Particulars 30-Sep-17 30-Jun-17 30-June-16 31-Dec-15 31-Dec-14 31-Dec-13 31-Dec-12
Internal sources of Cash:
Share capital 1,680,000,000 1,680,000,000 1,680,000,000 1,680,000,000 1,680,000,000 1,680,000,000 1,500,000,000
Share money deposit - - - - - - -
Retained earnings 620,822,604 563,564,029 462,924,740 430,028,508 334,423,083 203,868,284 268,851,353
Sub-Total A 2,300,822,604 2,243,564,029 2,142,924,740 2,110,028,508 2,014,423,083 1,883,868,284 1,768,851,353
External sources of Cash:
Long term loan net off current maturity
468,748,021 474,817,142 285,924,156 196,449,047 15,270,000 8,727,644 -
Current portion of long term loan 101,750,000 101,750,000 180,000,000 128,490,000 143,516,595 15,231,126 24,430,362
Finance lease obligation net off current maturity
126,205,185 120,471,167 119,351,052 109,883,149 114,041,929 54,557,735 102,650,100
Current portion of finance lease obligation
64,507,428 64,507,428 66,150,972 66,150,984 54,177,948 83,779,568 85,231,482
Short term loan 197,555,606 161,390,167 195,226,781 324,714,972 258,271,447 308,858,500 324,146,244
Sub-Total B 958,766,240 922,935,904 846,652,961 825,688,152 585,277,920 471,154,573 536,458,188
Grand Total (A+B) 3,259,588,844 3,166,499,932 2,989,577,702 2,935,716,660 2,599,701,003 2,355,022,857 2,305,309,541
(b) Any material commitments for capital expenditure and expected sources of funds for such expenditure;
The Company has not yet made any material commitment for capital expenditure except for those that are required in the course of carrying out of normal business operations.
(c) Causes for any material changes from period to period in revenues, cost of goods sold, other operating expenses and net income;
Particulars 30-Sep-17 3 months
30-Jun-17 30-June-16 6 months
31-Dec-15 31-Dec-14 31-Dec-13 31-Dec-12
Revenue 288,794,411 698,250,890 134,856,507 1,102,563,159 699,462,644 1,182,834,175 1,329,670,924
Year to year changes in revenue (%) - - - 57.63 (40.87) (11.04) (8.90)
Cost of goods sold (COGS) 175,702,069 453,684,333 47,101,289 869,015,159 480,818,559 871,076,427 1,088,825,788
Year to year changes in COGS (%) - - - 80.74 (44.80) (20.00) (11.42)
Gross profit (GP) 112,438,948 243,251,522 87,364,506 230,525,301 214,825,484 270,209,697 232,363,185
Year to year changes in Gross Profit (%) - - 7.31 ( 20.50) 16.29 2.72
Operating expenses 14,273,418 46,586,168 18,423,687 39,227,294 30,052,481 82,537,982 79,064,830
Year to year changes in Operating expenses (%) - - - 30.53 (63.59) 4.39 (2.45)
Financial expenses 27,399,324 80,095,166 28,695,008 75,682,791 27,250,019 48,964,960 58,553,637
Year to year changes in Financial expenses (%) - - - 177.73 (44.35) (16.38) (11.64)
Net profit after tax 57,258,574 111,757,912 32,896,232 96,026,537 130,554,800 141,942,322 78,332,304
Year to year changes in Net Profit after tax (%) - - - (26.45) (8.02) 81.21 16.61
Causes for changes in year to year changes in revenue (%)
Revenue of the Company is upward trend.
Causes for changes of year to year of COGS
COGS change due to change in sells volume.
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Causes for changes of year to year of other Operating Expenses
Change in other operating expenses of the company due to change in sells volume.
Causes for changes of year to year of Net Income
Net income change due to changes in revenue.
(d) Any seasonal aspects of the issuer’s business
The operation of the company is not, in general, affected by any seasonal variances.
(e) Any known trends, events or uncertainties that may have material effect on the issuer’s future business;
There are no known trends, events or uncertainties that may effect on the future business of the Company except followings: ◊ Technological changes ◊ Changes in government policy ◊ Political unrest ◊ Natural calamities
(f) Any assets of the company used to pay off any liabilities;
No assets of the Company were used to pay off any liabilities of the Company.
(g) Any loan taken from or given to any related party or connected person of the issuer with details of the same;
No Loan was taken from or given to any related party or connected person of the Company during last five years.
(h) Any future contractual liabilities the issuer may enter into within next one year, and the impact, if any, on the financial fundamentals of the issuer;
The Company has no plan to enter into any future contractual liability within next one year except normal course of business and in relation to use of proceeds.
(i) The estimated amount, where applicable, of future capital expenditure;
Out of the IPO proceeds an estimated amount of Tk. 23.18 crore will be utilized for setting up a new production line for producing FDY (Fully Draw Yarn). Except that, company does not have any plan for capital expenditure in the near future other than normal course of business.
(j) Any VAT, income tax, customs duty or other tax liability which is yet to be paid, including any contingent liabilities stating why the same was not paid prior to the issuance of the prospectus. Updated income tax status for the last 5 years or from commercial operation, which is shorter;
The Company does not have any outstanding VAT, Income tax, custom duty and or other tax liability including any contingent liability yet to be paid as on September 30, 2017 except as follows:
VAT
VAT applicable @ 15% on tariff value (Sale value Per kg Tk. 10). (SRO#199/AIN/2010/548 Mushok Date: 10 June 2010)
Income tax Provision for corporate income tax is made @ 15% on estimated taxable profit in accordance with income tax laws (SRO no 193-ayn-incometax/2015). The income tax assessment status of the company since its incorporation is given below:
Year Assessment year Status
2012 2013-2014 Return submitted. Assessment completed. NBR demand Tk. 57,930,386
2013 2014-2015 Return submitted. Assessment completed. NBR demand Tk. 61,361,110
2014 2015-2016 Return submitted. Assessment completed. NBR demand Tk. 87,538,290
2015 2016-2017 Return submitted. Assessment under process.
2016 (Jan-June) 2016-2017 Return submitted. Assessment under process.
Custom Duty
As on 30 September 2017, the company has no custom duty outstanding.
Contingent Liability As per audited accounts for the period ended on September 30, 2017, the Company has the following contingent liabilities and commitments:
COMMITMENTS
Guarantee to Karnafuli Gas Distribution Co. Ltd. Tk. 7,568,000
Benapol Custom Tk. 170,000
Commitment under immature letter of credit Tk. 18,348,395 Total Tk. 26,086,395
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k) Any financial commitment, including lease commitment, the company had entered into during the past five years or from commercial operation, which is shorter, giving details as to how the liquidation was or is to be effected;
Operating lease during the last five years
The Registered Office of Mohammed Elias Brothers POY Manufacturing Plant Limited is situated on leased/rented accommodation as detailed below:
Particulars Lease agreement for Registered Office
Lessor L& M Builders (Pvt.) Limited
Leasee Mohammed Elias Brothers POY Manufacturing Plant
Date of lease agreement 1 July 2015
Effective date of Tenancy 1 July 2015
Period of lease 5 years
Date of lease expiration 30 June 2020
Description of leased asset 7,200 square feet of floor space situated at As Salam Tower (7th Floor), 57, Agrabad C/A, Chittagong-4100
Lease rent Tk. 42.35 per sft. and will be increased @10% after every 24 months
Renewal clause Rent may be renewed after expiry of 5 years under existing terms and conditions.
Financial lease commitment
There is no other financial lease commitment of the Company during the last five years except as detailed below:
Lessor Facility Agreement no. Reschedule
Date Reschedule
Amount Rate of Interest
Installment
IIDFC Ltd. Lease LF#16744/2014-0-2 04.01.2017 39,931,733 17% 1,169,026
IIDFC Ltd. Syn. Lease LF#031/2007-0-2 04.01.2017 35,631,301 17% 1,043,129
Premier Leasing Syn. Lease LF#0683 04.01.2017 90,773,657 17% 2,701,614
Phoenix Finance & Invt. Ltd.
Syn. Lease PLC/CTG-05/EL-15/05 15.12.2012 24,810,929 20% 461,850
(l) Details of all personnel related schemes for which the company has to make provision for in future years
Mohammed Elias Brothers POY Manufacturing Plant Limited considers its human resources as the most valuable assets of the
company and has been continuing to train, equip and groom its employees for building a strong foundation. The company
has a well-designed compensation plan and is offering festival bonus for attracting highly skilled professional staff with high
degree of integrity. Other than attractive remuneration package and festival bonus, the Company has already introduced
Workers Profit Participation (WPPF) policy and Contributory Provident Fund policy for employees benefit.
Personnel related scheme Description
Workers Profit Participation
(WPPF) policy
Workers profit participation policy has been adopted by the board and implemented in MEBPOY
since 2012.
Provident Fund policy Management of the company has a contributory provident fund policy for its employees which
are adopted since 2007. Every confirmed employee is entitled to enjoy its benefits.
Gratuity policy The Company has a formal gratuity policy. All permanent employees are entitled to receive basic
+ Dearness Allowance (DA) as gratuity for each year of service.
Group insurance The management of the company already decided to implement group Insurance which is
approved by the Board of the Company.
Assessment Year
Tax Provision Tax Claimed
by NBR Tax Rate
AIT Payment
Tax Payment
Net Payable / (Credit) Remarks
2010-2011 8,374,215 5,000 15% 116,571 8,487,700 -8,599,271 Tribunal completed
2011-2012 19,265,986 13,038,249 15% 781,375 19,984,620 -7,727,746 Tribunal completed
2012-2013 11,854,362 35,379,277 15% 1,547,259 13,907,200 19,924,818 Tribunal completed
2013-2014 14,355,032 57,930,386 15% 1,415,239 12,940,000 43,575,147 Assessment completed
2014-2015 25,750,686 61,361,110 15% 954,986 9,560,000 50,846,124 Assessment completed
2015-2016 17,251,686 87,538,290 15% 273,208 - 87,265,082 Assessment completed
2016-2017 12,603,678 Assessment under
process 15% 223,968 - 12,379,710 Return submitted
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(m) Breakdown of issue expenses
The total IPO expenses are estimated as follows:
Particulars Basis of Calculation Amount in Tk.
BSEC Fees: 1,050,000
Application Fee to Bangladesh Securities & Exchange Commission
Fixed 50,000
Consent Fee to Bangladesh Securities & Exchange Commission
@ 0.40% on the IPO Amount 1,000,000
Listing Related Expenses: 7,290,000
Prospectus Scrutiny Fees of DSE & CSE Tk. 50,000 Each 100,000
DSE & CSE Initial Listing Fees
@ 0.25% on Tk. 100 Million and
5,990,000 @ 0.15% on the rest of Paid-Up Capital but not more than 10 Million Each
Annual Listing Fee for DSE & CSE
@ 0.05% on Tk. 1,000 Million and
1,200,000 @ 0.02% on the rest of Paid-Up Capital but not more than 6 Lac Each
CDBL Fees and Expenses: 898,000
Security Deposit Fixed 500,000
Documentation Fee Fixed 2,500
Initial Public Offer Fee @0.015% on Total Paid-Up Capital 289,500
Annual Fee Fixed 100,000
Connection Fee Fixed 6,000
Commissions & Expenses: 537,500
Underwriting Commission Maximum 1% on 35% of the public offer amount
(including premium) 437,500
Auditors Certification & Audit Fee Lump Sum 100,000
Issue Management Fees: 1955,000
Manager to the Issue Fee Maximum 2.00% of the public offer amount 1,700,000
VAT on Manager to the Issue Fee 15% 255,000
Printing & Post IPO Expenses: 6,415,000
Publication of Prospectus (Estimated; to be Paid at Actual) 800,000
Abridged version of Prospectus and Notice in 4 daily newspaper
(Estimated; to be Paid at Actual) 800,000
Notice for Prospectus, Lottery, Refund etc. in 4 daily newspaper
(Estimated; to be Paid at Actual) 315,000
Lottery Conducting Expenses & BUET Fee (Estimated; to be Paid at Actual) 1,000,000
Data Processing and Share Software Charge (Estimated; to be Paid at Actual) 3,000,000
Courier Expenses (Estimated; to be Paid at Actual) 300,000
Administrative & Stationary Expense (Estimated; to be Paid at Actual) 200,000
Total 18,145,500
(n) If the issuer has revalued any of its assets, the name, qualification and experiences of the valuer and the reason for the revaluation, showing the value of the assets prior to the revaluation separately for each asset revalued in a manner which shall facilitate comparison between the historical value and the amount after revaluation and giving a summary of the valuation report along with basis of pricing and certificates required under the revaluation guideline of the Commission;
Particulars Description
Name of valuer A Revaluation of the Company’s lands was made on 12 December 2011 by Royal Inspection International Ltd. which has been duly certified by Rahman Mostafa Alam & Co., Chartered Accountants.
Qualification of valuer Royal Inspection International Ltd. has obtained ISO 9001:2000 certificate as the recognition of their quality management system
Experiences of the valuer
The valuer has long experience in conducting valuation of assets of some prominent companies. i. Sonali Bank Ltd.
ii. National Bank Ltd. iii. Southeast Bank Ltd. iv. Shahjalal Islami Bank Ltd. v. Basic Bank Ltd.
vi. Uttara Bank Ltd. vii. Bangladesh Shilpa Bank
viii. Bangladesh Krishi Bank ix. Islami Bank Bangladesh Ltd. x. Mutual Trust Bank Ltd.
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Reasons for the revaluation
The purpose of revaluation was to determine the fair market value of the lands of Mohammed Elias Brothers POY Manufacturing Plant Limited. The need for revaluation arose from the fact that the values of lands of the Company (as were stated in the books of accounts) were based on their acquisition cost (historical value), but those book values were far below their respective market values. Hence to determine the actual value and true picture of the Company, revaluation was done. Detail information on revaluation of assets of the Company is given below.
Summary of revaluation report
Particulars Nature and tenure of land Value prior to
revaluation Taka
Value after revaluation
Taka
Revaluation Reserve
Taka
111.62 Katha land located at 49/P Kalurghat CDA Heavy Industrial Area, Chittagong-4100
Lease hold land, original tenure is 99 years from 26/05/1964, remaining tenure on valuation date is 52 years
165,990,650 1,618,490,000 1,452,499,350
20 Katha land located at Kalatoli, Cox’s Bazar
Free hold land, subsequently the land was sold on 20/09/2012
15,339,500 17,950,400 2,610,900
Total 181,330,150 1,636,440,000 1,455,110,250
AUDITOR’S ADDITIONAL DISCLOSURE ON REVALUATION OF LAND AND DEVELOPMENT MOHAMMED
ELIAS BROTHERS POY MANUFACTURING PLANT LIMITED
Based on our verification of the valuation report as produced to us by the management of Mohammed Elias Brothers POY Manufacturing Plant Limited and as per company explanation, this is to certify that revaluation of Land and Development of Mohammed Elias Brothers POY Manufacturing Plant Limited as at December 12, 2011 carried out by independent valuer Rahman Mostafa Alam & Co. Chartered Accountants have been made and report has been prepared in accordance with Bangladesh Accounting Standards (BAS) and Bangladesh Financial Reporting Standards (BFRS) and other applicable laws , rules , regulations and guidelines. We also certify that proper accounting treatments, including provisions, tax and other liabilities have been made, revaluation reserve has been created in the financial statements to consider the valuation as per applicable rules and standards.
Sd/- Ahmed Zaker & Co. Place: Chittagong
Chartered Accountants Dated: 10 Dec 2017
(o) Where the issuer is a holding or subsidiary company, full disclosure about the transactions, including its nature and amount, between the issuer and its subsidiary or holding company, including transactions which had taken place within the last five years of the issuance of the prospectus or since the date of incorporation of the issuer, whichever is later, clearly indicating whether the issuer is a debtor or a creditor;
The Company has no holding or subsidiary Company during last five years.
(p) Financial Information of Group Companies and Companies under common ownership by more than 50%: following information for the last three years based on the audited financial statements, in respect of all the group companies of the issuer, wherever applicable, along with significant notes of auditors:
The Company has no subsidiary nor is it operated under a holding company. Hence, the information is not applicable for the company.
(q) Where the issuer is a banking company, insurance company, non-banking financial institution or any other company which is regulated and licensed by another primary regulator, a declaration by the board of directors shall be included in the prospectus stating that all requirements of the relevant laws and regulatory requirements of its primary regulator have been adhered to by the issuer;
Not applicable
(r) A report from the auditors regarding any allotment of shares to any person for any consideration otherwise than cash along with relationship of that person with the issuer and rationale of issue price of the shares;
Auditor’s certificate regarding the amount shown against paid up capital of
Mohammed Elias Brothers POY Manufacturing Plant Limited Based on our examination of share Register and its underlying documents, the paid-up capital of Mohammed Elias Brothers POY Manufacturing Plant Limited as on September 30, 2017 appears at Tk. 1,680,000,000 consisting of 168,000,000 no. of Ordinary Shares of Tk. 10 each as follows:
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Authorized Capital 300,000,000 shares @ Tk. 10 each 3,000,000,000
Issued, Subscribed and Paid up Capital of 168,000,000 Ordinary Shares @ Tk. 10 each in full in cash and other than cash
Allotments for cash consideration
At the time of incorporation as on August 01, 2002 500,000
Issued as on April 14, 2005 20,000,000
Issued as on March 22, 2010 9,500,000
Issued as on March 29, 2010 70,000,000
Issued as on November 24, 2011 89,000,000
Issued as on November 27, 2011 36,500,000
Issued as on January 02, 2012 474,500,000
Sub Total (A) 700,000,000
Allotments other than cash
Bonus Share Issue on November 20, 2011 800,000,000
Bonus Share Issue on December 22, 2013 180,000,000
Sub Total (B) 980,000,000
Grand Total C=(A+B) 1,680,000,000
The above-mentioned Allotments for Cash Consideration was deposited to the Trust Bank Ltd., Agrabad Branch, Chittagong and IFIC Bank Ltd., Pragoti Sharani Branch, Dhaka.
The Company has subdivided the face value of its ordinary share from BDT 100.00 to BDT 10.00 by passing a special resolution in its Extraordinary General Meeting held on 21th October, 2010. Thus, paid-up capital of the Company comes to BDT 1,680,000,000/- (Taka One hundred sixty-eight crores only) divided into 168,000,000/- nos. ordinary shares of BDT 10.00 each.
Sd/- Ahmed Zaker & Co. Place: Chittagong Chartered Accountants Dated: 10 Dec-2017
(s) Any material information, which is likely to have an impact on the offering or change the terms and conditions under which the offer has been made to the public;
There is no material information which is likely to have an impact on the offering or change the terms and conditions under which the offer has been made to the public.
(t) Business strategies and future plans - projected financial statements shall be required only for companies not started commercial operation yet and authenticated by Chairman, two Directors, Managing Director, CFO, and Company Secretary;
Business strategies
The Company’s business strategies are as follows: ◊ To improve and consolidate its position in the industry ◊ To focus on continuous growth philosophy ◊ To maintain good liaison with stakeholders ◊ To focus on future export market ◊ To drive with the strategic levers of operational excellence, strengthening existing services, customer satisfaction,
ecosystem development, innovation, adopt new technologies and marketing.
Future plan
The Company has vast experience in this business. Currently the Company producing Partially Oriented Yarn (POY) and
Draw Textured Yarn (DTY) of international standard. In order to meetup the growing trend of increased consumption of Fully
Draw Yarn (FDY), the company is expecting to establish a FDY Project as described in the Section-xxii as titled of “Use of
Proceeds” of this Prospectus.
(u) Discussion on the results of operations shall inter-alia contain the following;
(1) A summary of the past financial results after adjustments as given in the auditor’s report containing significant items of income and expenditure:
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There was no significant adjustment given in the auditors’ report during the last financial year. Summary of the financial results and operations are presented below:
As per audited financial statements (Amount in Taka)
(2) A summary of major items of income and expenditure
Major items of income
As per Audited Financial Statements (Amount in taka) Sl.
Particulars 30-Sep-17 (3 months)
30-Jun-17 30-June-16 (6 months)
31-Dec-15 31-Dec-14 31-Dec-13 31-Dec-12
1 Revenue 288,794,411 698,250,890 134,856,507 1,102,563,159 699,462,644 1,182,834,175 1,329,670,924
2 Non-operating
income 653,394 1,315,035 390,711 3,022,699 3,818,601 41,548,051 8,481,951
Major items of expenditure
As per Audited Financial Statements (Amount in taka)
Sl. Particulars 30-Sep-17 (3 months)
30-Jun-17 30-June-16 (6 months)
31-Dec-15 31-Dec-14 31-Dec-13 31-Dec-12
1 Operating expenses 14,273,418 46,586,168 18,423,687 39,227,294 30,052,481 82,537,982 79,064,830
2 Financial expenses 27,399,324 80,095,166 28,695,008 75,682,791 27,250,019 48,964,960 58,553,637
(3) The income and sales on account of major products or services;
The income and sales on account of major products are as follows: As per audited financial statements (Amount in taka)
Sl. Product name 30-Sep-17 (3 months)
30-Jun-17 30-June-16 (6 months)
31-Dec-15 31-Dec-14 31-Dec-13 31-Dec-12
Qty. (Kg) Qty. (Kg) Qty. (Kg) Qty. (Kg) Qty. (Kg) Qty. (Kg) Qty. (Kg)
1 DTY 1,501,000 3,198,653 859,573 5,087,0544 3,002,835 6,169,059 6,733,138
(4) In case, other income constitutes more than 10% of the total income, the breakup of the same along with the nature of the income, i.e., recurring or non-recurring;
Other income of the company is not more than 10% of the total income.
(5) If a material part of the income is dependent upon a single customer or a few major customers, disclosure of this fact along with relevant data. Similarly, if any foreign customer constitutes a significant portion of the issuer’s business, disclosure of the fact along with its impact on the business considering exchange rate fluctuations;
The major customers of the Company along with relevant data is as follows: (Taka in million) Sales made during last 5 years
Name of customer 01.07.17-30.09.17
% of total sales
01.07.16-30.06.17
% of total sales
01.01.16- 30.06.16
% of total sales
2015 % of total sales
2014 % of total sales
2013 % of total sales
2012 % of total sales
M/S Monjur Hossain 16.13 5.56 38.99 5.56 7.44 5.48 61.51 5.56 38.90 5.56 63.40 5.56 123.40 9.34
Arif Traders 18.02 6.21 44.65 6.36 8.58 6.32 51.44 4.65 37.95 5.42 62.41 5.47 145.49 11.01
Yusuf Yarn Trading 19.32 6.65 37.05 5.28 7.88 5.80 72.05 6.51 39.69 5.67 60.87 5.33 154.43 11.69
Saiful Yarn Trading 14.86 5.12 41.97 5.98 8.18 6.03 61.03 5.51 39.59 5.65 68.16 5.97 162.14 12.27
Jasim & Brothers 15.24 5.25 43.69 6.23 7.53 5.54 51.53 4.65 39.27 5.61 63.59 5.57 103.51 7.83
S.K. Traders 16.03 5.52 38.46 5.48 7.46 5.50 71.99 6.5 38.73 5.53 60.05 5.26 112.41 8.51
Das Traders 14.35 4.94 28.93 4.12 8.85 6.52 61.88 5.59 38.19 5.46 61.85 5.42 113.97 8.63
(6) In case the issuer has followed any unorthodox procedure for recording sales and revenues, its impact shall be analyzed and disclosed.
Any unorthodox procedure was not followed by the Company for recording its sales and revenue.
Revenue 288,794,411 698,250,890 134,856,507 1,102,563,159 699,462,644 1,182,834,175 1,329,670,924
Year to year changes in revenue (%) (58.64) 417.77 (87.77) 57.63 (40.87) (11.04) (8.90)
Cost of goods sold (COGS) 175,702,069 453,684,333 47,101,289 869,015,159 480,818,559 871,076,427 1,088,825,788
Year to year changes in COGS (%) (61.27) 863.21 (94.58) 80.74 (44.80) (20.00) (11.42)
Gross profit (GP) 112,438,948 243,251,522 87,364,506 230,525,301 214,825,484 270,209,697 232,363,185
Year to year changes in Gross Profit (%) (53.78) 178.43 (62.10) 7.31 (20.50) 16.29 2.72
Operating expenses 14,273,418 46,586,168 18,423,687 39,227,294 30,052,481 82,537,982 79,064,830
Year to year changes in Operating expenses (%) (69.36) 152.86 (53.03) 30.53 (63.59) 4.39 (2.45)
Financial expenses 27,399,324 80,095,166 28,695,008 75,682,791 27,250,019 48,964,960 58,553,637
Year to year changes in Financial expenses (%) (65.79) 179.13 (62.09) 177.73 (44.35) (16.38) (11.64)
Net profit after tax 57,258,574 111,757,912 32,896,232 96,026,537 130,554,800 141,942,322 78,332,304
Year to year changes in Net Profit after tax (%) (48.77) 239.73 (65.74) (26.45) (8.02) 81.21 16.61
Particulars 30-June-16 31-Dec-15 31-Dec-14 31-Dec-13 31-Dec-1230-Jun-1730-Sep-17
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(v) Comparison of recent financial year with the previous financial years on the major heads of the profit and loss statement, including an analysis of reasons for the changes in significant items of income and expenditure, inter-alia, containing the following:
Amount in Taka
Causes for changes in year to year changes in revenue (%)
Revenue has been changed over the period due to changes in business volume.
Causes for changes of year to year of COGS
COGS changes over the period due to changes in price of raw materials fuel & wages.
Causes for changes of year to year of other Operating Expenses
Operating expenses changes due to changes in administrative and selling expense.
Causes for changes of year to year of Net Income
Net profit after tax changes due to changes in revenue and operating expenses (administrative and selling expense) reduce, raw material price changes and financial expenses and tax expenses changes.
(1) Unusual or infrequent events or transactions including unusual trends on account of business activity, unusual items of income, change of accounting policies and discretionary reduction of expenses etc.
There were no unusual or infrequent transactions or events in the past.
(2) Significant economic changes that materially affect or are likely to affect income from continuing operations;
There were no significant economic changes that materially affected or are likely to affect income from continuing operations.
(3) Known trends or uncertainties that have had or are expected to have a material adverse impact on sales, revenue or income from continuing operations;
Other than matters as described in the “Risk Factors” and “Plan of operation and discussion of Financial Conditions ‘of this prospectus, there are no known trends or uncertainties that have had or are expected to have a material adverse impact on revenues or income of the Company from continuing operations.
(4) Future changes in relationship between costs and revenues, in case of events such as future increase in labor or material costs or prices that will cause a material change are known;
Cost of production is increased when cost of the material and labor increase and accordingly increase in sales price is a common phenomenon in the business.
However, any change in material cost is adjusted with sale price where labor cost is adjusted in the sale price. Other than the factors described above, The Company has been trying to adjust the cost of labor through increasing the production efficiency.
The Company believes that it has the ability to tradeoff the changes in costs with the future revenues.
(5) The extent to which material increases in net sales or revenue are due to increased sales volume, introduction of new products or services or increased sales prices;
Increases in revenues were linked to increases in volume of business activities carried out as a normal course of business
during last five years.
(6) Total turnover of each major industry segment in which the issuer operated
To the best of our knowledge there is no publicly available independent source of market information regarding total turnover of the sector.
Revenue 288,794,411 698,250,890 134,856,507 1,102,563,159 699,462,644 1,182,834,175 1,329,670,924
Year to year changes in revenue (%) (58.64) 417.77 (87.77) 57.63 (40.87) (11.04) (8.90)
Cost of goods sold (COGS) 175,702,069 453,684,333 47,101,289 869,015,159 480,818,559 871,076,427 1,088,825,788
Year to year changes in COGS (%) (61.27) 863.21 (94.58) 80.74 (44.80) (20.00) (11.42)
Gross profit (GP) 112,438,948 243,251,522 87,364,506 230,525,301 214,825,484 270,209,697 232,363,185
Year to year changes in Gross Profit (%) (53.78) 178.43 (62.10) 7.31 (20.50) 16.29 2.72
Operating expenses 14,273,418 46,586,168 18,423,687 39,227,294 30,052,481 82,537,982 79,064,830
Year to year changes in Operating expenses (%) (69.36) 152.86 (53.03) 30.53 (63.59) 4.39 (2.45)
Financial expenses 27,399,324 80,095,166 28,695,008 75,682,791 27,250,019 48,964,960 58,553,637
Year to year changes in Financial expenses (%) (65.79) 179.13 (62.09) 177.73 (44.35) (16.38) (11.64)
Net profit after tax 57,258,574 111,757,912 32,896,232 96,026,537 130,554,800 141,942,322 78,332,304
Year to year changes in Net Profit after tax (%) (48.77) 239.73 (65.74) (26.45) (8.02) 81.21 16.61
Particulars 30-June-16 31-Dec-15 31-Dec-14 31-Dec-13 31-Dec-1230-Jun-1730-Sep-17
79
(7) Status of any publicly announced new products or business segment;
There are no publicly announced new products or business segment of the Company.
8) The extent to which the business is seasonal.
The business of the Company is not dependent on any seasonal aspects.
(w) Defaults or rescheduling of borrowings with financial institutions or banks, conversion of loans into equity along with reasons thereof, lock out, strikes and reasons for the same etc. during the history of operation of the company;
The Company has rescheduled of its borrowing with Trust Bank Limited, Dhaka Bank Limited, IIDFC, Premier leasing company ltd and Phoenix Finance & Investment Ltd. There is no history of conversion of loan into equity, lock out and strikes.
(x) Details regarding the changes in the activities of the issuer during the last five years which may had a material effect on the profits or loss, including discontinuance of lines of business, loss of agencies or markets and similar factors;
There is no change in the activities of MEBPOY during the last five years which may had a material effect on the profits or loss, including discontinuance of lines of business, loss of agencies or markets and similar factors.
(y) Injunction or restraining order, if any, with possible implications;
There is no injunction or restraining order.
(z) Technology, market, managerial competence and capacity built-up;
Technology
The factories of Mohammed Elias Brothers POY Manufacturing Plant Limited is well equipped with modern machineries sourced from Japan, Germany, India & USA. Apart from these, the TALLY system of the Company allows the corporate office to smooth financial operation.
Market
With the growing trend of increased consumption of Fully Draw Yarn (FDY), the internal requirement of product is rapidly increasing. Only 20% of the need can be met by the local production and the balance 80% has to be imported. The gap between the import cost and the manufacturing cost is too big and the feasibility of a new unit in Bangladesh is too high. At the same time, the demand of FDY is increasing at the rate of 12% per annum. Since the local demand of Draw Textured Yarn (DTY) is much higher than the local production, a huge amount of DTY is required to be imported from various countries. Currently there are six companies producing DTY. The use of DTY and the related industry is at present undergoing rapid structural changes, triggered in part by the withdrawal of import restrictions and the imminent easing of the import duty structure. The increasing expansion of garments factory, increasing demand of fishing net, mosquito net, weaving & knitting of fabrics for making clothes, home furnishings, seat covers, bags and many other uses in the country has boost up the need of more and more DTY, especially FDY which opened a new dimension in this sector.
Managerial competence
The existing management is competent enough to run the business operation. The management team has proven track record to run large organization and vast experience to minimize the operational risk. The management also appointed such personnel who are capable enough to operate the plant effectively and efficiently. Even though any experienced personnel leave the organization, others have adequate expertise and skills to run the operation
Capacity built-up
To keep space with the contemporary technology and customer demand the company continuously investing and deploying enough resources including human resources.
(aa) Changes in accounting policies in the last three years;
There were no changes in accounting policies in the last three years except depreciation rate revised and deferred tax implemented during the last three years.
(bb) Significant developments subsequent to the last financial year: A statement by the directors whether in their opinion there have arisen any circumstances since the date of the last financial statements as disclosed in the prospectus or prospectus or information memorandum and which materially and adversely affect or is likely to affect the trading or profitability of the issuer, or the value of its assets, or its ability to pay its liabilities within the next twelve months;
80
Declaration regarding significant developments subsequent to the last financial year
This is to certify that in our opinion there have not arisen any circumstances since the date of the last financial statements as disclosed in the prospectus and which materially and adversely affect or is likely to affect the trading or the profitability of the Mohammed Elias Brothers POY Manufacturing Plant Limited, or the value of its assets, or its ability to pay its liabilities within the next twelve months.
Sd/- Sd/- Sd/- Sd/- Md. Mozaffor Ahmed
Company Secretary
Md. Shahidullah Khan
Chief Financial Officer
Mohd. Rezaul Karim
Director & Managing Director
Sydul Karim
Chairman (cc) If any quarter of the financial year of the issuer ends after the period ended in the audited financial statements as disclosed in the prospectus or information memorandum, unaudited financial statements for each of the said quarters duly authenticated by the CEO and CFO of the issuer or information memorandum, unaudited financial statements for each of the said quarters duly authenticated by the CEO and CFO of the issuer;
The quarterly unaudited financial statements duly authenticated by the CEO and CFO of the issuer for the upcoming periods of the Company will be submitted as per requirement of the authority.
(dd) Factors that may affect the results of operations.
There are no factors that may affect the results of operations except followings: 1. Changes in relevant Govt. policies 2. Technological obsolescence
3. Political unrest
4. Natural calamities
5. Demand for readymade garments decreases globally
81
CHAPTER – VII MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
82
(a) Overview of business and strategies;
Background
1994 vide Reg. No. C-4410 of 2002 with an authorized capital of Tk. 3,000,000,000 divided into 300,000,000 ordinary shares of Tk. 10 each. The initial product of the Company was only POY till Dec 2009. The forward linkage of POY (Partially oriented Yarn) is DTY (Draw Textured Yarn). The DTY unit was procured on 31 Dec 2009 and merged with the Company. Since then the company is marketing DTY. From 2010 POY is the raw materials for DTY and 100% captive consumption. The project of the Company is equipped with brand new modern machinery imported from Germany, Japan, USA, India and Turkey with a view to produce Partially Oriented Yarn (POY) and Draw Textured Yarn (DTY) of international standard. The Company started its commercial operation with a license capacity per annum 10,500,000 kg, installed capacity per annum 9,800,000 kg for POY and DTY. The Company currently employs 263 people as on September 30, 2017. The Company is the active member of Bangladesh Textile Mills Association (BTMA).
Nature of Business
The initial product of the Company was only POY till Dec 2009. The forward linkage of POY (Partially oriented Yarn) is DTY (Draw Textured Yarn). The DTY unit was procured on 31 Dec 2009 and merged with the Company. Since then the company is marketing DTY. From 2010 POY is the raw materials for DTY and 100% captive consumption.
Business strategies
The Company’s business strategies are as follows: ◊ To improve and consolidate its position in the industry ◊ To focus on continuous growth philosophy ◊ To maintain good liaison with stakeholders ◊ To focus on future export market ◊ To drive with the strategic levers of operational excellence, strengthening existing services, customer satisfaction,
ecosystem development, innovation, adopt new technologies and marketing.
(b) SWOT ANALYSIS;
Strength
◊ Experienced sponsor ◊ Skilled human resources ◊ Modern Brand new machinery ◊ Concentrated on special production ◊ Quality production ◊ Affordable Cost ◊ Strong brand image and reputation
Weakness
◊ Limited market ◊ Fluctuations of International Raw Materials Market
Opportunities
◊ Scope of diversification to set up new plant ◊ Expansion of business operations ◊ To set up new machine to explore production ◊ Less Competitors ◊ Opportunity for increasing profitability ◊ High Demand of product
Threat
◊ Frequently Changes of modern technology ◊ Increase of costing of maintenance of plant & machinery ◊ Migration of skilled manpower
Increase of costing of power.
83
(c) Analysis of the financial statements of last five years with reason(s) of fluctuating revenue or sales, other income, total income, cost of material, finance cost, depreciation and amortization expense, other expense; changes of inventories, net profit before & after tax, EPS etc.
Amount in Taka Particulars 30-Sep-17 30-Jun-17 30-June-16 31-Dec-15 31-Dec-14 31-Dec-13 31-Dec-12
Revenue 288,141,017 696,935,855 134,465,796 1,099,540,460 695,644,043 1,141,286,124 1,321,188,973
Year to year changes in revenue (%) (58.66) 418.30 (87.77) 58.06 (39.05) (13.62) (9.22)
Other Income 653,394 1,315,035 390,711 3,022,699 3,818,601 41,548,051 8,481,951
Year to year changes in other income(%) (50.31) 236.58 (87.07) (20.84) (90.81) 389.84 107.32
Total Income 288,794,411 698,250,890 134,856,507 1,102,563,159 699,462,644 1,182,834,175 1,329,670,924
Year to year changes in Total income(%) (58.64) 417.77 (87.77) 57.63 (40.87) (11.04) (8.90)
Cost of material 144,609,998 310,800,046 85,525,438 630,331,152 353,662,653 921,913,616 919,503,599
Year to year changes in Cost of Material -53.47 263.40 -86.43 78.23 -43.13 -32.36 -5.50
Finance Cost 27,399,324 80,095,166 28,695,008 75,682,791 27,250,019 48,964,960 58,553,637
Year to year changes in cost of material (%) (65.79) 179.13 (62.09) 177.73 (44.35) (16.38) (11.64)
Depreciation 20,765,104 91,300,745 49,190,664 107,388,133 98,636,081 110,724,996 106,692,171
Year to year changes in depreciation (%) (77.26) 85.61 (54.19) 8.87 (10.92) 3.64 13.51
Amortization - - - - - - -
Year to year changes in Amortization (%) - - - - - - -
Other expenses 14,273,418 46,586,168 18,423,687 39,227,294 30,052,481 82,537,982 79,064,830
Year to year changes in Other expenses (%) (69.36) 152.86 (53.03) 30.53 (63.59) 4.39 (2.45)
Inventories 987,733,590 985,922,017 945,793,874 821,359,670 804,369,935 641,356,324 406,529,930
Year to year changes in inventories (%) 0.18 4.24 15.15 2.11 25.42 57.76 15.80
Net Profit before tax 68,018,667 112,271,641 38,701,449 112,988,491 153,658,652 171,671,244 98,311,114
Year to year changes in Net Profit before tax (%) (39.42) 190.10 (65.75) (26.47) (10.49) 74.62 24.40
Net Profit after tax 57,258,574 111,757,912 32,896,232 96,026,537 130,554,800 141,942,322 78,332,304
Year to year changes in Net Profit after tax (%) (48.77) 239.73 (65.74) (26.45) (8.02) 81.21 16.61
EPS 0.34 0.67 0.20 0.57 0.78 0.84 0.52
Year to year changes in EPS (%) (48.89) 239.73 (65.74) (26.45) (8.02) 61.79 (23.12)
Causes for changes of revenue year to year
Revenue was changed over the period due to changes in business volume.
Causes for Changes in other income year to year
Other income changes due to changes in interest rate.
Causes for changes in Changes in total income year to year
Total income changes due changes in revenue and expenses.
Causes for Changes in Cost of material
Cost of material changes due to raw material rate changes in Local and international market.
Causes for Changes in Finance cost
Finance cost changes due to interest rate change year to year.
Causes for Changes in depreciation and amortization expense
Depreciation has been changed over the period due to asset new addition and economic life increase.
Causes for Changes in other expense
Not applicable
Causes for Changes in Inventories
Due to market demand, inventories are storied; Inventory change is the difference between the inventory totals for the last reporting period and the current reporting period.
Causes for Changes in Net profit before tax
Due to changes in raw material price, selling expense change, and financial expenses.
Causes for Changes in Net profit after tax
Net profit changes due to changes in revenue and Operating expenses (administrative and selling expense) reduce, raw material price changes and financial expenses and tax expenses changes.
Causes for Changes in EPS
Due to changes in number of share year to year and cumulative fluctuations of income statements item.
(d) Known trends demands, commitments, events or uncertainties that are likely to have an effect on the company’s business;
There are no known trends demands, commitments, events or uncertainties that are likely to have an effect on the Company’s
business except the followings:
1. Changes in relevant Govt. policies
84
2. Technological obsolescence
3. Political unrest
4. Natural calamities
(e) Trends or expected fluctuations in liquidity;
There are no trends or expected fluctuations in liquidity except impact of the future expansion program as described section-xxii under the head “Use of proceeds”. The expansion project shall be finance through raising of fund from IPO and internal cash generation. So the future expansion project shall not hamper the normal business operation of the Company as well as liquidity position to meet up financial obligation to make the expected payment within due date.
(f) Off-balance sheet arrangements those have or likely to have a current or future effect on financial condition.
There are no off-balance sheet arrangements those have or likely to have a current or future effect on financial condition of the
company except the contingent liabilities as disclosed in the note no. 32 of the notes to the financial statements of the audited
financial statements for the period ended September 30, 2017.
85
CHAPTER –VIII DIRECTORS AND OFFICERS
86
(a) Name, Father’s name, age, residential address, educational qualification, experience and position of each of the directors of the company and any person nominated or represented to be a director, showing the period for which the nomination has been made and the name of the organization which has nominated him;
Sl. Name of Director Father’s Name Age Residential address Educational qualification
Experience Position Period of
nomination
Name of nominated
organization
1 Mr. Sydul Karim
Late Haje Ahmed Hossian
41 2292/A, MEB House, East Sholosahar, Chawkbazar-4203, Chandgaon, Chittagong
B.Com 10 years Chairman N/A N/A
2 Mr. Mohd. Rezaul Karim
Late Haje Ahmed Hossain
45 2292/A, MEB House, East Sholosahar, Chawkbazar-4203, Chandgaon, Chittagong
M.A (History)
12 years Director & Managing Director
N/A N/A
3 Mr. Mohd. Abrar Hossain
Mr Mohd. Nurul Alam
27 2292/A, MEB House, East Sholosahar, Chawkbazar-4203, Chandgaon, Chittagong
BBA 3 years Director N/A N/A
4 Mr. Mohd. Asfak Hossain
Mr. Mohd. Nurul Absar
34 2292/A, MEB House, East Sholosahar, Chawkbazar-4203, Chandgaon, Chittagong
BBA 3 years Director N/A N/A
5 Mr. Mohd. Asrar Hossain
Mr. Mohd. Nurul Alam
23 2292/A, MEB House, East Sholosahar, Chawkbazar-4203, Chandgaon, Chittagong
BSE 3 years Director N/A N/A
6 Mr. Mohd. Eradat Ullah, FCA
A T M Shafi Ullah 52 151 SK Mujib road Agrabad C/A, Chittagong
FCA 25 years Independent
Director N/A N/A
7 Mr. Md. Golam Moin Uddin Chowdhury
Fakir Ahmed Chowdhury
74 AIM Development Nilgiri, 100/122, Abdul Latif Road, Panchlaish, Chittagong
Graduate 45 years Independent
Director N/A N/A
(b) The date on which he first became a director and the date on which his current term of office shall expire
Sl. Name of Director First date of appointment as Director Date of expiry of current term
1 Mr. Sydul Karim 15 September 2011 Next AGM
2 Mr. Mohd. Rezaul Karim 1 August, 2002 Next AGM
3 Mr. Mohd. Abrar Hossain 21 November 2012 Next AGM
4 Mr. Mohd. Asfak Hossain 20 December 2012 Next AGM
5 Mr. Mohd. Asrar Hossain 20 December 2012 Next AGM
6 Mr. Mohd. Eradat Ullah, FCA 08 October 2017 Next AGM
7 Mr. Md. Golam Moin Uddin Chowdhury
03 December 2017 Next AGM
(c) If any director has any type of interest in other businesses, names and types of business of such organizations. If any director is also a director of another company or owner or partner of any other concern, the names of such organizations;
(d) Statement of if any of the directors of the issuer are associated with the securities market in any manner. If any director of the Issuer Company is also a director of any issuer of other listed securities during last three years then dividend payment history and market performance of that issuer;
There is no involvement of any directors of the company with the securities market in any manner.
And no director is a director of any issuer of other listed securities during last three years.
(e) Any family relationship (father, mother, spouse, brother, sister, son, daughter, spouse’s father, spouse’s mother, spouse’s brother, spouse’s sister) among the directors and top five officers;
Family relationship among the directors
Sl. Name of Directors Position in the Company Relationship with other Director
1. Mr. Sydul Karim Chairman
Brother of Mohd. Rezaul Karim, Director & Managing Director
Uncle of Mohd. Abrar Hossain, Director
Uncle of Mohd. Asfak Hossain, Director
Uncle of Mohd. Asrar Hossain, Director
2. Mr. Mohd. Rezaul Karim Director & Managing
Director
Brother of Sydul Karim, Chairman
Uncle of Mohd. Abrar Hossain, Director
Uncle of Mohd. Asfak Hossain, Director
Uncle of Mohd. Asrar Hossain, Director
3. Mr. Mohd. Abrar Hossain Director Brother of Mohd. Asrar Hossain, Director
Cousin of Mohd. Asfak Hossain, Director
SL Name of Director Other ventures of each Director and present position
Name of the Company Position
1 Sydul Karim Dharithree Land Management Ltd. Managing director
MNA Consumer Products Limited Managing director
87
Nephew of Mohd. Rezaul Karim, Director & Managing Director,
Nephew of Sydul Karim, Chairman
4. Mr. Mohd. Asfak Hossain Director
Cousin of Mohd. Abrar Hossain, Director
Cousin of Mohd. Asrar Hossain, Director
Nephew of Mohd. Rezaul Karim, Director & Managing Director,
Nephew of Sydul Karim, Chairman
5. Mr. Mohd. Asrar Hossain Director
Brother of Mohd. Abrar Hossain, Director
Cousin of Mohd. Asfak Hossain, Director
Nephew of Mohd. Rezaul Karim, Director & Managing Director,
Nephew of Sydul Karim, Chairman
Family relationship among top five officers
There is no family relationship among top five officers
(f) A very brief description of other businesses of the directors;
The Directors of the Company is not involved with any other business.
(g) Short bio-data of each director;
Mr. Sydul Karim-Chairman
Mr. Sydul Karim, Son of Late Hajee Ahmed Hossain was born in 6th February, 1976. The Director of company graduated from a reputed university. He is involved in admin & personnel management of the company. Mr. Karim is involved in various charitable institutions and is a highly regarded personality in the society.
Mohd. Rezaul Karim- Director & Managing Director
Mohd. Rezaul Karim, Son of Late Hajee Ahmed Hossain was born in 1st December, 1971. The managing Director of the company graduated from Chittagong University. After completion of his education he has engaged with the industry and by dint of his excellent performance and experience he became the key person of the company. He has gained wide experience and knowledge in modern technology, production, and marketing & management techniques of textile industry. He is also associated with many social welfare organizations.
Mr. Mohd. Abrar Hossain- Director
Mr. Mohd. Abrar Hossain, Son of Mohd. Nurul Alam was born in 29th July, 1990. He graduated from a reputed university. He is directly involved in commercial department of the company. Mr. Hossain is involved in various social activities of the country.
Mr. Mohd. Asfak Hossain- Director
Mr. Mohd. Asfak Hossain, Son of Mohd. Nurul Absar was born in 24th February, 1983. He is directly involved in production department of the company. He graduated from a reputed university from Chittagong. He associated with many social welfare organizations.
Mr. Mohd. Asrar Hossain-Director
Mr. Mohd. Asrar Hossain, Son of Mohd. Nurul Alam was born in 6th August, 1994. He completed A level from a reputed institution and also graduated from North South University. He associated with many social welfare organizations.
Mr. Mohd. Eradat Ullah, FCA
Mr. Mohd. Eradat Ullah son of Late ATM Shafi Ullah has appointed as Independent Director of the Company on 8th October 2017. The Independent director of the company completed his B. Com (Hons) & M. Com graduation from Chittagong University and secured by 1st class (3rd position) in both the examination. He became member of ICAB in 1995 after qualifying November – December 1994 term and FCA in 2000. Mr. Eradat Ullah also proprietor of S. Ahmed & Co. Chartered Accountant & public Practicing since 1997.
Md. Golam Moin Uddin Chowdhury
Md. Golam Moinuddin Chowdhury son of Late Fakir Ahmed Chowdhury has completed his graduation from Rajshahi University in 1964. The Independent Director of the company has gained wide range of experience & knowledge in banking, Shipping & many deferent kind of business since 1961. Mr. Golam Moinuddin Chowdhury has appointed as Independent director on 3rd December 2017. He is associated with many social welfare organizations.
(h) Loan status of the issuer, its directors and shareholders who hold 10% or more shares in the paid-up capital of the issuer in terms of the CIB Report of Bangladesh Bank;
Neither the Company nor any of its directors or shareholders who hold 10% or more shares in the paid- up capital of the Company is loan defaulter in terms of the CIB report of the Bangladesh Bank.
88
(i) Name with position, educational qualification, age, date of joining in the company, overall experience (in year), previous employment, salary paid for the financial year of the Chief Executive Officer, Managing Director, Chief Financial Officer, Company Secretary, Advisers, Consultants and all Departmental Heads. If the Chairman, any director or any shareholder received any monthly salary than this information should also be included;
Sl. Name of top five salaried officer Position Basis of Amount
Salaries Paid (Amount in Taka) 01.07.17 -30.09.17 Year ended 30 June 2017
1 Mr. Mohd. Shahidullah Khan CFO 121129.00 363387.00 1453548.00
2 Mr. Mohammed Mozaffor Ahmed Company Secretary 32594.90 97784.70 391138.80
3 Mr. Ashraf Hossain DGM (Factory) 49522.50 148567.50 594270.00
4. Md. Habibur Rahman DGM (Finance) 66000.00 198000.00 792000.00
5 Mr. Shahidul Islam Manager (Production) 81119.00 243357.00 973428.00
6 Mohd. M A Kabir Manager (Utility) 38324.70 114974.10 459896.40
7 Md. Nurul Momen Manager (Accounts) 37194.80 111584.40 446337.60
8 Md. Ataullah Chy. Manager (Personnel) 38432.20 115296.60 461186.40
Note: Mohd. Rezaul karim, Managing Director of the Company is not taking any remuneration/salary.
Monthly Salary Statement of Chairman, Director and Other Shareholder
The Chairman, Director and other shareholder of the company is not getting any salary. The Board of Directors only receive board meeting attendance fees.
(j) Changes in the key management persons during the last three years. Any change otherwise than by way of retirement in the normal course in the senior key management personnel particularly in charge of production, planning, finance and marketing during the last three years prior to the date of filing the information memorandum. If the turnover of key management personnel is high compared to the industry, reasons should be discussed;
There are no changes in the key management persons during the last three years. The turnover of key management personnel is very low compared to the industry.
(k) A profile of the sponsors including their names, father’s names, age, personal addresses, educational qualifications, and experiences in the business, positions or posts held in the past, directorship held, other ventures of each sponsor and present position;
Sl Name of the
sponsor Father’s names Age Personal addresses
Educational qualifications
Experiences in the
business
Positions/ posts held in the
past Directorship held
Other ventures of each sponsor and present position
Name of the Company
Position*
1
Late
Hajee
Ahmed
Hossain
Late Hajee Fasiul Hoque Sowdagar
60
2292/A, MEB House, East Sholosahar, Chawkbaza r-4203, Chandgaon, Chittagong.
Graduate 45
years
Late Hajee Ahmed Hossain was the subscriber to the
Memorandum. After his death the entire share were
transmitted to the following persons:
1. Mr. Mohd. Nurul Absar
2. Mr. Mohd. Nurul Alam
3. Mr. Jan-E- Alam
4. Mr. Zakaria Alam
5. Mr. Mohd. Aminul Karim
6. Mr. Mohd. Rezaul Karim
7. Mrs. Sanowara Begum
8. Mrs. Sakina Begum
9. Mrs. Hosnara Begum
10. Mrs. Amena Begum
2
Md.
Nurul
Absar
Late Hajee Ahmed Hossain
62
2292/A, MEB House, East Sholosahar,Chawkbazar-4203, Chandgaon, Chittagong
Graduate 39
years Chairman
Date of incorporation
- -
3
Md.
Shamsul
Alam
Late Mohammed Elias
61
2292/A, MEB
House, East Sholosahar,Chawkbazar-4203, Chandgaon, Chittagong
Graduate 34
years
Managing
Director Date of
incorporation - -
4
Md.
Nurul
Alam
Late Hajee Ahmed Hossain
53
2292/A, MEB House, East Sholosahar,Chawkbazar-4203, Chandgaon, Chittagong
Graduate 28
years Director
Date of incorporation
- -
5
Md.
Khurshe
d Alam
Late Mohammed Elias
47
2292/A, MEB House, East Sholosahar,Chawkbazar-4203, Chandgaon, Chittagong
Graduate 21
years Director
Date of incorporation
- -
89
6
Md.
Rezaul
Karim
Late Ahmed Hossain
46
2292/A, MEB House, East Sholosahar,Chaw
kbazar-4203, Chandgaon, Chittagong
Graduate 19
years Director
Date of incorporation
- -
7
Md.
Morshed
ul Alam
Late Mohamed Elias
45
2292/A, MEB House, East Sholosahar,Chawkbazar-4203, Chandgaon, Chittagong
Graduate 17
years Director
Date of incorporation
- -
8
Md.
Aminul
Karim
Late Ahmed Hossain
43
2292/A, MEB House, East Sholosahar,Chawkbazar-4203, Chandgaon, Chittagong
Graduate 15
years Director
Date of incorporation
- -
(l) If the present directors are not the sponsors and control of the issuer was acquired within five years immediately preceding the date of filing prospectus details regarding the acquisition of control, date of acquisition, terms of acquisition, consideration paid for such acquisition etc.
Sl.
position Name with of Director
Details of acquisition
Date of acquisition
Terms of acquisition Consideration paid for such
acquisition (Tk.)
1 Mr. Sydul Karim,
Chairman
56 30-09-2003 Transferred from Late Mr. Hajee Ahmed Hossain 5,600
16 2/10/2003 Transferred from Mrs. Amena Begum 1,600
14,290 14-04-2005 New Allotment 1,429,000
1,148,960 20-11-2011 Bonus
1,707,420 2/2/2012 Placement 17,074,200
9,500,000 30-09-2012 Transferred from M/S A K Enterprise 95,000,000
-7,079,986 5/12/2013 Transferred to Mr. Abdus Salam. 70,799,860
1,500,000 22-12-2013 Bonus
655,000 28-12-2017 Transferred from Mr. Mohd. Jan e Alam 65,50,000
655,000 28-12-2017 Transferred from Mr. Mohd. Zakaria Alam 65,50,000
2 Mr. Mohd. Rezaul Karim, Managing
Director
500 1/8/2002 Date of incorporation 5,000
56 30-09-2003 Transferred from Late Mr. Hajee Ahmed Hossain 5,600
16 2/10/2003 Transferred from Mrs. Hosnara Begum 1,600
14,285 14-04-2005 New Allotment 1,428,500
1,188,560 20-11-2011 Bonus
1,662,870 2/2/2012 Placement 16,628,700
9,500,000 30-09-2012 Transferred from M/S A K Enterprise 95,000,000
-7,079,986 5/12/2013 Transferred to Mr. Abdus Salam. 70,799,860
1,500,000 22-12-2013 Bonus
655,000 28-12-2017 Transferred from Mr. Mohd. Jan e Alam 65,50,000
655,000 28-12-2017 Transferred from Mr. Mohd. Zakaria Alam 6,550,000
3 Mr. Mohd. Asfak Hoissain, Director
500,000 27-11-2011 Placement 5,000,000
12,000,000 30-09-2012 Transferred from M/S A K Enterprise 120,000,000
100,000 21-11-2012 Transferred from Mr. Aminul Karim 1,000,000
-7,079,986 5/12/2013 Transferred to Mr. Abdus Salam. 70,799,860
1,512,000 22-12-2013 Bonus
52,812 30-12-2013 Transferred from M/S. Real Biz 528,120
764,792 30-12-2013 Transferred from M/S. Friends Corporation 76,479,200
50,000 29-09-2015 Transferred from Mr. Abdul Mabud 500,000
655,000 28-12-2017 Transferred from Mr. Mohd. Jan e Alam 65,50,000
655,000 28-12-2017 Transferred from Mr. Mohd. Zakaria Alam 65,50,000
4 Mr. Mohd. Abrar Hossain, Director
500,000 27-11-2011 Placement 5,000,000
2,500,000 2/2/2012 Placement 25,000,000
9,500,000 30-09-2012 Transferred from M/S A K Enterprise 95,000,000
-7,079,985 5/12/2013 Transferred to Mr. Abdus Salam. 70,799,850
1,500,000 22-12-2013 Bonus
435,208 30-12-2013 Transferred from M/S. Friends Corporation 4,352,080
382,396 30-12-2013 Transferred from M/S. Amara Corporation 3,823,960
50,000 29-09-2015 Transferred from Mr Abul Hashem 500,000
655,000 28-12-2017 Transferred from Mr. Mohd. Jan e Alam 65,50,000
655,000 28-12-2017 Transferred from Mr. Mohd. Zakaria Alam 6,550,000
5 Mr. Mohd. Asrar Hossain, Director
500,000 27-11-2011 Placement 5,000,000
12,000,000 30-09-2012 Transferred from M/S A K Enterprise 120,000,000
90
-7,079,985 5/12/2013 Transferred to Mr. Abdus Salam. 70,799,850
1,512,000 22-12-2013 Bonus
52,812 30-12-2013 Transferred from M/S. Real Biz 528,120
764,792 30-12-2013 Transferred from M/S. Friends Corporation 7,647,920
50,000 29-09-2015 Transferred from Mr. Baktir Mea 500,000
655,000 28-12-2017 Transferred from Mr. Mohd. Jan e Alam 6,550,000
655,000 28-12-2017 Transferred from Mr. Mohd. Zakaria Alam 6,550,000
6 Mr. Mohd. Eradat Ullah, FCA
- - - -
7 Mr. Md. Golam Moin Uddin Chowdhury
- - - -
(m) If the sponsors or directors do not have experience in the proposed line of business, the fact explaining how the proposed activities would be carried out or managed;
All the Sponsors and Directors of MEBPOY have experience in the business of the Company. Since the expansion project is in the same line of business, it will be carried out efficiently and effectively.
(n) Interest of the key management persons
The Directors of MEBPOY is not taking any remuneration and other benefit from the company except the board meeting attendance fee. The following table shows the interest of the key management persons.
Sl. Name of top five salaried officer Position Basis of Amount (Tk. Per month)
Salaries Paid (Amount in Taka)
01.07.17 -30.09.17 30 June 2017
1 Mr. Mohd. Shahidullah Khan CFO 121129.00 363387.00 1453548.00
2 Mr. Mohammed Mozaffor Ahmed Company Secretary 32594.90 97784.70 391138.80
3 Mr. Ashraf Hossain DGM (Factory) 49522.50 148567.50 594270.00
4. Md. Habibur Rahman DGM (Finance) 66000.00 198000.00 792000.00
5 Mr. Shahidul Islam Manager (Production) 81119.00 243357.00 973428.00
6 Mohd. M A Kabir Manager (Utility) 38324.70 114974.10 459896.40
7 Md. Nurul Momen Manager (Accounts) 37194.80 111584.40 446337.60
8 Md. Ataullah Chy. Manager (Personnel) 38432.20 115296.60 461186.40
(o) All interests and facilities enjoyed by a director, whether pecuniary or non-pecuniary;
There were no such interests and facilities in the form of pecuniary and non-pecuniary enjoyed by the Directors except the board meeting attendance fee.
(p) Number of shares held and percentage of shareholding (pre issue);
Sl. Name Securities owned Before IPO
No. of Share %
Shareholding by Directors
1 Mr. Sydul Karim 8,230,014 4.90
2 Mohd. Rezaul Karim 8,230,014 4.90
3 Mohd. Abrar Hossain 9,097,619 5.42
4 Mohd. Asfak Hossain 9,209,618 5.48
5 Mohd. Asrar Hossain 9,097,619 5.42
Sub total 43,864,884 26.11
Shareholding by sponsors -
6 Mohd. Shamsul Alam 2,603,966 1.55
7 Mohd. Nurul Absar 1,497,384 0.89
8 Mohd. Nurul Alam 1,497,384 0.89
9 Mohd. Khurshed Alam 2,603,967 1.55
10 Mohd. Murshed Alam 2,604,067 1.55
11 Mohd. Aminul Karim 3,248,000 1.93
Sub total 14,054,768 8.37
Shareholding by other than Sponsors and Directors -
12 Mr. Abdus Salam 26,880,000 16.00
13 Mir Mohammad Hossain 15,120,000 9.00
14 Mir Muhammad Nasir 15,120,000 9.00
15 Mir Mohammed Hassan 15,120,000 9.00
16 Mr. Jan-E- Alam 3,645,014 2.17
17 Mr. Zakaria Alam 3,645,014 2.17
91
18 Mohd. Rashedul Alam 2,520,000 1.50
19 Mohd. Asraf Hossain 3,360,000 2.00
20 Mr. Hasan Imam Chowdhury 3,360,000 2.00
21 Mr. Liakat Ali Chowdhury 2,800,000 1.67
22 Swadesh Investment Management Ltd. 2,324,000 1.38
23 A.K.M Suja Chowdhury 2,240,000 1.33
24 Md. Jamil Abedin 1,120,000 0.67
25 Md. Zaynal Abedin 1,120,000 0.67
26 Mrs. Urmy Akhter, 1,120,000 0.67
27 Md. Moslem Uddin 1,120,000 0.67
28 Shamsul Alam 616,000 0.37
29 Md. Nobab Khan 560,000 0.33
30 Md. Alauddin 560,000 0.33
31 Mr. R.Y. Shamsher 560,000 0.33
32 Mr. Motiur Rahman 560,000 0.33
33 People’s Leasing & Financial Service Ltd. 560,000 0.33
34 Md. Nowshad Ahmed Chy & Giass Uddin 560,000 0.33
35 Arssmas Trading 532,000 0.32
36 H.M. Akhtarul Alam 392,000 0.23
37 Mr. Nasiruddin Chowdhury 336,000 0.20
38 M/s. Azan Stores 336,000 0.20
39 Mrs. Syeda Nurun Nahar 324,800 0.19
40 Horizon Network 252,000 0.15
41 Houssain Al Ashkari 224,000 0.13
42 Mr. Anis Uddin 196,000 0.12
43 Mrs. Mymuna Khatun & Mr. Ahmed Sabur 168,000 0.10
44 Capt. A.S.M. Shah Alam 150,080 0.09
45 Mrs. Hamida Bilquish Chowdhury 140,000 0.08
46 Md. Abu Bakar Siddique 123,200 0.07
47 Mr. Nawshed Ahmed Chowdhury 112,000 0.07
48 Mr. Nazmi Saifuddin 112,000 0.07
49 Mr. Khurshed Ul Alam 112,000 0.07
50 Md. Imamul Hoque 112,000 0.07
51 Mrs. Nazia Farzeen 112,000 0.07
52 Md. Khorshed Alam 112,000 0.07
53 Mr. Mohammad Wasim 112,000 0.07
54 Mr.Naim Hassan 112,000 0.07
55 Mr. Zabed Ul Alam 112,000 0.07
56 Mr. Modhusudan Bhowmik 112,000 0.07
57 Mr. Saleh Johur Mia 112,000 0.07
58 Abdullah al Mamun 112,000 0.07
59 Mr. Mohammed Jamal Uddin 67,200 0.04
60 Mr. Saifuddin Joher 67,200 0.04
61 Mrs. Tahmina Begum 63,840 0.04
62 Mr. Hasan Murad Siddique 56,000 0.03
63 Mr. Abdul Mabud 6,000 0.00
64 Mr. Abul Hashem 6,000 0.00
65 Mr. Abul Kashem 56,000 0.03
66 Mr. Boktir Meah 6,000 0.00
67 Mr. Miskatul Islam Chowdhury 56,000 0.03
68 A M Monowar Hossain(Rajib) 56,000 0.03
69 Mrs. Nishat Jarin 56,000 0.03
70 Mr. Forkan Ahmed Nahid 56,000 0.03
71 Mr. Tahmid Anwar 56,000 0.03
72 Md. Shohebul Hassan 56,000 0.03
73 Mr. Shalah Uddin Ahmed 56,000 0.03
74 Mir Motaher Hossain 56,000 0.03
92
75 Jahangir Alam 56,000 0.03
76 Mr. Firoz Saifuddin Joher 44,800 0.03
77 Mr. Sohel Uddin Kader Chowdhury 28,000 0.02
78 Mr. Chandan Dhar 28,000 0.02
79 Solaiman Member 28,000 0.02
80 S .K. Shahidul Alam 11,200 0.01
Sub total 110,080,348 65.52
Grand Total 168,000,000 100.00
(q) Change in board of directors during last three years;
Name of the directors Position Date of appointment Date of retirement
Mr. Sydul Karim Chairman 25-08-2013 Retired & re-elected
Mr. Mohd. Rezaul Karim Managing Director 15-09-2011 Retired & re-elected
Mr. Mohd. Abrar Hossain Director 20-12-2012 Retired & re-elected
Mr. Mohd. Asfak Hossain Director 21-11-2012 Retired & re-elected
Mr. Mohd. Asrar Hossain Director 20-12-2012 Retired & re-elected
Mr. Mohd. Eradat Ullah, FCA Independent Director 08-10-2017 -
Mr. Md. Golam Moin Uddin Chowdhury
Independent Director 03-12-2017 -
(r) Director’s engagement with similar business.
No director of the Company is engaged in similar business.
93
CHAPTER- IX CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
94
(a) The prospectus shall contain a description of any transaction during the last five years, or any proposed transactions certified by the auditors, between the issuer and any of the following persons, giving the name of the persons involved in the transaction, their relationship with the issuer, the nature of their interest in the transaction and the amount of such interest, namely: -
(i) Any director or sponsor or executive officer of the issuer;
(ii) Any person holding 5% or more of the outstanding shares of the issuer;
(iii) Any related party or connected person of any of the above persons
(b) Any transaction or arrangement entered into by the issuer or its subsidiary or associate or entity owned or significantly influenced by a person who is currently a director or in any way connected with a director of either the issuer company or any of its subsidiaries or holding company or associate concerns, or who was a director or connected in any way with a director at any time during the last three years prior to the issuance of the prospectus;
Except as describe above, no transaction or arrangement entered into by the issuer or its subsidiary or associate or entity owned or significantly influenced by a person who is currently a director or in any way connected with a director of the issuer company or its subsidiary/holding company or associate concerns or who was a director or connected in any way with a director at any time during the last three years prior to the issuance of the prospectus.
(c) Any loans either taken or given from or to any director or any person connected with the director, clearly specifying details of such loan in the prospectus, and if any loan has been taken from any such person who did not have any stake in the issuer, its holding company or its associate concerns prior to such loan, rate of interest applicable, date of loan taken, date of maturity of loan, and present outstanding of such loan.
No loan was taken or given from or to any director or any person connected with the director and no loan was taken from any such person who did not have any stake in the issuer, its holding Company or its associate concerns.
P o s it io n P e rio d Ende d 3 0
S e pte m be r, 2 0 17
Ye a r Ende d 3 0
J une , 2 0 17
P e rio d Ende d
3 0 J une , 2 0 16
Ye a r Ende d 3 1
D e c e m be r, 2 0 15
Ye a r Ende d 3 1
D e c e m be r,
2 0 14
Ye a r Ende d 3 1
D e c e m be r, 2 0 13
Ye a r Ende d 3 1
D e c e m be r, 2 0 12
Md.Zakaria Alam Chairman - - - - - - 2,880,000
Md.Rezaul Karim Managing Director - - - - - 2,400,000 2,400,000
Md.Nurul Alam Executive Director - - - - - 1,920,000 1,920,000
Md.Jane Alam Director - - - - - - 1,920,000
Md.Aminul Karim Director - - - - - - 1,920,000
Md.Sydul Karim Director - - - - - - 1,920,000
Sub Total - - - - - 4,320,000 12,960,000
P o s it io n P e rio d Ende d 3 0
S e pte m be r, 2 0 17
Ye a r Ende d 3 0
J une , 2 0 17
P e rio d Ende d
3 0 J une , 2 0 16
Ye a r Ende d 3 1
D e c e m be r, 2 0 15
Ye a r Ende d 3 1
D e c e m be r,
2 0 14
Ye a r Ende d 3 1
D e c e m be r, 2 0 13
Ye a r Ende d 3 1
D e c e m be r, 2 0 12
Sydul Karim Chairman 3,000 12,000 6,000 14,000 - - -
Mohd. Rezaul Karim Managing Director 3,000 12,000 6,000 14,000 - - -
Mohd. Abrar Hossain Director 3,000 12,000 6,000 14,000 - - -
Mohd. Asfaq Hossain Director 3,000 12,000 6,000 14,000 - - -
Mohd. Asrar Hossain Director 3,000 12,000 6,000 14,000 - - -
Sub Total 15,000.00 60,000.00 30,000.00 70,000.00 - - -
Note:
1. The figures represents from Audited Financial Statement for respective years.
Sd/-
Ahm ed Zaker & Co. Place: Chi ttagong
Chartered Accountants Dated: 10 Dec 2017
Name
Amount in (BDT)
2.Financial statements for the period ended September 30, 2017 & June 30, 2016 and for the year ended June 30, 2017 were audited by us. Financial statements for
the year ended December 31, 2015, 2014 ,2013 & 2012 were audited by Rahman Mostafa Alam & Co. Chartered Accountants.
Auditors Certificate Regarding Related Party Transaction of Mohammed Elias Brothers Poy Manufacturing Plant Limited.
Based on our scrutiny of the financial statements and other relevant records of Mohammed Elias Brothers Poy Manufacturing Plant Limited. which have been
prepared by Management of the Company and produced to us for our review, and on the basis of representation from management, we certify that as per the
disclosure provided in those documents the Company has enter into the following transactions during the last five years were as follows:
Name
Amount in (BDT)
B: Board Meeting Fee
A: Director Remuneration
95
CHAPTER – X EXECUTIVE COMPENSATION
96
(a) The total amount of remuneration or salary or perquisites paid to the top five salaried officers of the issuer in the last accounting year and the name and designation of each such officer;
Sl. Name of top five salaried officer Position Basis of Amount
(Tk. Per month)
Salaries Paid (Amount in Taka)
Period ended 01.07.17 -30.09.17
Year ended as on 30 June 2017
1 Mr. Mohd. Shahidullah Khan CFO 121129.00 363387.00 1453548.00
2 Mr. Mohammed Mozaffor Ahmed Company Secretary 32594.90 97784.70 391138.80
3 Mr. Ashraf Hossain DGM (Factory) 49522.50 148567.50 594270.00
4. Md. Habibur Rahman DGM (Finance) 66000.00 198000.00 792000.00
5 Mr. Shahidul Islam Manager (Production) 81119.00 243357.00 973428.00
6 Mohd. M A Kabir Manager (Utility) 38324.70 114974.10 459896.40
7 Md. Nurul Momen Manager (Accounts) 37194.80 111584.40 446337.60
8 Md. Ataullah Chy. Manager (Personnel) 38432.20 115296.60 461186.40
(b) Aggregate amount of remuneration paid to all directors and officers as a group during the last accounting year;
Sl. Particulars Remuneration paid for the period (Taka) 01.07.17-30.09.17 FY 2017 FY 2016 (6 Months)
1 Directors’ remuneration & salary - - -
2 Salary and allowance 1,22,40,754 5,15,84,488 23,513,485
Total 1,22,40,754 5,15,84,488 23,513,485
(c) If any shareholder director received any monthly salary or perquisite or benefit it must be mentioned along with date of approval in AGM or EGM, terms thereof and payments made during the last accounting year;
No shareholder director received any monthly salary or perquisite or benefit except board meeting attendance fee.
(d) The board meeting attendance fees received by the director including the managing director along with date of approval in AGM or EGM
The Directors of the Company are entitled to receive board meeting attendance fee of Tk. 3,000 for attending each meeting which was approved in the AGM dated 17.12.2015.
(e) Any contract with any director or officer providing for the payment of future compensation
No contract was made with any director or officer providing for the payment of future compensation.
(f) If the issuer intends to substantially increase the remuneration paid to its directors and officers in the current year, appropriate information regarding thereto
The Company reviews remuneration of its all officers (excluding all Director & Managing Director) as per Company’s employment policy.
(g) Any other benefit or facility provided to the above persons during the last accounting year.
Apart from the aforementioned information, the Company does not provide any other benefit’
97
CHAPTER – XI OPTIONS GRANTED TO DIRECTORS, OFFICERS AND EMPLOYEES
98
Options Granted to Directors, Officers and Employees
(1) The following information in respect of any option held by each director, the salaried officers, and all other officers as a group, namely: -
i. The date on which the option was granted; ii. The exercise price of the option;
iii. The number of shares or stock covered by the option; iv. The market price of the shares or stock on the date the option was granted; v. The expiration date of the option;
vi. Consideration against the option. No options have been granted by the Company to any director, officers or employees.
(2) If such options are held by any person other than the directors, and the officers of the issuer company, the following information shall be given in the prospectus, namely: -
i. The total number of shares or stock covered by all such outstanding options;
ii. The range of exercise prices;
iii. The range of expiration dates;
iv. Justification and consideration of granting such option. No options have been granted by the Company to any director, officers or employees
99
CHAPTER – XII TRANSACTION WITH THE DIRECTORS AND SUBSCRIBERS TO THE MEMORANDUM
100
(a) The names of the directors and subscribers to the memorandum, the nature and amount of anything of value received or to be received by the issuer from the above persons, or by the said persons, directly or indirectly, from the issuer during the last five years along with the description of assets, services or other consideration received or to be received;
Name & Position Nature of value received 01.07.17-30.09.17
FY 2017 01.01.16-30.06.16
2015 2014 2013 2012
Sydul Karim Chairman
Salary - - - - - 1920000 1920000
Other remuneration - - - - - - -
Board attendance fees 3000 12000 6000 14000 8000 - -
Dividend (Stock) - - - - - 1500000 -
Cash dividend - - - - - - -
Mohd. Rezaul Karim Director & Managing Director
Salary - - - - - 2400000 2400000
Other remuneration - - - - - - -
Board attendance fees 3000 12000 6000 14000 8000 - -
Dividend (stock) - - - - - 1500000 -
Cash dividend - - - - - - -
Mohd. Abrar Hossain Director
Salary - - - - - 720000 -
Other remuneration - - - - - - -
Board attendance fees 3000 12000 6000 14000 8000 - -
Dividend (stock) - - - - - 1500000 -
Cash dividend - - - - - - -
Mohd. Asfak Hossain Director
Salary - - - - - 600000 -
Other remuneration - - - - - - -
Board attendance fees 3000 12000 6000 14000 8000 - -
Dividend (stock) - - - - - 1512000 -
Cash dividend - - - - - - -
Mohd. Asrar Hossain Director
Salary - - - - - 600000 -
Other remuneration - - - - - - -
Board attendance fees 3000 12000 6000 14000 8000 - -
Dividend (stock) - - - - - 1512000 -
Cash dividend - - - - - - -
Md. Golam Moin Uddin Chowdhury
Salary - - - - - - -
Other remuneration - - - - - - -
Board attendance fees - - - - - - -
Dividend (stock) - - - - - - -
Cash dividend - - - - - - -
Mohd. Eradat Ullah, FCA Independent Director
Salary - - - - - - -
Other remuneration - - - - - - -
Board attendance fees - - - - - - -
Dividend (stock) - - - - - - -
Cash dividend - - - - - - -
(b) If any assets were acquired or to be acquired within next two financial years from the aforesaid persons, the amount paid for such assets and the method used to determine the price shall be mentioned in the prospectus, and if the assets were acquired by the said persons within five years prior to transfer those to the issuer, the acquisition cost thereof paid by them.
The Company did not acquire or plan to acquire any assets from its directors and subscribers to the memorandum.
101
CHAPTER – XIII OWNERSHIP OF THE COMPANY’S SECURITIES
102
(a) The names, addresses, BO ID Number of all shareholders of the company before IPO, indicating the amount of securities owned and the percentage of the securities represented by such ownership, in tabular form;
Sl. Name of Shareholders Address BO ID Number No. of Shares % of securities
owned Before IPO
Shareholding by Directors
1 Mr. Sydul Karim 100, Khatungonj, Chittagong 1201 8400 4030 8269 8,230,014 4.90%
2 Mohd. Rezaul Karim 100, Khatungonj, Chittagong 1201 5900 6417 2090 8,230,014 4.90%
3 Mohd. Abrar Hossain 100, Khatungonj, Chittagong 1201 5900 6417 1971 9,097,619 5.42%
4 Mohd. Ashfak Hossain 100, Khatungonj, Chittagong 1201 5900 6417 2082 9,209,618 5.48%
5 Mohd. Asrar Hossain 100, Khatungonj, Chittagong 1201 5900 6417 8494 9,097,619 5.42%
Sub total 43,864,884 26.12%
Shareholding by sponsors
6 Mohd. Shamsul Alam 100, Khatungonj, Chittagong 1203 7300 0646 4790 2,603,966 1.55%
7 Mohd. Nurul Absar 100, Khatungonj, Chittagong 1201 8400 0646 4787 1,497,384 0.89%
8 Mohd. Nurul Alam 100, Khatungonj, Chittagong 1201 5900 6417 2066 1,497,384 0.89%
9 Mohd. Khurshed Alam 100, Khatungonj, Chittagong 1201 6000 2154 6638 2,603,967 1.55%
10 Mohd. Murshed Alam 100, Khatungonj, Chittagong 1203 7900 6430 4318 2,604,067 1.55%
11 Mohd. Aminul Karim 100, Khatungonj, Chittagong 1201 5900 6417 2015 3,248,000 1.93%
Sub total 14,054,768 8.36%
Other Shareholding
12 Mr. Abdus Salam 234,Khatungonj, Chittagong, post code : 4000 1204 2900 4465 5722 26,880,000 16.00%
13 Mir Mohammad Hossain 234,Khatungonj, Chittagong, post code : 4000 - 15,120,000 9.00%
14 Mir Muhammad Nasir 234,Khatungonj, Chittagong, post code : 4000 - 15,120,000 9.00%
15 Mir Mohammed Hassan 234,Khatungonj, Chittagong, post code : 4000 1204 2900 6431 4259 15,120,000 9.00%
16 Mr. Jan-E- Alam 100, Khatungonj, Chittagong 1201 5900 4499 6510 3,645,014 2.17%
17 Mr. Zakaria Alam 100, Khatungonj, Chittagong 1201 8400 2119 6961 3,645,014 2.17%
18 Mohd. Rashedul Alam 100, Khatungonj, Chittagong. - 2,520,000 1.50%
19 Mohd. Asraf Hossain 100, khatungonj,Chittagong. 1201 8400 3366 1076 3,360,000 2.00%
20 Mr. Hasan Imam Chowdhury Azizia Manzil, 13, Mehdibagh Road, Chittagong. 1203 2200 4274 4276 3,360,000 2.00%
21 Mr. Liakat Ali Chowdhury As-salam Tower (9th Floor)57, Agrabad C/A, Chittagong 1201 5900 3280 3323 2,800,000 1.67%
22 Swadesh Investment Management Ltd.
Suite-01, Level-11, Unique Trade Center 8, Panthapath, Kawran Bazar, Dhaka-1215.
1204 3800 2185 5128 2,324,000 1.38%
23 A.K.M Suja Chowdhury Progressive designer, 2 CDA C/A, Brac Bank Building (8th floor), Momin Road, Chittagong.
1204 0900 2318 2598 2,240,000 1.33%
24 Md. Jamil Abedin House# 659, Mak Garden, West Kulshi R/A, Road# 01 Chittagong-4202.
1203 2200 3942 6164 1,120,000 0.67%
25 Md. Zaynal Abedin Road# 1, House# 21, Block# 1, Banani, Dhaka. 1203 2200 3801 4533 1,120,000 0.67%
26 Mrs. Urmy Akhter, MAA Building (1st floor) 68,Bundle Road, patherghata, Chittagong.
1203 6800 4471 9396 1,120,000 0.67%
27 Md. Moslem Uddin M/S M.G. Trading. 295 no. Chalpatty, Chaktai, CTG. 1301 0300 0020 7430 1,120,000 0.67%
28 Shamsul Alam Salma Bhaban, House# 12, Road# 02, Nasirabad Housing Society. 1203 2200 3145 0868 616,000 0.37%
29 Md. Nobab Khan Sultan Market (2nd Floor) 151, S.K. Mujib Road, Agrabad C/A, Chittagong.
1201 8900 0776 2574 560,000 0.33%
30 Md. Alauddin House#659, Mak Garden, West Kulshi R/A, Road# 01 Chittagong-4202.
1203 2200 3942 6959 560,000 0.33%
31 Mr. R.Y. Shamsher “Southern Wood” Plot#B-2, Road#14, House#06, Dhanmondi R/A.Dhaka.
1204 0900 1541 6341 560,000 0.33%
32 Mr. Motiur Rahman “Paramounts Heights” (12th Floor) PLFS 65/211, Box Culvert Road, Purana Paltan, Dhaka.
1202 8800 0413 3529 560,000 0.33%
33 People’s Leasing & Financial Service Ltd.
Paramount Heights 12th & 13th 65/2/1, Box Culvert Road Purana Paltan, Dhaka-1000
1202 8800 1554 3649 560,000 0.33%
34 Md. Nowshad Ahmed Chy & Giass Uddin
Raihan manzil, 149 Sholak Bohar Panchlaish, Chittagong. 1204 9000 4475 8382 560,000 0.33%
35 Arssmas Trading J. Height's Building, IFIC Bank Ltd, Pragati Sarani Br. Cha-72/1/D, Uttar Badda, Dhaka-1212.
1203 2200 4480 4943 532,000 0.32%
36 H.M. Akhtarul Alam Plot No-05, Road-01, Block-B, Aftabnagar, Badda, Dhaka. 1202 4300 0392 9189 392,000 0.23%
37 Mr. Nasiruddin Chowdhury Nasiruddin and Brothers, 400/398 Eklas market (2nd floor) Khatungonj, Chittagong.
1202 9900 3693 2861 336,000 0.20%
38 M/s. Azan Stores 232/20, Nabi Super Market, Khatungonj, Chittagong. 1202 9900 3810 5534 336,000 0.20%
39 Mrs. Syeda Nurun Nahar 1240, Imam Villa, East Nasirabad, Zakir Hossain Road, Chittagong.
1203 2200 1653 1644 324,800 0.19%
40 Horizon Network A.J. Height's Building, IFIC Bank Ltd, Pragati Sarani Br. Cha-72/1/D, Uttar Badda, Dhaka-1212.
1203 2200 4481 2007 252,000 0.15%
41 Houssain Al Ashkari 386/A, Shorna Mansion, Giridhara R/A,Flora Pass Road, Ambagan, Khulshi, Ctg.
1201 5900 6421 8012 224,000 0.13%
42 Mr. Anis Uddin Moinuddin Corporation (2nd Floor) 774, M.A. Salam Market, Asadgonj, Chittagong.
1203 7900 0384 3412 196,000 0.12%
43 Mrs. Mymuna Khatun & Mr. Ahmed Sabur
Mohammad Elias Brothers (Pvt.) Ltd.100, Khatungonj, Chittagong. 1202 8500 4497 4450 168,000 0.10%
44 Capt. A.S.M. Shah Alam VEGA MARINE (PVT.) LTD. Daar-E- Shahid (4th Floor) 69, Agrabad, C/A, Chittagong.
1203 2200 3767 8677 150,080 0.09%
45 Mrs. Hamida Bilquish Chowdhury
183, Green Road, Baitul Laz, Dhaka. 1203 9200 3283 1160 140,000 0.08%
46 Md. Abu Bakar Siddique 325, Jahangir & other’s Asadgonj, Chittagong. 1203 7900 0427 7249 123,200 0.07%
47 Mr. Nawshed Ahmed Chowdhury
MEEM Hill View, Flat # 301, Hill View Road # 1 1203 6800 0509 8491 112,000 0.07%
48 Mr. Nazmi Saifuddin 13,Battali Road, Enayet Bazar. Chittagong. 1201 7800 0053 6222 112,000 0.07%
103
49 Mr. Khurshed Ul Alam Elite Trading Ltd. R.B. Court 54, Agrabad C/A, Chittagong. 1203 5600 0015 1958 112,000 0.07%
50 Md. Imamul Hoque Unit- 5, Munni Plaza(3rd Floor) 2 Probortok avenue, Chittagong. 1204 7500 4498 7352 112,000 0.07%
51 Mrs. Nazia Farzeen 1385, East Nasirabad, Chittagong. 1201 5900 0138 1402 112,000 0.07%
52 Md. Khorshed Alam Bhuiyan Aluminium, 58, Muradpur, Mirzapurl, Chittagong. 1203 2200 1968 6883 112,000 0.07%
53 Mr. Mohammad Wasim House-305, Road-8, Agrabad R/A CDA, Chittagong. 1201 6800 1614 1505 112,000 0.07%
54 Mr. Naim Hassan Plot 91,Block-K,Suhrawardy Avenue Baridhara,Dhaka. 1203 2100 2159 9207 112,000 0.07%
55 Mr. Zabed Ul Alam Alam Trading Con. 173, Badsha Market,Khatungonj, Chittagong
1203 7900 0437 2994 112,000 0.07%
56 Mr. Modhusudan Bhowmik M/s. Baikutha Kumar Nath Bank Road, Chaumuhani, Noakhali. 1202 0900 3543 2166 112,000 0.07%
57 Mr. Saleh Johur Mia Quader Villa, 1401 Hazeepara Agrabad, Chittagong. 1204 2800 2138 7958 112,000 0.07%
58 Abdullah al Mamun 12, Lake Circus (2nd Floor), Kolabagan, Dhaka-1205 1201480018017139 112,000 0.07%
59 Mr. Mohammed Jamal Uddin Equity Harmony Flat-A-2,1 East Shahid Mirza Lane 1117 Mehedibagh, Chittagong.
1203 2200 1831 0271 67,200 0.04%
60 Mr. Saifuddin Joher 36, Surson road, Sanmar Valencia # 5D, Chittagong. 1201 7800 3734 7728 67,200 0.04%
61 Mrs. Tahmina Begum Mostafijur Rahman House D.C.Road, Boubazar,P.O.Chawkbazar, Bakwalia-4203, Chittagong.
1203 7900 3693 4411 63,840 0.04%
62 Mr. Hasan Murad Siddique Hajee Salam Villa, 18 No Ward Azim Road, East Bakalia, Bajraghona, Chittagong.
1203 7900 3775 1425 56,000 0.03%
63 Mr. Abdul Mabud Bismilla Steel Corporation, Rahattar Pool, East Sholoshar, Bakalia, Chittagong.
1201 6000 1921 7759 6,000 0.01%
64 Mr. Abul Hashem Waizar Para Road, Fakir Sowdagar Bari East Bakalia, Chittagong.
1203 7900 3775 8443 6,000 0.01%
65 Mr. Abul Kashem Waizar Para Road, Fakir Sowdagar Bari East Bakalia, Chittagong.
1203 7900 3798 5871 56,000 0.03%
66 Mr. Boktir Meah Golam Sharif & Sons, 212 Abdullah Siddir Road Reazuddin Bazar, Chittagong.
1301 0300 1335 0791 6,000 0.01%
67 Mr. Miskatul Islam Chowdhury
JIC Securities Ltd., 950/C, Osman Manjil (1st Floor) Ashadgonj, Chittagong.
1301 0300 0007 7319 56,000 0.03%
68 Amir Muhammad Monowar Hossain (Rajib)
House-59/B (1st floor), R-2, Shugandha R/A Panchlish (in front of Ekushey Hospital), Chittagong.
1203 0600 2033 6160 56,000 0.03%
69 Mrs. Nishat Jarin Tarek Main Uddin, Bank Asia Ltd. Kamal Bazar, kabirTower,Mohara,Ctg.
1204 1800 2552 3040 56,000 0.03%
70 Mr. Forkan Ahmed Nahid Gunjan, House# 107, Road#09,O.R. Nizam Road R/A, Chittagong 1203 2200 1892 8746 56,000 0.03%
71 Mr. Tahmid Anwar Equity Fortuan 5C, 100 Panchlaish R/A. Chittagong. 1202 7400 3802 4937 56,000 0.03%
72 Md. Shohebul Hassan “Crystal Cars” 546, S.K. Mujib Road Agrabad, Chittagong. 1202 4000 1743 1460 56,000 0.03%
73 Mr. Shalah Uddin Ahmed House-200, Road-09, Block-B, Chandgaon R/A, Chandgaon, Chittagong
1201 8400 3941 1924 56,000 0.03%
74 Mir Motaher Hossain Keari Masud, Flat: C-6, Road-3,House:74/A, Nasirabad Housing Society, Chittagong.
1204 5900 4130 6478 56,000 0.03%
75 Jahangir Alam Flat# B5, E.M. Villa, 121, Ibrahimpur, Cantonment, Dhaka. 1203 6800 0859 3899 56,000 0.03%
76 Mr. Firoz Saifuddin Joher Bangladesh Trading Co. 128, jublee Road, Chittagong. 1203 3300 3246 5222 44,800 0.03%
77 Mr. Sohel Uddin Kader Chowdhury
Rafiq Mansion, 287/A, CDA Avenue, Muradpur, Chittagong. 1204 180 0397 64157 28,000 0.02%
78 Mr. Chandan Dhar Pioneer Insurance Co. Ltd. 30, Agrabad C/A, Chittagong 1202 1300 1858 1339 28,000 0.02%
79 Solaiman Member Bania Para, Bhatiary ward no-5, West Side of Mostafa Oil Mills Ltd. P.O.: Bhatiary, P.S: Shitakunda, Chittagong.
1301 0300 0023 3145 28,000 0.02%
80 S. K. Shahidul Alam 542, Asian Housing Society, Sholakbahar, Chittagong. 1203470033104755 11,200 0.01%
Sub total 110,080,348
Grand Total 168,000,000 100%
Note: Mr. Mohd. Jan e Alam and Mr. Mohd. Zakaria Alam transferred their 3,275,000 numbers of share respectively to Mr. Sydul Karim, Chairman, Mr. Mohd. Rezaul Karim, Managing
Director, Mr. Mohd. Asfak Hoissain, Director, Mr. Mohd. Abrar Hossain, Director, Mr. Mohd. Asrar Hossain, Director in equal proportion in December 28, 2017, which was duly certified
by the RJSC.
(b) There shall also be a table showing the name and address, age, experience, BO ID Number, TIN number, numbers of shares held including percentage, position held in other companies of all the directors before the public issue
Sl Name of
Directors Addresses Age
Experience
(Years) BO ID No. ETIN No.
No. of
shares
held
Shareholding
(%) pre issue
Position held in other
companies
Name of the
Company position
1 Mr. Sydul
Karim
2292/A, MEB House, East
Sholosahar, Chawkbazar-4203,
Chandgaon, Chittagong.
43 14 yrs 1201 8400 4030 8269 476314355900 82,30,014 4.90
Dharithree Land
Management Ltd.
Managing
director
MNA Consumer
Products Limited
Managing
director
2 Mr. Mohd.
Rezaul Karim
2292/A, MEB House, East
Sholosahar, Chawkbazar-4203,
Chandgaon, Chittagong.
46 19 yrs 1201 5900 6417
2090 466173583933 82,30,014 4.90 - -
104
3 Mr. Mohd.
Abrar Hossain
2292/A, MEB House, East
Sholosahar, Chawkbazar-4203,
Chandgaon, Chittagong.
27 5 yrs 1201 5900 6417 1971 592092626432 9097619 5.42 - -
4 Mr. Mohd.
Asfak Hossain
2292/A, MEB House, East
Sholosahar, Chawkbazar-4203,
Chandgaon, Chittagong.
33 5 yrs 1201 5900 6417
2082 474077765373 9209618 5.48 - -
5 Mr. Mohd.
Asrar Hossain
2292/A, MEB House, East
Sholosahar, Chawkbazar-4203,
Chandgaon, Chittagong.
23 5 yrs 1201 5900 6417
8494 698910413655 9097619 5.42 - -
6
Mr. Md. Golam
Moin Uddin
Chowdhury
151 SK Mujib road Agrabad
C/A, Chittagong 52 25 yrs 1203640064105465 136099755209 - - - -
7
Mr. Mohd.
Eradat Ullah,
FCA
AIM Development Nilgiri,
100/122, Abdul Latif Road,
Panchlaish, Chittagong
74 45 yrs 1203080037084068 344579566634 - - - -
Grand total 27404856 26.11
(c) The average cost of acquisition of equity shares by the directors certified by the auditors;
Management Declaration Regarding Share Transfer The following transfer of shares have been made and Form-117 duly certified by RJSC after the certification of the Auditor regarding average cost of acquisition of equity shares by the directors:
Date of Allotment
Transfaror Shareholding
before transfer
Total Transfer
Shareholding after transfer
Tranfaree
Conside ration
Avg. cost
of Acquisition
Sydul Karim
Mohd. Rezaul Karim
Mohd. Asfak
Hossain
Mohd. Abrar Hossain
Mohd. Asrar Hossain
28-12-2017 Mohd. Jan e Alam 6,920,014 3,275,000 3,645,014 655,000 655,000 655,000 655,000 655,000 Gift 10.00
28-12-2017 Mohd. Zakaria Alam 6,920,014 3,275,000 3,645,014 655,000 655,000 655,000 655,000 655,000 Gift 10.00
Sd/- Sd/- Sd/- Sd/- Md. Mozaffor Ahmed
Company Secretary
Md. Shahidullah Khan
Chief Financial Officer
Mohd. Rezaul Karim
Director & Managing Director
Sydul Karim
Chairman (d) A detail description of capital built up in respect of shareholding (name-wise) of the issuer’s sponsors or directors.
In this connection, a statement to be included: -
`Name of Sponsor/ Director
Date of Allotment/ Transfer of
fully paid up shares
Co
nsi
de
rati
on
Nature of issue
No of Equity shares
Face value
Issue Price/
Acquisition Price/
Transfer Prices
Cumulative no. of equity shares % Pre
issue paid up capital
% Post issue
paid up capital
Sources of fund
Before transfer
share holding
Transfer share
After transfer Share
holding
Late Md Hajee Ahmed Hossain Sponsor
Date of incorporation
Cash Subscribed by
MOA 500 100.00 50000.00 500 500 - - - Own
Md. Shamsul Alam
Sponsor
Date of incorporation
Cash Subscribed by
MOA 833 100.00 5000.00 -
- 2603966 1.55 1.35 Own 14-04-2005 Cash New Allotment 25000 100.00 2500000.00 -
20-11-2011 Bonus Bonus 2066640 10.00 20666400.00 -
22-12-2013 Bonus Bonus 278996 10.00 2789960.00 -
Mr. Nurul Absar
Sponsor
Date of incorporation
Cash Subscribed by
MOA 500 100.00 50000.00 -
- 1497384 0.89 0.78 Own 30-09-2003 N/A Transmission 54 100.00 5400.00 -
105
02-10-2003 N/A Transmission 16 100.00 1600.00 -
14-04-2005 Cash Allotment 14285 10.00 1428500.00 -
20-11-2011 Bonus Bonus 1188400 10.00 11884000.00 -
20-12-2012 Bonus Bonus 160434 10.00 1604340.00 -
Md. Nurul Alam
Sponsor
Date of incorporation
Cash Subscribed by
MOA 500 100.00 50000.00 -
- 1497384 0.89 0.78 Own
30-09-2003 N/A Transmission 54 100.00 5400.00 -
02-10-2003 N/A Transmission 16 100.00 1600.00 -
14-04-2005 Cash Allotment 14285 10.00 1428500.00 -
20-11-2011 Bonus Bonus 1188400 10.00 11884000.00 -
22-12-2013 Bonus Bonus 160434 10.00 1604340.00 -
Md Khurshed Alam Sponsor
Date of incorporation
Cash Subscribed by
MOA 833 100.00 5000.00 -
- 2603967 1.55 1.35 Own 14-04-2005 Cash New Allotment 25000 100.00 2500000.00 -
20-11-2011 Bonus Bonus 2066640 10.00 20666400.00 -
22-12-2013 Bonus Bonus 278997 10.00 2789970.00 -
Mohd. Rezaul Karim Sponsor & Managing Director
01-08-2002 Cash Date of incorporation
500 100.00 50000.00 -
-
82,30,014 4.90 4.26 Own
30-09-2003 N/A Transmission 56 100.00 5600.00 -
02-10-2003 N/A Transmission 16 100.00 1600.00 -
14-04-2005 New Allotment 14285 100.00 1428500.00 -
20-11-2011 Bonus Bonus 1188560 10.00 11885600.00 -
02-02-2012 Cash Placement 1662870 10.00 16628700.00 -
30-09-2012 N/A Transmission 9500000 10.00 95000000.00 -
05-12-2013 Transferred. - 10.00 70799560.00 - 7079986
22-12-2013 Bonus Bonus 1500000 10.00 15000000.00 - -
28-12-2017 Gift Transferred 1310000 10.00 13100000.00 -
Md. Morshedul
Alam, Sponsor
Date of incorporation
Cash Subscribed by
MOA 833 100.00 5000.00 -
- 2604067 1.55 1.35 14-04-2005 Cash New Allotment 25000 100.00 2500000.00 -
20-11-2011 Bonus Bonus 20666720 10.00 206667200.00 -
22-12-2013 Bonus Bonus 278997 10.00 2789970.00 -
Md. Aminul Karim,
Sponsor
01-08-2002 Cash Date of incorporation
500 100.00 50000.00 -
- 3248000 1.93 1.68 Own
30-09-2003 N/A Transmission 56 100.00 5600.00 -
02-10-2003 N/A Transmission 16 100.00 1600.00 -
14-04-2005 Cash New Allotment 14285 100.00 1428500.00 -
20-11-2011 Bonus Bonus 1188560 10.00 11885600.00 -
02-02-2012 Cash Placement 1662870 10.00 16628700.00 -
22-12-2013 Bonus Bonus 348000 10.00 3480000.00 -
21-12-2013 Cash Transferred - 10.00 1000000.00 - 100000
Md. Sydul Karim,
Chairman
30-09-2003 N/A Transmission 56 100.00 5600.00 -
-
82,30,014 4.90 4.26 Own
02-10-2003 N/A Transmission 16 100.00 1600.00 -
14-04-2005 Cash New Allotment 14290 100.00 1429000.00 -
20-11-2011 Bonus Bonus 1148960 10.0 11489600.00 -
02-02-2012 Cash Placement 1707420 10.00 17074200.00 -
30-09-2012 N/A Transmission 9500000 10.00 95000000.00 -
05-12-2013 Cash Transferred. - 10.00 70799560.00 - 7079986
22-12-2013 Bonus Bonus 1500000 10.00 15000000.00 - -
28-12-2017 Gift Transferred. 1310000 10.00 13100000.00 -
Mohd. Asfak Hossain, Director
27-11-2011 Cash Placement 500000 10.00 5000000.00 -
-
9209618 - 4.77 Own
30-09-2012 N/A Transmission 12000000 10.00 12000000.00 -
21-11-2012 N/A Transmission 100000 10.00 1000000.00 -
05-12-2013 Cash Transferred - - - - 7079986
22-12-2013 Bonus Bonus 1512000 - - - -
30-12-2013 Cash Transferred - - - - 52812
30-12-2013 Cash Transferred - - - - 764792
29-09-2015 N/A Transmission 50000 10.00 500000.00 -
- 28-12-2017 Gift Transferred. 1310000 10.00 13100000.00 -
`Mohd. Abrar Hossain, Director
27-11-2011 Cash Placement 500000 10.00 5000000.00 -
9097619 5.42 4.71 Own
02-02-2012 Cash Placement 10.00 25000000.00 -
30-09-2012 N/A Transmission 10.00 95000000.00
05-12-2013 Cash Transferred. 7079985
22-12-2013 Bonus Bonus 1500000
- 30-12-2013 N/A Transmission 435208 10.00 4352080.00
30-12-2013 N/A Transmission 382396 10.00 3823960.00
28-12-2017 Gift Transferred. 1310000 10.00 13100000.00
Mohd. Asrar Hossain, Director
27-11-2011 Cash Placement 500000 10.00 5000000.00 -
9097619 5.42 4.71 Own
30-09-2012 N/A Transmission 12000000 10.00 120000000.00
05-12-2013 Cash Transferred. 10.00 7079985
22-12-2013 Bonus Bonus 1512000 10.00 15120000.00
-
30-12-2013 N/A Transmission 52812 10.00 528120.00
30-12-2013 N/A Transmission 764792 10.00 7647920.00
29-09-2015 N/A Transmission 50000 10.00 500000.00
28-12-2017 Gift Transferred. 1310000 10.00 13100000.00
Independent Director
N/A
Independent Director
N/A
(e) Detail of shares issued by the company at a price lower than the issue price
The Company has not issued any share at a price lower than the issue price.
106
Issued, Subscribed and Paid up capital
At present The Company has BDT 1,680,000,000 divided by 168,000,000 ordinary shares of face value of Tk. 10 each. The
detail capital structure is given below:
Authorized Capital 300,000,000 shares @ Tk. 10 each 3,000,000,000
Issued, Subscribed and Paid up Capital of 168,000,000 Ordinary Shares @ Tk. 10 each in full in cash and other than cash
Allotments for Cash Consideration
At the time of incorporation as on August 01, 2002 500,000
Issued as on April 14, 2005 20,000,000
Issued as on March 22, 2010 9,500,000
Issued as on March 29, 2010 70,000,000
Issued as on November 24, 2011 89,000,000
Issued as on November 27, 2011 36,500,000
Issued as on January 02, 2012 474,500,000
Sub Total (A) 700,000,000
Allotments Other Than Cash
Bonus Share Issue on November 20, 2011 800,000,000
Bonus Share Issue on December 22, 2013 180,000,000
Sub Total (B) 980,000,000
Grand Total C=(A+B) 1,680,000,000
The Company has subdivided the face value of its ordinary share from BDT 100.00 to BDT 10.00 by passing a special resolution in its Extraordinary General Meeting held on 21th October, 2010. Thus, paid-up capital of the Company comes to BDT 1,680,000,000/- (Taka One hundred sixty-eight crores only) divided into 168,000,000/- nos. ordinary shares of BDT 10.00 each.
(f) History of significant (5% or more) changes in ownership of securities from inception.
Sl. Date of transfer
Transferor Transferee
Name Balance before transfer (Qty.)
Transfer Qty. Balance after transfer (Qty.)
Name Balance before receive (Qty.)
Receive Qty. Balance after receive (Qty.)
01 05-12-2013 Mohd. Rezaul Karim 12500000 7079986 6920014 Mr. Abdus Salam 2000000 7079986 9079986
02 05-12-2013 Mr. Jan e Alam 12500000 7079986 6920014 Mr. Abdus Salam 9079986 7079986 16159972
03 05-12-2013 Md. Zakaria Alam 12500000 7079986 6920014 Mr. Abdus Salam 16159972 7079986 23239958
04 05-12-2013 Mr. Sydul Karim 12500000 7079986 6920014 Mr. Abdus Salam 23239958 7079986 30319944
05 05-12-2013 Mohd. Asfak Hossain 12600000 7079986 6920014 Mr. Abdus Salam 30319944 7079986 37399930
06 05-12-2013 Mohd. Asrar Hossain 12600000 7079985 6920014 Mr. Abdus Salam 37399930 7079985 44479915
07 05-12-2013 Mohd. Abrar Hossain 12600000 7079985 6920014 Mr. Abdus Salam 44479915 7079985 51559900
08 05-12-2013 Friends Corporation 10000000 10000000 - Mr. Abdus Salam 51559900 10000000 61559900
09 05-12-2013 Real Biz 440100 440100 - Mr. Abdus Salam 61559900 440100 62000000
10 05-12-2013 Amara Corporation 10000000 10000000 - Mr. Abdus Salam 62000000 10000000 72000000
11 02-03-2015 Abdus Salam 72240000 15120000 57120000 Mir Mohammad Hossain - 15120000 15120000
12 02-03-2015 Abdus Salam 57120000 15120000 42000000 Mir Mohammad Nasir - 15120000 15120000
13 02-03-2015 Abdus Salam 42000000 15120000 26880000 Mir Mohammad Hassan - 15120000 15120000 Note: Mr. Mohd. Jan e Alam and Mr. Mohd. Zakaria Alam transferred their 3,275,000 numbers of share respectively to Mr. Sydul Karim, Chairman, Mr. Mohd. Rezaul Karim, Managing
Director, Mr. Mohd. Asfak Hossain, Director, Mr. Mohd. Abrar Hossain, Director, Mr. Mohd. Asrar Hossain, Director in equal proportion in December 28, 2017, which was duly certified by
the RJSC.
107
CHAPTER – XIV CORPORATE GOVERNANCE
108
(a) A disclosure to the effect that the issuer has complied with the requirements of Corporate Governance Guidelines of the Commission
Management declaration regarding compliance with the requirements of Corporate Governance Guidelines of the Bangladesh Securities and Exchange Commission (BSEC) We would like to declare that we have complied with all the requirements of the applicable regulations of Corporate Governance Guidelines of Bangladesh Securities and Exchange Commission (BSEC) in respect of corporate governance including constitution of the Board and committees thereof. The corporate governance framework is based on an effective independent Board, separation of the Board’s supervisory role from the executive management team and constitution of the Board Committees, as required under applicable law.
Sd/- Mohd. Rezaul Karim
Director & Managing Director (b) A compliance report of Corporate Governance requirements certified by competent authority
Certificate on compliance of conditions of Corporate Governance Guidelines of Bangladesh Securities and Exchange Commission to the Shareholders of
Mohammed Elias Brothers POY Manufacturing Plant Ltd. We have examined the statement of Compliance of Corporate Governance Guidelines issued by Bangladesh Securities and Exchange Commission (BSEC) dated 7th August 2012 through Notification # SEC/CMRRCD/2006-158/134/Admin/44, as amended vide notification dated 21 July, 2013 and 18 August, 2013 of Bangladesh Securities and Exchange Commission (BSEC) on Corporate Governance appended to the Directors’ Report (as Annexure No. 1) of Mohammed Elias Brothers POY Manufacturing Plant Ltd. for the period from 1st July 2017 to 30 Sept 2017, as has been produced before us for our examination.
The Compliance of conditions of Corporate Governance Guidelines is the responsibility of the Company’s management. Our examination was limited to the procedures and implementation thereof, adopted by the Company for ensuring compliance of the conditions of Corporate Governance Guidelines. It is neither an audit nor an expression of an opinion on the financial statements of the Company.
In our opinion and to the best of our information and according to the explanations given to us, the Company has complied with conditions of the afore-stated Corporate Governance Guidelines of Bangladesh Securities & Exchange Commission.
We state that such compliance is neither as assurance as to the future viability of the Company nor the efficiency or efficacy with which the management has conducted the affairs of the Company.
Sd/-
For Basu Banerjee Nath & Co. Chartered Accountants
Signed by: Gobinda Chandra Paul, FCA, Partner Membership No. 282 of The Institute of Chartered
Accountants of Bangladesh
Dated: Chittagong-December 07, 2017
109
Annexure-1 STATUS OF COMPLIANCE REPORT ON CORPORATE GOVERNANCE:
COMPLIANCE REPORT ON BSEC'S NOTIFICATION
Mohammed Elias Brothers POY Manufacturing Plant Ltd. Status of compliance with the conditions of Corporate Governance Guidelines asset by Bangladesh Securities and Exchange Commission (BSEC) by the Notification no. SEC/CMRRCD/2006-158/134/Admin/44 dated August 07, 2012 and subsequently amended through their notification no.SEC/CMRRCD/2006-158/147/Admin/48 dated July 21, 2013 issued under section 2CC of The Securities and Exchange Ordinance,1969.
(Report under Condition No.7.00)
Condition No.
Title
Compliance Status
(Put √ in the appropriate column) Remarks (if any)
Complied Not
Complied
1.00 Board of Directors
1.1 Board’s Size:
The number of the Board members of the company shall not be less than 5 (five) and more than 15 (Fifteen).
√
The MEBPOY Ltd. Board is comprised of 7 Directors.
1.2 Independent Directors:
1.2(i) At least one fifth (1/5) of the total number of directors in the company’s board shall be in dependent directors.
√
There are two Independent Directors in the MEBPOY Ltd Board, namely Mr. Eradat Ullah, FCA and Mr. Md. Golam Moin Uddin Chowdhury, their appointment date as ID on 08.10.2017 and 03.12.2017 respectively.
1.2(ii)a) The independent director does not hold any share in the company or holds less than one percent (1%) shares of the total paid-up shares of the company;
√
1.2(ii)b)
The independent director is not a sponsor of the company and is not connected with the company’s any sponsor or director or shareholder who holds one percent (1%) or more shares of the total paid-up shares of the company on the basis of family relationship. His/her family members also should not hold above mentioned shares in the company: Provided that spouse, son, daughter, father, mother, brother, sister, son-in-law and daughter-in-law shall be considered as family members.
√
1.2(ii)c) The independent director does not have any other relationship, whether pecuniary or otherwise, with the company or its subsidiary / associated companies.
√
1.2(ii)d) The independent director is not a member, director or officer of any stock exchange.
√
1.2(ii)e) The independent director is not a shareholder, director or officer of any member of stock exchange or an intermediary of the capital market.
√
1.2(ii)f) The independent director is not a partner or an executive or was not a Partner or an executive during the preceding 3 (three) years of the concerned company’s statutory audit firm.
√
1.2(ii)g) The independent director shall not be an independent director in more than3 (three) listed companies.
√
1.2(ii)h) The independent director has not been convicted by a court of competent jurisdiction as a defaulter in payment of any loan to a bank or a Non-Bank Financial Institution (NBFI).
√
1.2(ii)i) The independent director has not been convicted for a criminal offence involving moral turpitude.
√
110
1.2(iii)
The independent director(s) shall be appointed by the board of
directors and approved by the shareholders in the Annual General
Meeting (AGM).
√
Mr. Eradat Ullah, FCA and Mr. Md. Golam Moin Uddin Chowdhury were appointed as independent Director by Board of Directors on 08-10-2017.and 03.12.2017 respectively. The appointment of Eradat Ullah, FCA was approved by the Shareholders in AGM on 19-10-2017. Though appointment of Mr. Md. Golam Moin Uddin Chowdhury was after the date of AGM 2017, this will approved on forthcoming AGM.
1.2(iv) The post of independent director(s) cannot remain vacant for more
than 90(ninety) days.
√
1.2(v) The Board shall lay down, a code of conduct of all Board members
and annual compliance of the code to be recorded.
√
1.2(vi) The tenure of office of an independent director shall be for a period
of 3 (three) years, which may be extended for 1(one) term only.
√
1.3 Qualification of Independent Director (ID):
1.3(i)
Independent director shall be a knowledgeable individual with
integrity who is able to ensure compliance with financials,
regulatory and corporate laws and can make meaningful
contribution to business.
√
1.3(ii)
The person should be a Business Leader/Corporate
Leader/Bureaucrat/University Teacher with Economics or
Business Studies or Law background / Professionals like Chartered
Accountants, Cost & Management Accountants and
Chartered Secretaries. The independent director must have a least
12 (twelve) years of corporate management /
professional experiences.
√
1.3(iii) In special cases the above qualifications may be relaxed subject to
prior approval of the Commission.
-
N/A
1.4 Chairman of the Board and Chief Executive Officer:
The positions of the Chairman of the Board and the Chief Executive
Officer of the companies shall be filled by different individuals. The
Chairman of the company shall be elected from among the directors
of the company. The Board of Directors shall clearly define
respective roles and responsibilities of the Chairman and the Chief
Executive Officer.
√
1.5 The Director’s Report to Shareholders
The directors of the companies shall include the following
additional statements in the Directors' Report prepared under
section 184 of the Companies Act, 1994 (Act No. XVIII of 1994):
1.5(i) Industry out look and possible future developments in the industry
√
1.5(ii) Segment-wise or product-wise performance - N/A
1.5(iii) Risks and concerns √
1.5(iv) A discussion on Cost of Goods sold, Gross Profit Margin and Net
Profit Margin.
√
1.5(v) Discussion on continuity of any Extra-Ordinary gain or loss. - N/A
1.5(vi) Basis for related party transactions-a statement of all related party
transactions should be disclosed in the Annual Report.
√
1.5(vii) Utilization of proceeds from public issues, rights issues and / or
through any others instruments.
-
N/A
1.5(viii) An explanation if the financial results deteriorate after the company
goes for Initial Public Offer (IPO), Repeat Public Offering (RPO).
Rights Offer, Direct Listing etc.
-
N/A
111
1.5(ix) If significant variance occurs between Quarterly Financial
Performance and Annual Financial Statements the
management shall explain about the variance on their Annual
Report.
-
N/A
1.5(x) Remuneration to directors including independent directors. √
1.5(xi) The financial statements prepared by the management of the issuer
company present fairly its state of affairs, the result of its operations,
cash flows and changes in equity.
√
1.5(xii) Proper books of accounts of the issuer company have been
maintained.
√
1.5(xiii) Appropriate accounting policies have been consistently applied in
preparation of the financial statements and that the accounting
estimates are based on reasonable and prudent judgment.
√
1.5(xiv) International Accounting Standards (IAS)/ Bangladesh
Accounting Standards (BAS)/ International Financial Reporting
Standard (IFRS) / Bangladesh Financial Reporting Standards
(BFRS), as applicable in Bangladesh, have been followed in
preparation of the financial statements and any departure there-
from has been adequately disclosed.
√
1.5(xv) The system of internal control is sound in design and has been
effectively implemented and monitored.
√
1.5(xvi) There are no significant doubts upon the issuer company’s ability
to continue as a going concern. If the issuer company is not
considered to be a going concern, the fact along with reasons thereof
should be disclosed.
√
1.5(xvii) Significant deviations from the last year’s operating results of the
issuer company shall be highlighted and the reasons there of should
be explained.
-
N/A
1.5(xviii) Key operating and financial data of at least preceding 5 (five) years
shall be summarized.
√
1.5(xix) If the issuer company has not declared dividend (cash or stock) for
the year ,the reasons thereof shall be given.
√
Due to business expansion dividend has not declared
1.5(xx) The number of Board meetings held during the year and attendance
by each director shall be disclosed.
√
1.5(xxi) The pattern of share holding shall be reported to disclosed the
aggregate number of shares (along with name wise details where
stated below):
1.5(xxi)a) Parent / Subsidiary/ Associated Companies and other related
parties (name wise details).
√
1.5(xxi)b) Directors, Chief Executive Officer, Company Secretary, Chief
Financial Officer, Head of Internal Audit and their spouses and
minor children (name wise details).
√
Directors hold shares of the Company
1.5(xxi)c) Executives. √
1.5(xxi)d) Shareholders holding ten percent (10%)or more voting interest in
the company (name wise details).
√
1.5(xxii) In case of appointment /re-appointment of a Director the
company shall disclose the following information to the
shareholders:
1.5(xxii)a) A brief resume of the director; √
112
1.5(xxii)b) Nature of his / her expertise in specific functional areas; √
1.5(xxii)c) Names of companies in which the person also holds the
directorship and the membership of committees of the board.
√
2.00 CHIEF FINANCIAL OFFICER (CFO), HEAD OF INTERNAL AUDIT AND COMPANY SECRETARY(CS)
2.1 Appointment
The company shall appoint a Chief Financial Officer (CFO), a Head
of Internal Audit (Internal control and Compliance) and a Company
Secretary (CS).The Board of Directors should clearly define
respective roles, responsibilities and duties of the CFO, the Head of
internal Audit and the CS.
√
The Company has appointed Mr. Md. Shahidullah Khan as Chief Financial Officer(CFO), and Mr. Eradat Ullah, FCA as Head of Internal Audit and Mohammad Mozaffor Ahmed as Company Secretary(CS).
2.2 Requirement to attend the Board Meetings:
The CFO and the Company Secretary of the companies shall attend
the meetings of the Board of Directors provided that the CFO and /
or the Company Secretary shall not attend such part of a meeting of
the Board of Directors which involves consideration of an agenda
item relating of their personal matters.
√
3.00 AUDIT COMMITTEE
3(i) The company shall have an Audit Committee as a sub-committee
of the Board of Directors.
√
3(ii) The Audit Committee shall assist the Board of Directors in ensuring
that the financial statements reflect true and fair view of the state of
affairs of the company and in ensuring a good monitoring system
with in the business.
√
3(iii) The Audit Committee shall be responsible to the Board of Directors.
The duties of the Audit Committee shall be clearly set forth in
writing.
√
3.1 Constitution of the Audit Committee:
3.1(i) The Audit Committee shall be composed of at least 3 (three)
members.
√
3.1(ii) The Board of Directors shall appoint members of the Audit
Committee who shall be directors of the company and shall include
at least 1(one) independent director.
√
3.1(iii) All members of the audit committee should be "financially literate”
and at least 1(one) member shall have accounting or related
financial management experience.
√
3.1(iv) When the term of service of the Committee members expires or
there is any circumstance causing any Committee member to be
unable to hold office until expiration of the term of service, thus
making the number of the Committee members to be lower than the
prescribed number of3 (three) persons, the Board of Directors shall
appoint the new Committee member(s) to fill up the vacancy (i.e.)
immediately or not later than 1(one) month from the date of
vacancy( i.e.) in the Committee to ensure continuity of the
performance of work of the Audit Committee.
-
N/A
3.1(v) The company secretary shall act as the secretary of the Committee. √
3.1(vi) The quorum of the Audit Committee meeting shall not constitute
without at least 1 (one) independent director.
√
3.2 Chairman of the Audit Committee:
3.2(i) The Board of Directors shall select 1(one) member of the Audit
Committee to be Chairman of the Audit Committee, who shall be
an independent director.
√
113
3.2(ii) Chairman of the Audit Committee shall remain present in the
Annual General Meeting (AGM).
√
3.3 Role of Audit Committee shall include the following:
3.3(i) Oversee the financial reporting process. √
3.3(ii) Monitor choice of accounting policies and principles. √
3.3(iii) Monitor Internal Control Risk management process. √
3.3(iv) Oversee hiring and performance of external auditors. √
3.3(v) Review along with the management ,the annual financial
statements before submission to the board for approval.
√
3.3(vi) Review along with the management, the quarterly and half yearly
financial statements before submission to the board for approval.
√
3.3(vii) Review the adequacy of internal audit function. √
3.3(viii) Review statement of significant related party transactions
submitted by the management.
√
3.3(ix) Review Management Letters / Letter of Internal Control weakness
issued by statutory auditors.
√
3.3(x) When money is raised through Initial Public Offer (IPO) / Repeat
Public Offering (RPO)/ Rights Issue the company shall disclose to
the Audit Committee about the uses/applications of funds by major
category (capital expenditure, sales and marketing expenses,
working capital, etc.), on a quarterly basis and annual basis.
√
3.4 Reporting to the Audit Committee:
3.4.1 Reporting to the Board of Directors:
3.4.1(i) The Audit Committee shall report on its activities to the Board of
Directors.
√
3.4.1(ii) The Audit Committee shall immediately report to the Board of
Directors on the followings, ifany:
-
N/A
3.4.1(ii)a) Report on conflicts of interests; - N/A
3.4.1(ii)b) Suspected or presumed fraud or irregularity or material defect in
the internal control system;
-
N/A
3.4.1(ii)c) Suspected infringement of laws, including securities related laws,
rules and regulations; and
-
N/A
3.4.1(ii)d) Any other matter which shall be disclosed to the Board of Directors
immediately
-
N/A
3.4.2 Reporting to the Authorities
If the Audit Committee has reported to the Board of Directors about
anything which has material impact on the financial condition and
results of operation and has discussed with the Board of Directors
and the management that any rectification is necessary and if the
Audit Committee finds that such rectification has been
unreasonably ignored, the Audit Committee shall report such
finding to the Commission, upon reporting of such matters to the
Board of Directors for three times or completion of the period of 6
(six) months from the date of first reporting to the Board of
Directors, whichever is earlier.
-
N/A
3.5 Reporting to the Share holders and General Investors
Report on activities carried out by the Audit Committee, including
any report made to the Board of Directors under condition 3.4.1(ii)
above during the year, shall be signed by the Chairman of the Audit
Committee and disclosed in the annual report of the issuer
company
√
114
4.0 EXTERNAL / STATUTORY AUDITORS 4(i) Non- engagement in Appraisal or valuation services or fairness
opinions
√
4(ii) Non-engagement in designing and implementation of Financial
Information System.
√
4(iii) Non-engagement Book-keeping or accounting √
4(iv) Non-engagement Broker-dealer services √
4(v) Non-engagement in Actuarial services √
4(vi) Non-engagement in Internal audit services √
4(vii) Non-engagement in any other service determined by the Audit
Committee
√
4(viii) No partner or employees of the external audit firms shall possess
any share of the company they audit at least during the tenure of
their audit assignment of that company.
√
4(ix) Audit / certification services on compliance of corporate
governance as required under clause (i) of condition No. 7.
√
5.00 SUBSIDIARY COMPANY: 5(i) Provisions relating to the composition of the Board of Directors of
the holding company shall be made applicable to the composition
of the Board of Directors of the subsidiary company.
-
N/A
5(ii) At least 1(one) independent director on the Board of Directors of the
holding company shall be a director on the Board of Directors of the
subsidiary company.
-
N/A
5(iii) The minutes of the Board meeting of the subsidiary company shall
be placed for review at the following Board meeting of the holding
company.
-
N/A
5(iv) The minutes of the respective Board meeting of the holding
company shall state that they have reviewed the affairs of the
subsidiary company also.
-
N/A
5(v) The Audit Committee of the holding company shall also review the
financial statements, in particular the investments made by the
subsidiary company.
-
N/A
6.00 DUTIES OF CHIEF EXECUTIVE OFFICER (CEO) AND CHIEF FINANCIAL OFFICER (CFO):
6(i) The CEO and CFO shall certify to the Board that they have reviewed
financial statements for the year and that to the best of their
knowledge and belief;
√
6(i)a) These statements do not contain any materially untrue statement or
omit any material factor contain statements that might be
misleading.
√
6(i)b) These statements together present a true and fair view of the
company’s affairs and are in compliance with existing accounting
standards and applicable laws.
√
6(ii) There are, to the best of knowledge and belief, no transactions
entered into by the company during the year which are fraudulent,
illegal or violation of the company’s code of conduct.
√
7.00 REPORTING AND COMPLIANCE OF CORPORATE GOVERNANCE: 7(i) The company shall obtain a certificate from a practicing
Professional Accountant /Secretary (Chartered Accountant / Cost
and Management Accountant / Chartered Secretary) regarding
compliance of conditions of Corporate Governance Guidelines of
the Commission and shall send the same to the shareholders along
with the Annual Report on a yearly basis.
√
7(ii) The directors of the company shall state, in accordance with the
Annexure attached, in the directors’ report whether the company
has complied with these conditions.
√
115
(c) Details relating to the issuer's audit committee and remuneration committee, including the names of committee members and a summary of the terms of reference under which the committees operate.
In accordance with the currently accepted Best Practice and Corporate Governance Guidelines adopted by Bangladesh Securities and Exchange Commission (BSEC), the Board appointed Audit Committee and remuneration committee comprises of the following:
Audit Committee Members Name
Sl. Name & Position
1 Mr. Eradat Ullah, FCA, Independent Director, Chairman of the committee
2 Mr. Mohd. Rezaul Karim, Managing Director
3 Mr. Mozaffor Ahmed, Co’s. Secretary
4 Mr. Asfak Hossain, Director
5 Mr. Abrar Hossain, Director *The company secretary shall act as the secretary of the Committee.
Remuneration Committee Members Name
Sl. No. Name & Position
1 Mr. Md. Golam Moin Uddin Chowdhury, Independent Director
2 Mr. Mohd. Rezaul Karim, Managing Director
3 Mr. Md. Shahidullah Khan, CFO
4 Mr. Mozaffor Ahmed, Co’s Secretary
*The company secretary shall act as the secretary of the Committee.
The terms of reference of the audit committee has been agreed upon as follows:
◊ To review all internal and external audit report.
◊ To recommend the statutory annual audited financial statements to the Board of Directors for approval.
◊ To review the finding of the internal and external auditors.
◊ To review and approve the Annual “Audit Plant” of the Internal Audit Department. ◊ To monitor the implementation of the recommendations of the Internal and External auditors. ◊ To review the performance of the external auditors and make recommendations to the Board regarding their appointment and
fees.
◊ To review the quarterly, half yearly and annual financial statements before submission to the Board, focusing particularly on.
◊ To review the company’s statement on internal control systems prior to endorsement by the Board.
◊ The company secretary shall be the secretary of the audit committee.
The terms of reference of the Remuneration committee has been agreed upon as follows:
◊ To assist the Board in developing and administering a fair and transparent procedure for setting policy on the remuneration of
directors and senior management of the Company.
◊ Determining the remuneration packages.
◊ Review the Annual Confidential Report (ACR) of senior management of the company.
◊ Review and oversee the Company's overall human resources strategy.
116
CHAPTER- XV VALUATION REPORT OF SECURITIES PREPARED BY THE ISSUE MANAGER
117
Valuation report of securities prepared by the Issue Managers (Rules - 5(B)(14), Annexure - E)
The valuation report of securities shall be prepared on the basis of the financial and all other information pertaining to the issue. The fair value is determine under different valuation methods referred in 5(B)(14) under clause no Annexure–E, of Bangladesh Securities and Exchange Commission (Public Issue) Rules, 2015. The following table illustrates the calculation of fair value of Mohammed Elias Brothers POY Manufacturing Plant Ltd. under different methods:
Summary of valuation
Sl. Method used BDT
Method-1 A) Net Asset Value (NAV) per share with revaluation 22.34
B) Net Asset Value (NAV) per share without revaluation 13.70
Method-2 Earnings based value per share 11.11
Method-3 Average market price of similar stock based valuation 8.34
Justification of the valuation of share price of Mohammed Elias Brothers POY Manufacturing Plant Ltd.
Qualitative factors Some of the qualitative factors that help differentiate Mohammed Elias Brothers POY Manufacturing Plant Ltd. from their competitors and enable them to compete successfully in the industry are as follows:
◊ Management: Management is highly experience and they are leading persons in their arena. ◊ Modern Machineries: MEBPOY has been using modern machineries that increase productivity. ◊ Market Share: The Market share of the company has been increasing rapidly. ◊ Quality of product: MEBPOY produce high quality product.
◊ Relationship with clients & suppliers: It has a very good relationship with its clients and suppliers Quantitative factors
Information presented in this prospectus is derived from audited financial statements for the period ended September 30, 2017, year ended 30 June 2017, period ended 30 June 2016, 31 December 2015, 2014, 2013, and 2012 as prepared in accordance with BAS and BFRS.
The share price valuation of the Company has been derived based on: ◊ Net Asset Value considering with revaluation and without revaluation, ◊ Earnings based valuation considering last five years weighted average EPS and lesser of last three months sector PE
and Market PE ◊ Average market price per share of similar stock for the last one year
Methods of valuation We have considered the following methods to determine the share price of Mohammed Elias Brothers POY Manufacturing Plant Ltd.:
Sl. Methods applied Sources of information Authenticity
1 Net Asset Value (NAV) per share at historical cost and current cost basis
Audited financial statements as on September 30, 2017
The information is given in the audited accounts has been authenticated by the Board of Directors and subsequently by the auditors
2 Earnings based value per share based on weighted average EPS of last five years
Audited financial statements for the period ended September 30, 2017, year ended 30 June 2017, period ended 30 June 2016, 31 December 2015, 2014, 2013, and 2012
3
Average market price per share of similar stock for the last one year immediately prior to the offer for common stocks with reference
DSE website (www.dsebd.org) The information disseminated in the website has been duly authenticated by the Management of DSE.
Method-1 A) Net Asset Value (NAV) per share with revaluation reserve
As per Audited financial statements September 30, 2017
Sl. Particulars Amount (Taka)
A. Share capital 1,680,000,000
B. Revaluation surplus 1,452,499,350
C. Retained earnings 620,822,604
D. Total shareholders' equity as 30 September 2017 (A+B+C) 3,753,321,954
E. Number of shares outstanding as on 30 September 2017 168,000,000
F. Net Asset Value (NAV) per share with revaluation reserve (D/E) 22.34
118
Method-1 B) Net Asset Value (NAV) per share without revaluation reserve
As per Audited financial statements September 30, 2017
Sl. Particulars Amount (Taka)
A. Share capital 1,680,000,000
B. Retained earnings 620,822,604
C. Total shareholders' equity as 30 September 2017 (A+B) 2,300,822,604
D. Number of shares outstanding as on 30 September 2017 168,000,000
F. Net Asset Value (NAV) per share without revaluation reserve (C/D) 13.70
Method-2 Earnings based value per share
Financial year No. of outstanding
shares Weight (%) Net Profit After Tax (Taka)
Weighted Net Profit After Tax (Taka)
2013 168,000,000 20% 141,942,321 28,388,464
2014 168,000,000 20% 130,554,800 26,110,960
2015 168,000,000 20% 96,026,536 19,205,307
2016 (6 months) 168,000,000 20% 32,896,232 6,579,246
2016-2017 168,000,000 20% 111,757,912 22,351,582
2017 (3 months) 168,000,000 20% 57,258,574 11,451,715
840,000,000 100%
a. Weighted Net Profit After Tax from 2013 to 2017 114,087,275
b. Number of shares as on September 30, 2017 168,000,000
c. Weighted average earnings per share (a/b) 0.68
d. Average sector PE for the last 3 months (Sep-17, Oct-17 and Nov-17) 17.35
e. Average market PE for the last 3 months (Sep-17, Oct-17 and Nov-17) 16.36
f. Earnings based value per share (Tk.) (c*e) [ Lower of sector PE and Market PE considered] 11.11
Source: Dhaka Stock Exchange Limited Monthly Review September 2017, October 2017 and November 2017.
Method-3 Average market price of similar stock based valuation
Sl. Name of Company Last One year Average Price from December 2016 to November 2017
EPS NAV
1 Beximco Synthetics Ltd. 8.34 -2.62 20.71
Reference: DSE website (www.dsebd.org)
Explanation for consideration of peer companies
Factors have been considered in determining the value of shares of MEBPOY:
1. The average market price of the peer companies during the last one-year Average Price from December 2016 to November 2017 is considered;
2. Last audited EPS of the peer companies have been considered from DSE website 3. The last five years weighted average EPS of MEBPOY is considered.
Conclusion:
From the above analysis we can stated that the fair value of Mohammed Elias Brothers POY Manufacturing Plant Limited under different method seems to be reasonable and fair. Considering all qualitative and quantitative factors along with industry and market, past track record of performance and future growth prospective of the issuer, we assume that the valuation of share price of Mohammed Elias Brothers POY Manufacturing Plant Limited is justified and shall be reasonable to the investors.
119
CHAPTER-XVI DEBT SECURITIES
120
Debt Securities
(a) The terms and conditions of any debt securities that the issuer company may have issued or is planning to issue within next six months, including their date of redemption or conversion, conversion or redemption features and sinking fund requirements, rate of interest payable, Yield to Maturity, encumbrance of any assets of the issuer against such securities and any other rights the holders of such securities may have;
The Company has not issued or is planning to issue any debt securities within six months
(b) All other material provisions giving or limiting the rights of holders of each class of debt securities outstanding or being offered, for example subordination provisions, limitations on the declaration of dividends, restrictions on the issuance of additional debt or maintenance of asset ratios;
The Company has not issued or is planning to issue any debt securities within six months
(c) Name of the trustee(s) designated by the indenture for each class of debt securities outstanding or being offered and describe the circumstances under which the trustee must act on behalf of the debt holders;
The Company has not issued or is planning to issue any debt securities within six months. Therefore, there are no such trustees for this issue
(d) Repayment or redemption or conversion status of such securities.
The Company has not issued or is planning to issue any debt securities within six months. Therefore, there are no such repayments or redemption or conversion status of such securities.
121
CHAPTER-XVII PARTIES INVOLVED AND THEIR RESPONSIBILITY
122
Parties involved and their responsibilities
Sl. Name of parties Key Responsibilities
1 Issue Managers
Prime Finance Capital Management Limited The Issue Managers will assist the Issuer in managing the proposed public issue of shares under purview of the Bangladesh Securities and Exchange Commission (Public Issue) Rules, 2015
AIBL Capital Management Limited
AB Investment Ltd.
2 Underwriters
1. Prime Finance Capital Management Limited 2. AIBL Capital Management Limited 3. AB Investment Limited 4. ICB Capital Management Limited 5. BetaOne Investments Limited 6. First Security Islami Capital and Investment
Limited 7. NBL Capital and Equity Management Limited 8. PLFS Investments Limited 9. Southeast Bank Capital Services Limited 10. Grameen Capital Management Limited 11. IIDFC Capital Limited 12. BMSL Investment Limited 13. MIDAS Investment Limited
The Underwriters shall act as the underwriters to the public issue as described in the Bangladesh Securities and Exchange Commission (Public Issue) Rules, 2015
3 Auditors Ahmed Zaker & Co. Chartered Accountants
To express an opinion on the financial statements based on their audit. Auditor will conduct the audit in accordance with Bangladesh Standards on Auditing and related laws and regulations.
4 Cost and Management Accountants
Not applicable for the Companies
5 Valuer Royal Inspection International Ltd.
The valuer responsibility is to conduct and prepare valuation report on the assets of the Company. In this regard the valuer inspected the issuer premises, measure the asset value and made relevant queries on it and assess the fair value of assets.
6 Credit Rating Company
Not applicable for the Companies
123
CHAPTER–XVIII MATERIAL CONTRACTS
124
(a) Major agreements entered into by the issuer
The following are material contracts have been entered into by the Company:
Issue Management agreement between the Company and 1. Prime Finance Capital Management Limited 2. AIBL Capital Management Limited 3. AB Investment Ltd.
Underwriting agreement between the Company and with the following underwriters: 1. Prime Finance Capital Management Limited 2. AIBL Capital Management Limited 3. AB Investment Limited 4. ICB Capital Management Limited 5. BetaOne Investments Limited 6. First Security Islami Capital and Investment Limited 7. NBL Capital and Equity Management Limited 8. PLFS Investments Limited 9. Southeast Bank Capital Services Limited 10. Grameen Capital Management Limited 11. IIDFC Capital Limited 12. BMSL Investment Limited 13. MIDAS Investment Limited
(b) Material parts of the agreements
Particulars Issue Management Agreement Underwriting Agreement
Signing date October 09, 2017 December 10, 2017 and January 3, 2018
Major terms and Condition
2.1.1 Regulatory Compliance
i. Filing of application of the PUBLIC ISSUE to the Bangladesh Securities and Exchange Commission (BSEC)
ii. Preparation of prospectus iii. Filing of prospectus to the BSEC, DSE and CSE. iv. Incorporation of modification suggested by the
BSEC, DSE and CSE. v. Obtaining approval from the BSEC within the
stipulated time vi. Preparation of all necessary papers and deeds for
submission to the BSEC for making the PUBLIC ISSUE effective
vii. Filing of the BSEC approved prospectus with the Registrar of Joint Stock Companies and Firms (RJSC).
2.1.2 Underwriting i. Preparation of COMPANY brief for the
Underwriters ii. Documentation/preparation of underwriting
agreement etc.
2.1.3 Subscription i. Selection of Banker to the Issue in consultation with
the ISSUER
ii. Supervising the distribution of prospectus and application forms to Bankers to the Issue, members of the DSE and the CSE and merchant banks.
2.1.4 Listing Filing of application for listing with Dhaka Stock Exchange Ltd. (DSE) and Chittagong Stock Exchange Ltd. (CSE).
4. COVENANTS OF THE ISSUE MANAGER Without prejudice to other stipulations relative to the responsibility of the ISSUE MANAGER, it is responsible towards the COMPANY for strict
2. 05. If and to the extent that the shares are offered to the
public by a prospectus authorized hereunder shall not have
been subscribed and paid for in cash in full by the Closing
Date of subscription, the Company shall within 10 (Ten)
days of the closure of subscription call upon the
underwriter in writing with a copy of the said writing to
the Bangladesh Securities and Exchange Commission, to
subscribe the shares not subscribed by the closing date and
to pay for in cash in full, inclusive of any premium if
applicable, for such unsubscribed shares within 15
(Fifteen) days after being called upon to do so. If payment
is made by Cheque/Bank Draft by the underwriter it will
be deemed that the underwriter has not fulfilled his
obligation towards his underwriting commitment under
this Agreement, until such time as the Cheque/Bank Draft
has been encashed and the Company’s account credited. In
any case within 7 (seven) days after the expiry of the
aforesaid 15 (fifteen) days, the Company shall send proof
of subscription and payment by the underwriter to the
Commission.
In the case of failure by the underwriter to pay for the
shares under the terms mentioned above, the said
underwriter will not be eligible to underwrite any issue,
until such time as it fulfils its underwriting commitment
under this Agreement and also other penalties as may be
determined by the Commission.
In the case of failure by the underwriter to pay for the
shares within the stipulated time, the Company/Issuer will
be under no obligation to pay any underwriting
commission under this Agreement.
In the case of failure by the Company to call upon the
underwriter for the aforementioned purpose within the
stipulated time, the Company and its Directors shall
individually and collectively be held responsible for the
consequences and/or penalties as determined by the
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compliance of this Agreement and to comply with all terms therein.
4.1. COVENANTS OF MUTUALLY AGREED TERMS: The issuer can appoint CO-ISSUE MANAGERS at any time and can enter into such agreement with any other merchant bank(s)/companies, which will be duly endorsed by the ISSUE MANAGERS.
8. COMPLIANCE The ISSUE MANAGERS shall ensure compliance of the Securities and Exchange Commission (Public Issue) Rules, 2006, Listing Rules of the Stock Exchanges, Companies Act, 1994, Securities and Exchange Ordinance, 1969 and other relevant rules, regulations, practices, directives, guidelines, etc.
The ISSUE MANAGERS shall issue a Due Diligence Certificate to execute the IPO as per Securities and Exchange Commission (Public Issue) Rules, 2006.
Bangladesh Securities and Exchange Commission under
the law.
2. 07. The liability of the underwriter under this clause shall
be in proportion to but not exceeding the shares agreed to
be underwritten by it; provided that the aforementioned
request of the Company shall be supported by official
certificates and other documents of subscription obtained
from the Bankers to the Issue and a declaration of the
Company as to the final result of the Public subscription.
2. 08. The Company shall pay to the underwriter an
underwriting commission at the rate of 0.50% of the value
of the amount of shares hereby agreed to be underwritten
by it.
4. 07. The underwriter warrants and represents that it has
certificate of registration from the Bangladesh Securities
and Exchange Commission to fully underwrite or place
primary securities in a firm commitment basis.
Signed by Managing Director /Chief Executive Officer of Mohammed Elias Brothers POY Manufacturing Plant Limited(Issuer) and Prime Finance Capital Management Limited, AIBL Capital Management Limited and AB Investment Ltd. (Issue Managers)
Managing Director /Chief Executive Officer of Mohammed Elias Brothers POY Manufacturing Plant Limited (Issuer) and respective Underwriters
(c) Fees payable to different parties
Manager to the issue fee
Sl. Name of Issue Managers Amount in BDT
01 Prime Finance Capital Management Limited 1,500,000
02 AIBL Capital Management Limited 100,000
03 AB Investment Ltd. 100,000
Underwriting Commission
Underwriters commission at the rate of 0.5% on 35% of the total IPO amount i.e., Tk. 87,500,000.
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CHAPTER – XIX OUTSTANDING LITIGATIONS, FINE OR PENALTY
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(a) The following litigations including outstanding litigations against the issuer or any of its directors and fine or penalty imposed by any authority. The Issuer or Director or of Mohammed Elias Brothers POY Manufacturing Plant Limited was not involved in any of the following types of legal proceedings are mentioned below:
(i) Litigation involving Civil Laws; There is no conviction of the issuer or director (s) in a civil proceeding
(ii) Litigation involving Criminal Laws; There is no conviction of the issuer or director (s) in a criminal proceeding
(iii) Litigation involving Securities, Finance and Economic Laws;
There is no order, Judgement or decree of any court of competent jurisdiction against the issuer or director(s) permanently or temporarily enjoying, barring , suspending or otherwise limiting the involvement of any director(s) or officer in any type of securities , Finance and Economic Laws
(iv) Litigation involving Labor Laws; There is no conviction of the issuer or director (s) in connection to applicable labor Laws
(v) Litigation involving Taxation (Income tax, VAT, Customs Duty and any other taxes/duties);
There is no conviction of the issuer or director (s) in connection to Taxation (Income tax, VAT, Customs Duty and any other taxes/duties)
(vi) Litigation involving any other Laws. There is no Litigation involving any other Laws
(b) Cases including outstanding litigations filed by the Company or any of its directors:
There are no outstanding cases filed by the Company or any of its directors to any of the following types of legal proceedings mentioned below:
(i) Litigation involving Civil Laws; No cases filed by the Company or any of its Directors
(ii) Litigation involving Criminal Laws; No cases filed by the Company or any of its Directors
(iii) Litigation involving Securities, Finance and Economic Laws;
No cases filed by the Company or any of its Directors
(iv) Litigation involving Labor Laws; No cases filed by the Company or any of its Directors
(v) Litigation involving Taxation (Income tax, VAT, Customs Duty and any other taxes/duties);
No cases filed by the Company or any of its Directors
(vi) Litigation involving any other Laws. No cases filed by the Company or any of its Directors
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CHAPTER – XX RISK FACTORS AND MANAGEMENT’S PERCEPTIONS ABOUT THE RISKS
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RISK FACTOR
Investment in equity shares is fraught with various levels of risk. Consequently, the return of the investment is dependent on the functioning of the risk factors. Mohammed Elias Brothers POY Manufacturing Plant Limited operates in an industry, which exposed to a number of internal and external risk factors over which the Company has little or no control. The occurrence of the risk factors as delineated hereunder, and if the management fails to avoid or mitigate those, can have significant bearing on the operational and financial performance of the Company, which, in turn, may negatively affect the value of share of the Company. Therefore, it is imperative to understand the risk profile of the Company along with management’s perception of the risks for taking an informed investment decision.
(i) Internal risk factors may include, among others:
(a) Credit Risk
Credit risk is the risk of a financial loss to the Company if a client or counterparty to a financial instrument fails to meet its contractual obligations, and arises principally from the company's receivables. Credit risk information helps users of financial statements to assess the credit quality of the entity’s financial assets and level & sources of impairment loss.
Management Perception
Management has a credit policy in place and exposure to credit risk is monitored on an ongoing basis. To mitigate the credit risk the management of the company follows robust credit control and collections policies. The company has dedicated credit collections team.
(b) Liquidity Risk
The risk that a company may be unable to meet short term financial demands. This usually occurs due to the inability to convert its current assets to cash without a loss of capital or income. Liquidity is a common phenomenon of the business.
Management Perception
Mohammed Elias Brothers POY Manufacturing Plant Limited has been dealing with its working capital in efficient way to maintain liquidity risk. Management is dealing with accounts payable, inventory and accounts receivable efficiently.
(c) Risk associated with the issuer’s interest in subsidiaries, joint ventures and associates
Return of investment of the holding company may be eroded due to conflict of interest among the group or any significant financial loss of the subsidiary and associates company.
Management perception
Since the company has no subsidiaries, joint ventures and associates concern. So there are no such possibilities of arisen risk in this respect.
(d) Significant revenue generated from limited number of customers, losing any one or more of which would have a material adverse effect on the issuer
The revenue of the Company exposed to hindrance due to significant portion of revenue generated from concentrated customer.
Management perception
The Company is not dependent any single customer. A large number of customers are regularly buying its product. Therefore, if one customer cancels its order it shall have insignificant impact on its total revenue.
(e) Dependency on a single or few suppliers of raw materials, failure of which may affect production adversely
Interruption in raw material supply may impediment of smooth production process.
Management perception
The company has large number of supplier. It is not dependent on single supplier for sourcing raw materials.
(f) More than 20% revenue of the issuer comes from sister concern, associate, or subsidiary
Having 20% revenue generation from sister concern or associate or subsidiary makes issuer dependent on others companies. Hence, there is dependency risk.
Management perception
We do not have sister concerns, associate or subsidiary.
(g) Negative earnings, negative cash flows from operating activities, declining turnover or profitability, during last five years, if any;
Any negative earnings, negative cash flows from operating activities, declining turnover or profitability prevails, then financial conditions may be weakening accordingly.
Management perception
The Company has positive record of accomplishment of earnings and cash flow from operation, no declining history of turnover and profitability last five years and expects to hold this position in upcoming years.
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(h) Loss making associate or subsidiary or group companies of the issuer
The Company may be exposed to risk of contagion, which refers that the financial problem, especially insolvency, of one member of a group will bring about deterioration in the condition of all members.
Management perception
The Company has no associate /subsidiary company which are loss making. Therefore, no risk shall be arising in this respect.
(i) Financial weakness and poor performance of the issuer or any of its subsidiary or associates
Financial performances have material impact on the sustainability of the Company as going concern.
Management perception
The Company has a proven record of accomplishment of its strong financial fundamentals. The Company has planning to expansion of its business, which will strengthen its revenue base in future.
(j) Decline in value of any investment
Investment value might rise or fall because of market conditions (market risk). Corporate decision, such as whether to expand into a new area of business or merge with another company, can affect the value of investment
Management perception
All investment carries some degree of risk. By better understanding, the nature of risk and taking steps to manage those risks an organization it could be able to hedge this risk. The Company has significant investment portfolio in its own resources. The level of risk associated with a particular investment or asset class correlates with the level of return the investment might achieve, the rationale behind this relationship is that investors willing to take on risky investments and potentially lose money should be rewarded for their risk. The analysis shown that return on investment (ROI) was always positive. The investment value was never decline.
(k) Risk associated with useful economic life of plant and machinery, if purchased in second hand or reconditioned
The Company shall not be able to operate its business longer period due to limited life of plant and machinery
Management perception
The Company purchase all brand new machineries 100% German which economic life is pre disclosed by the vendors. Therefore, it is not applicable for us.
(l) Adverse effect on future cash flow if interest free loan given to related party or such loans taken from directors may recalled
There are possibilities of a holding company to expand with debt or leverage, building an intricate corporate structure which can include unrealized values, thus creating a risk if interest rates on obligations or the evaluation of assets posted as guarantee for loans alter radically
Management perception
No unsettled receipt and payment in case of related party transaction. No director was given to or taken from loan from the Company. So no risk shall arise or possibilities to be arisen in future.
(m) Potential conflict of interest, if the sponsors or directors of the issuer are involved with one or more ventures which are in the same line of activity or business as that of the issuer and if any supplier of raw materials or major customer is related to the same sponsors or directors
Conflict of interest between the Issuer and its suppliers or major customer arise due to common management may create impediment in the day to day business operational process
Management perception
No sponsor or director hold any position or own any stake in the business of its supplier or customer. Therefore, no conflict would be arisen in this respect.
(n) Related party transactions entered into by the company those may adversely affect competitive edge
Related party transaction of the issuer creates conflict of interest which reduces the competitive advantage of the issuer.
Management perception
The Company provides adequate disclosures in the audited financial statements, which is sufficient about its related party transaction. The above disclosures are presented in true and fair view of the company’s transaction with the related party. So there are no such possibilities of arise of conflict in this respect.
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(o) Any restrictive covenants in any shareholders' agreement, sponsors' agreement or any agreement for debt or preference shares or any restrictive covenants of banks in respect of the loan or credit limit and other banking facilities;
The future business process or revenue may hinder by any such restrictive covenants stipulated in the agreements with shareholders, with sponsor or any loan agreement with the bank or financial institutes.
Management perception
There are no such restrictive covenants persist with any shareholders, sponsor or any bank loan facility.
(p) Business operations may be adversely affected by strikes, work stoppages or increase in wage demands by employees;
The industry is operating mutually by workers and management mutual understanding. Owners are always concern about the workers demand. Sometimes workers demanded more salary and stopped works, which also create financial loss to the Company.
Management perception
Employee unrest is part of business and it is important to deal with labor unrest efficiently. MEBPOY is operating mostly automatic and it has also different incentive packages for their employees so that they can be beneficial to such package. Because management believe that employees are very important part of the business.
(q) Seasonality of the business of the issuer
Revenue of the Company would be affected if the business is seasonal.
Management perception
The business of the Company does not depend on any season, as demand for POY is remain throughout the year. Therefore, the Company’s revenue is not affected by any seasonal factor.
(r) Expiry of any revenue generating contract that may adversely affect the business;
The revenue would be squeezed if any contract for which revenue generated had expired.
Management perception
There is no such contract for which the future revenue would be squeeze.
(s) Excessive dependence on debt financing which may adversely affect the cash flow
The Company would be exposed to high degree of risk due to excessive dependence on debt financing. It has possibilities that future cash flow from operation shall be squeezed due to increase financial expense.
Management perception
No excessive dependency on debt financing due to net worth is positive. Again the operating cash flow was positive last 5 years which indicates that the Company’ s cash generation capacity from operating activities is sufficient. The expansion project shall also generate sufficient profit. The Management of MEBPOY is expects that they would be able to payment bank liabilities from out of business profit.
(t) Excessive dependence on any key management personnel absence of whom may have adverse effect on the issuer’s business performance
Key management personnel have key role in the organization for smooth operation of the company. If key management personnel turnover is high that’s have adverse impact on the organizational day-to-day activities.
Management perception
Since inception of the Company, the employee rotation rate is low. The organizational structure is design in such a way that any key management person if not in job that’s shall have no impact on Company’s overall performance.
(u) Enforcement of contingent liabilities, which may adversely affect financial condition
Contingent liabilities are likely to have a negative impact on a company's stock share price because they threaten to reduce the company's assets and net profitability. The extent of the impact on share price depends on the estimated probability of the contingent liabilities becoming actual liabilities.
Management perception
MEBPOY has a contingent liability disclosed in the financial statements on the ground that the liabilities under guarantees and immature letters of credit not acknowledged as debt of the Company. If for any reasons, which has remote possibility, the decision goes against the Company (partly or fully), necessary provision would be made as per para 30 of BAS 37 and the Company has the financial strength to pay the liability out of cash from operating activities.
(v) Insurance coverage not adequately protect against certain risks of damages
The Company would be exposed to significant loss if there is no insurance coverage on its assets.
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Management perception
The Company has been diversified the risk of damage of its assets by taking insurance policies. All fixed assets of the Company are under insurance coverage. Again, the Company handles its import through Letter of credit, which is also under insurance coverage. The disclosure regarding insurance premium has been given in note 21.03 in audited financial statements as on 30 Sept. 2017.
(w) Absence of assurance that directors will continue its engagement with Company after expiry of lock in period;
The Company may expose to certain risk to operate its day-to-day business operations if current directors’ engagement shall not continue after expiry of lock in period.
Management perception
As the directors of the Company is owner so there is reasonable guarantee that they will continue after the lock in period
(x) Ability to pay any dividends in future will depend upon future earnings, financial condition, cash flows, working capital requirements and capital expenditure
Any future dividend payment depends on the future revenue generation. Any negative earnings in future shall be hindered future financial stability of the company.
Management perception
From existing business, the Company shall earn significant revenue from which possible to pay dividend regularly. As per feasibility report, the Company shall earn significant revenue from its expansion business. It is presuming that the Company shall be able to pay dividend from the excess earning which shall be gathered from the expansion unit.
(y) History of non-operation, if any and short operational history of the issuer and lack of adequate background and experience of the sponsors
For any instance of non-operation, production of the company will be hampered. This would also increase the costing and affect its profitability. Above all, the management will not be able deliver the products within the deadlines set by the buyers. However, there is no history of non-operation in the case of the company.
Management perception
The Company is in commercial operation since 1st January 2007 and it has no history of non-operation till now. The Company has an independent body that is operated by its Memorandum & Articles of Association and other applicable laws Implemented by the Government. Besides, the Company’s financial strength is satisfactory. It has very experienced Directors and Management team to make the Company more efficient and stronger. So, the chance of becoming non-operative for the Company is minimal.
(z) Risks related to engagement in new type of business, if any
Every business has some inherent risk such as market risk, financial risk and risk of new entrants with its competitors. If industry trends are moving away from the firm’s product or service or if competitors already lock up potential customers, it will be difficult to gain customer momentum. Market can affect new business depending on nature and location of the business, prospective competitions and product pricing. Markets that are overly saturated with the same products and service can be detrimental to a new business ability to gain significant market share. On the other hand, new business faces significant financial risk due to achieve the target as projected in the financial projection and lack of working capital. If the business does not succeed, a new business owner could possibly face financial ruin.
Management perception
The Company has a long track record of business. Within this time horizon, the Company has taken several strategic decisions such as business diversification, product promotion and discovering new market opportunity. After completion of its successful startup, the Company has now been reached in matured stage. After passed a successful decade of business operation, the sponsors have been set up new dream as well as broaden their views and fixing a spotlight to cater the greater market demand and strengthen in the industry by holding more market share to remain in the competitive business environment in local and global arena. In this context, the sponsor has taken strategic decision to expansion its existing business as they have long experience regarding its nature, business challenges, strategies and its market and future global demand and potentiality. Therefore, the sponsors are confident to operate expansion project as they have already gain experience in POY production and marketing. Though the expansion project shall increase the business size, increase operation activities and may have challenges in each and every phases of its implementation, the sponsors and management are confident enough to face any challenges to make the dream comes true to introduce of new horizon of business. The Management of the Company believes that to remain in the global business, it is a high time to expansion of its current business capacity though there are many obstacles may hinder its successful implementations. The Management is confident that if any risk arises that shall be mitigated as usual manner.
(aa) Risk in investing the securities being offered with comparison to other available investment options
The Company would be exposed off potential financial distress if return on invest is low compare to alternative investment options they have.
Management perception
No other investment option that the Company has been considered except the project as describes under the head “Use of proceeds” in the prospectus.
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(bb) Any penalty or action taken by any regulatory authorities for non-compliance with provisions of any law
The Company shall have risk to expose of eroded its brand name and goodwill in case of penalty or action taken by the regulatory authority.
Management perception
The Company yet to be exposed of any such penalty from its inception. Therefore, the management of the Company alleged that there is little scope of arising such risk in near future. The Management of MEBPOY is always concern about compliance status for the regulatory requirements.
(cc) Litigations against the issuer for Tax and VAT related matters and other government claims, along with the disclosures of amount, period for which such demands or claims are outstanding, financial implications and the status of the case
Any litigation in terms of unsettled tax, VAT or any other Govt. claim may hamper business operation of The Company as well as may create future potential financial losses.
Management perception
MEBPOY has a contingent liability disclosed in the financial statements on the ground that the liabilities under guarantees and immature letters of credit not acknowledged as debt of the Company. If for any reasons, which has remote possibility, the decision goes against the Company (partly or fully), necessary provision would be made as per para 30 of BAS 37 and the Company has the financial strength to pay the liability out of cash from operating activities. (dd) Registered office or factory building or place of operation is not owned by the issuer
If office and factory location is not own by the Company business operation may hamper.
Management perception
Except the Registered office, factory building and the place of operation is under ownership of the Company. Therefore, there have no scope of arising any risk in this respect.
(ee) Lack of renewal of existing regulatory permissions/licenses
Non-renewal of license may hamper day-to-day business operation of the Company.
Management perception
All licenses are valid and up dated. The management of the company is always taken timely steps to renewal of all its regulatory licenses. Therefore, scope of arising any risk in this respect is low.
(ff) Failure in holding AGM or declaring dividend or payment of interest by any listed securities of the issuer or any of its subsidiaries or associates
Failure in holding AGM or declaring dividend indicates the lack of compliance to the regulatory rules. Failure of payment of interest indicate the poor cash generation to the company to pay interest and debt service. The overall impression will be negative for the company.
Management Perception
We do not have any listed securities and we do not have any subsidiary or associates.
(gg) Issuances of securities at lower than the IPO offer price within one year
If the Issuer was issued share at lower than the IPO offer price within one year, there have possibilities to arise misperception about IPO price.
Management perception
The Company does not issue any securities at lower than the IPO offer price within one year.
(hh) Refusal of application for public issue of any securities of the issuer or any of its subsidiaries or associates at any time by the Commission
Any refusal of application for public issue of any securities of the issuer may hinder confidence of the Company or convey negative impression about the financial status to the shareholders.
Management perception
The Company applied in past any such application to Bangladesh Securities and Exchange Commission of capital raising through IPO. So such refusal of securities was occurred due to change the Public Issue Rules 2015.
(ii) External risk factors may include among others:
Investment in capital market involves exposure to several types of risks. Mohammed Elias Brothers POY Manufacturing Plant Limited operates in an industry that is exposed to several external risk factors over which the Company has little or no control. The following includes some of the significant risk factors that may affect the value of the Company’s shares. Hence, a rational investor should carefully consider all the information contained in this prospectus including the risk factors elaborated below.
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(a) Interest rate risks;
Interest/financial charges are paid against any kind of borrowed fund. Volatility in money market and increased demand for loan presses interest rate structure to be fixed at high. Raising of interest rate increases the cost of fund for a company, which has borrowed fund, and consequently profit is squeezed.
Management perception
The management of the Company is always aware of interest rate, which is connected to the cost of fund of the Company. The Management prefers procuring the long-term fund with minimum fixed interest rate and the short-term fund with reasonable competitive rate. On the other hand, management of the Company is emphasizing on equity-based financing.
(b) Exchange rate risks;
Exchange rate risk arises due to changes in exchange rate. As the Company imports raw materials and spare parts from abroad, unfavorable volatility or currency fluctuation may affect the profitability of the Company. When exchange rate increased against local currency, the chance of generating more profit is decreased as the Company only imports raw materials and sells finished product locally. On the other hand, if exchange rate goes down margin is stretched in local currency. Currently, Bangladesh Bank follows a managed floating exchange rate policy and therefore, the Taka/USD rates have remained within a tight band. However, as demand for the dollar grows with increased economic well-being and global competitiveness of the nation’s assets, exchange rate volatility is expected.
Management perception
The products of the company are sold against local currency but payments for raw materials are made in foreign currency. But the Company has the privilege to increase the price of the finished product i.e. DTY as and when the cost of procuring raw materials gets increased. Moreover, to minimize the impact of volatility of exchange rate on the profitability of the Company, the Company sometime purchases raw materials through forward agreement.
(c) Industry risks;
Industry risk refers to the risk of increased competition from foreign and domestic sources leading to lower prices, revenues, profit margins, market share etc. which could have an adverse impact on the business, financial condition and results of operation. POY industry in Bangladesh has a vast local demand. Imported POY now plays a significant role in this sector to set up the prices.
Management perception
MEBPOY is known in the market as innovative technology driven capital intensive company, it has a track record to upkeep with technology investment which has given them the tag of trend setters. Also due to its superior quality and competitive pricing, MEBPOY has been able to capture a dominant position in the market. The company is continuously working on product development through research and development (R&D). The management is confident that the new entrants will not be a considerable threat for the company as they are being the market leader with the best quality product, operational efficiency, organized marketing and distribution network.
(d) Economic and political risks
Economic risk
Economic risk arises due to some various factors such as political or regulatory policy change, including adverse impact of globalization, social disturbances due to political unrest, terrorist attacks and other acts of violence or war, natural calamities, commodity and hike commodity & energy prices and various other factors. Any significant change may adversely effect on business and profitability of the Company.
Management perception:
Bangladesh economy is booming for last few years. Consistent industrial growth along with increased agricultural production has made the per capita income higher than that of recent years. In addition, favorable government policies and industry friendly policies by other regulatory bodies have proved to be congenial to the economy of the country. Bangladesh has been considered to be next emerging country in terms of economic development. This indicates the future potentiality of our country’s economic strength. Despite of some economic shortfall, Bangladesh economy is going to be stands on a strong platform in terms of micro and macro economy indicators such as inflation, exchange rate, foreign reserve, GDP growth, per capital income, domestic demand, Labor rate etc. Management of MEBPOY is perceives that this is the right time to confine the economic benefit through expansion of business.
Political risk
The risk that an investment returns could suffer as a result of political changes or instability in a country. Instability affecting investment returns could stem from a change in government, legislative bodies, other foreign policy makers, or military control
Management perception
The management of the Company believes that more effective management of political risk shall help the companies in protection of their investments and shall improve the performance of business operation. Management perceives that, this requires more integration of political risk management into a systematic process as well as shall have to be embedded in a company’s other business processes. The management
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of the Company is fully aware of the potential risk related with political outcome and accordingly they have taken several safe guards to prevent the financial loss of the company. In this regard, the Group has been taken adequate insurance policy for its all fixed and floating assets to mitigate the political risk.
(e) Market and technology-related risks
Technology always plays a vital role for each and every type of business. Better technology can increase productivity and reduce costs of production. Firms are exposed to technology risks when there are better technologies available in the market than the one used by the company which may cause technological obsolescence and negative operational efficiency.
Management Perception
The company is aware of technological changes and has adopted new technology according to its needs. Furthermore, routine and proper maintenance of the equipment carried out by the company ensures longer service life for the existing equipment and facilities.
f) Potential or existing government regulations: The company operates under Companies Act 1994, Customs Act 1969, and Labor Law 2006, Income Tax Ordinance 1984, Income Tax Rules 1984, Value Added Tax (VAT) Act 1991, Value Added Tax (VAT) Rules 1991 and other related regulations.
Any abrupt changes of the policies made by the regulatory authorities may adversely affect the business of the company.
Management Perception Since, the company operates in steel sector; the Government regulations are mostly investment-friendly. However, unless any policy change that may negatively and materially affect the industry as a whole, the business of the company is expected not to be affected. As it is an emerging sector, it is highly expected that the Government will not frustrate the growth of the industry with adverse policy measures.
g) Potential or existing changes in global or national policies: Changes in the existing global or national policies can have either positive or negative impacts for the company. Any scarcity or price hike of raw materials due to changes in policy in the international market might hamper the production and profitability. Furthermore, the performance of the company would also be hampered due to unavoidable circumstances both in Bangladesh and abroad like political turmoil. Since, the risk involved with the potential changes in global or national policies is a macro factor, it is beyond the capability of MEBPOY to control.
Management Perception
The management of MEBPOY is always concerned about the prevailing and upcoming future changes in the global or national policy and shall response appropriately and timely to safeguard its interest. The strong brand equity of the company in the local market and deep and profound knowledge of the sponsors will always endeavor to withstand the unexpected changes or any such potential threats. Nevertheless, political stability and a congenial business environment is definitely the best situation in which MEBPOY will achieve its maximum potential. Political turmoil and the disturbance are bad for the economy as a whole and also for the company. On the other hand, Government has special attention to the growth of the industry as it is related to infrastructure development of the country.
h) Statutory clearances and approvals those are yet to be received by the issuer; If any kind of statutory clearances and approvals those are yet to be received by the issuer.
Management Perception
The company has collected all the statutory clearance and approval to operate the business. The necessary update and renewal is a continuous process. Hence, there is a limited degree of such risk associated with the company.
i) Competitive condition of the business
MEBPOY is operating in a free market economy regime from its competitors.
Management Perception
Bangladesh is the prime source of cheapest labor in the world, earning comparative advantages for its industries over their local and global competitors. In addition, the management of MEBPOY employs their efficiencies; expertise and discretions to minimize the cost of its products.
j) Complementary and supplementary products/services which may have an impact on business of the issuer.
If any kind of complementary and supplementary products/services which may have an impact on business of the issuer.
Management perception
The Company has not faced any challenges relating to supplementary and complementary products and Management are concerned with the issue. In future, if necessary, management may diversify the product to be competitive over the competitors.
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CHAPTER-XXI DESCRIPTION OF THE ISSUE
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(a) Issue Size:
Total issue size of 25,000,000 Ordinary Shares of Tk. 10.00 each at par totaling Tk. 250,000,000.00
(b) Number of securities to be issued;
Sl. No. No. of Shares Face Value Amount in BDT
1 25,000,000 10.00 250,000,000.00
Public Offering of 25,000,000 Ordinary Shares of Tk. 10.00 each at par totaling Tk. 250,000,000.00
(c) Authorized capital and paid-up capital;
Sl. No. Particulars Amount in BDT
1 Authorized Capital 3,000,000,000.00
2 Paid-up Capital 1,680,000,000.00
(d) Face value, premium and offer price per unit of securities;
Sl. No. Particulars Amount in BDT
1 Face Value of securities 10.00
2 Premium of securities N/A
3 Offer Price per unit of securities 10.00
(e) Number of securities to be entitled for each category of applicants;
Category Particulars No. of Shares Issue Price per share
Amount in BDT
Eligible investor (EI)
10% of IPO i.e. 1,500,000 Ordinary Shares shall be reserved for
Mutual Funds and CIS 2,500,000
10.00
25,000,000
40% of IPO i.e. 6,000,000 Ordinary Shares shall be reserved for
EI excluding mutual funds and CIS 10,000,000 100,000,000
General Public (GP)
10% of IPO i.e. 1,500,000 Ordinary Shares shall be reserved for
Non Resident Bangladeshis (NRBs) 2,500,000 25,000,000
40% of IPO i.e. 6,000,000 Ordinary Shares shall be reserved for
¶wZMÖ¯’ ¶z ª̀ wewb‡qvMKvix and General Public excluding NRB 10,000,000 120,000,000
Total 25,000,000 250,000,000
(f) Holding structure of different classes of securities before and after the issue
The Company has issued only ordinary shares. Holding structure of different classes of securities before and after the issue are as follows:
Sl. Category of Shareholders
No. of Ordinary Shares Hold Percentage of Holding After conversion
Pre‐IPO Post‐IPO Pre‐IPO Post‐IPO Pre‐IPO Post‐IPO
1 Directors & Sponsors 65,209,680 65,209,680 38.82% 33.79%
N/A N/A
2 Other than Directors & Sponsors 102,790,320 102,790,320 61.18% 53.26%
3 Eligible investor (EI)
EI excluding mutual funds and CIS - 10,000,000 - 5.18%
Mutual Funds and CIS - 2,500,000 - 1.30%
4 General Public (GP)
GP excluding NRB - 10,000,000 - 5.18%
NRB - 2,500,000 - 1.30%
Total 168,000,000 193,000,000 100% 100%
Apart from the above, there is no other class of securities issued by MEBPOY.
(g) Objective of the issue including financing requirements and feasibility in respect of enhanced paid-up capital
Objective of the Issue
Net proceeds from Initial Public Offer (IPO) will be used for Procurement of Machinery for FDY Project.
Summary
Sl. Particulars Total Amount
(Tk.) (Tk.)
1 Financing requirement for expansion project 244,494,439
2 Source of financing and Utilization of fund
138
Source of Financing
A. Initial Public Offer (IPO) subject to approval of regulatory authority 250,000,000
B. Internal Source (existing business operation) 12,639,939
262,639,939
C. Less: IPO expense 18,145,500
Total project Cost 244,494,439
Sl. Utilization of IPO proceeds Amount in BDT
1 Procurement of Machinery for FDY Project 231,854,500
2 IPO expenses 18,145,500
Total 2,500,000,000
Beside, details use of Proceeds from Initial Public Offer (IPO) subject to approval of the regulatory authority mentioned in the CHAPTER-XXII under the head “Use of proceeds” of this prospectus.
139
CHAPTER – XXII USE OF PROCEEDS
140
The use of the issue proceeds shall be disclosed in the prospectus in details: provided that not more than 1/3rd of the issue proceeds shall be used for repayment of loans or as working capital. The following disclosures shall be made in this regard:
(a) Use of net proceeds of the offer indicating the amount to be used for each purpose with head-wise break-up
Sl. Utilization of IPO proceeds Amount in BDT Approximate date for
utilization of fund Remarks
1 Procurement of Machinery for FDY Project
231,854,500 Within 4 months of
receiving IPO proceeds Please see note-1
2 IPO expenses 18,145,500 Time to Time as and when
required Please see break down of
issue expenses
Total 250,000,000
Note-1: Details of procurement of Machinery for FDY Project
Sl. Particulars Details Source Amount in BDT
1 Machinery Please see Note below* IPO fund 231,854,500
Total 231,854,500
Note: Required machinery*:
Sl. Items Amount in Taka
1 Oerlikon-Barmag Make high speed Spinning and Winding machine 157,645,789 2 PET Chips Dryer - Capacity 35 tons/day 7,150,000 a. LP Air Dryer 307,500 b. Dry Chips Hopper 1no. 274,000 c. Wet Chips Hopper 1no. 238,000 d. Insultation Material 5,440,000 3 Chips Charging system a. Hoist 2 nos. 146,000 4 HTM - Boiler System (cap 900 L) 1 no. 1,640,000 5 Spin finish preparation equipment 369,000 6 Spin finish supply equipment 262,000 7 Auxilury Equipment 5,000,000 a. Spinnerets inspection m/c 200,000 b. Vacuum furnace 300,000 c. Pack Pre Heater - 1 no 820,000 8 AHU 14,600,000 9 Chiller - 400 TR - vapor Absorption base - 1 no 5,300,000 a. Chilled Water Pump 984,000 b. Piping, Valve & Fittings 2,460,000 c. Cooling water pump 1,230,000
10 Comp air drying Unit - 1500 cfm - 2 no 1,640,000 11 Conversion of Comp - LP to HP - KPCL - 750 cfm - 5 bar to 725 - 10 Bar 246,000 12 Piping, Valve & fittings 984,000 13 Computerized FDY - Packing conveyor - 1 no 2,460,000 14 winder maintenance equipment 1,589,345 15 Intermingling jets facility - 2 sets 492,000 16 Air Receiver tanks - 2 Nos. (20 NM3) 820,000 17 Electrical Infrastructure 4,500,000 18 Civil Infrastructure 9,225,000 19 Mechanical Infrastructure 10,505,000 20 Commissioning Expenses: Technicians transportation - boarding / lodging etc 2,800,000 21 Pre operative Expenses and trial run 4,866,805
Total utilization for FDY Project 244,494,439
Note: Considering to technological change machineries model and amount may be changed at the time of purchase.
(b) Utilization of the total amount of paid-up capital and share premium, if any, including the sponsors’ contribution and capital raised of the issuer at the time of submission of prospectus, in details with indication of use of such funds in the financial statements;
Out of Tk. 168 crore paid up capital as on 30 September, 2017, Tk. 70 core was raised in cash form. Rest of the amount was raised as bonus share out of retained earnings.
141
Application of Tk. 70 crore as below in the financial statements:
Year Item Amount Indication in the Financial Statements
2002 Cash and Bank Balance & Preliminary
Expenses 500,000
In the Balance sheet it is shown included as Cash
and Bank & Preliminary Expenses.
2005 Factory building & Advance, Deposit and
Prepayments 20,000,000
In the Balance sheet it is shown as Fixed assets &
Advance, Deposit and Prepayments.
2010 DTY Machinery 79,500,000 In the Balance sheet it is shown as Fixed assets.
2012 Payment to Mohammed Elias Brothers (Pvt.) Ltd. against purchase of Textile Division Unit 1 and 2.
600,000,000 In the Balance sheet it is shown as payment of non-
interest bearing loan payment
Total 700,000,000
(c) If one of the objects is an investment in a joint venture, a subsidiary, an associate or any acquisition, details of the form of investment, nature of benefit expected to accrue to the issuer as a result of the investment, brief description of business and financials of such venture;
The Company has no objective to invest its net proceeds of IPO in any Joint venture, a subsidiary, associate or acquisition purpose.
(d) If IPO proceeds are not sufficient to complete the project, then source of additional fund must be mentioned. In this connection, copies of contract to meet the additional funds are required to be submitted to the Commission. The means and source of financing, including details of bridge loan or other financial arrangement, which may be repaid from the proceeds of the issue along with utilization of such funds;
Additional fund requirement beyond IPO proceeds (estimated)
Total Fund required for completion of the
project
Fund raised before IPO for utilization this expansion project
Fund would be raised through IPO for utilization
this expansion project
Additional Fund would be required beyond IPO fund for utilization this
expansion project
Sources & Means of Additional
Fund
244,494,439 Nil 231,854,500 * 12,639,939 ** 12,639,939
*Excluding IPO expense
** Mechanical Infrastructure and Commissioning Expenses which would be meetup from internal source.
Utilization of additional fund including internal cash generation
Sl. Particular Amount Area of utilization
01 Amount Additional fund required 12,639,939 Mechanical Infrastructure and Commissioning Expenses
(e) A schedule mentioning the stages of implementation and utilization of funds received through public offer in a tabular form, progress made so far, giving details of land acquisition, civil works, installation of plant and machinery, the approximate date of completion of the project and the projected date of full commercial operation etc. The schedule shall be signed by the Chief Executive Officer or Managing Director, Chief Financial Officer and Chairman on behalf of Board of Directors of the issuer
Stages of Expansion project
Sl. Stage of implementation
Progress made so far
Total (Amount in taka)
Approximate date of
utilization of fund
Projected date of completion of
Work Status
Cost already incurred
(Amount in taka)
To be incurred (From IPO)
(Amount in taka)
To be incurred (From other source) (Amount in taka)
1 Leasehold Land & Land development
1,631,999,509 Nil Nil 1,631,999,509 Nil Already completed Done
2 Building 96,953,776 Nil Nil 96,953,776 Nil Already completed Done
3 Procurement of Machinery for FDY Project
Nil 231,854,500 12,639,939 244,494,439
Within 4 months after getting IPO proceeds
Within 5 months after Opening of LC
for Machine Procurement
To be incurred
Total 1,886,189,324*
Note: Excluding IPO Expenses
Sd/- Sd/- Sd/-
Md. Shadidullah Khan
Chief Financial Officer
Mohd. Rezaul Karim
Director & Managing Director Sydul Karim
Chairman
142
(f) If there are contracts covering any of the activities of the issuer for which the proceeds of sale of securities are to be used, such as contracts for the purchase of land or contracts for the construction of buildings, the issuer shall disclose the terms of such contracts, and copies of the contracts shall be enclosed as annexure to the prospectus
As per rule (B)(21)(f) of Annexure-G of Bangladesh Securities and Exchange Commission (Public Issue) Rules, 2015 there is no contract covering any of the activities of the Issuer Company for which the proceeds of sale of securities from IPO is to be used.
(g) If one of the objects of the issue is utilization of the issue proceeds for working capital, basis of estimation of working capital requirement along with the relevant assumptions, reasons for raising additional working capital substantiating the same with relevant facts and figures and also the reasons for financing short with long term investments and an item wise break-up of last three years working capital and next two years projection
IPO proceeds will not be utilized for working capital financing.
(h) Where the issuer proposes to undertake one or more activities like diversification, modernization, expansion, etc., the total project cost activity-wise or project wise, as the case may be
The expansion project shall be completed activity wise.
Source of financing and Utilization of fund for expansion project
Sl. Source of Financing Amount in Tk. %
1 Initial Public Offer (IPO) subject to approval of regulatory authority 231,854,500 92.74
2 IPO expense 18,145,500 7.26
Total fund would be raised through IPO 250,000,000 100.00
3 Internal Source (existing business operation) for mechanical infrastructure and commissioning expenses
12,639,939*
4 Total financing would be needed for expansion project (as per feasibility report)[1+3]
244,494,439
* As per feasibility report commissioning expenses is estimated BDT 2,800,000 which would be adjusted accordingly
Utilization of fund
Sl. Area of Utilization Internal Source IPO Amount in Tk.
1 Machineries 12,639,939 231,854,500 244,494,439
2 IPO expense Nil 18,145,500 18,145,500
250,000,000
Activity wise break-up
Amount in Taka
Sl. Particulars Total
1 Machinery Procurement 212,597,634
2 Electrical Infrastructure 4,500,000
3 Civil Infrastructure 9,225,000
4 Mechanical Infrastructure 10,505,000
5 Commissioning* 2,800,000
6 Trial Run 4,866,805
Total 244,494,439
(i) Where the issuer is implementing the project in a phased manner, the cost of each phase, including the phases, if any, which have already been implemented;
Sl. Particulars Amount in taka
1 Total Project Cost 244,494,439*
Which Comprises of:
A Phase-1 Building and civil construction
Expansion project shall be situated in existing
business premises accordingly no additional
would be incurred in this aspect Nil
B Phase-2 Machinery Procurement and infrastructure, commissioning expenses and trial run
Cost to be incurred 244,494,439
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Total 244,494,439
*To be incurred Details: Sl. Proposed Capital Structure Amount in Taka
A Debt Bank Loan Nil
B Equity IPO Proceeds (Subject to Approval by BSEC) 231,854,500
Internal Cash Generation 12,639,939
Total to be incurred 244,494,439
(j) The details of all existing or anticipated material transactions in relation to utilization of the issue proceeds or project cost with sponsors, directors, key management personnel, associates and group companies;
There is no such transaction occurred or shall be occurred in terms of utilization of IPO proceeds with sponsor, directors, Key management personnel, associate and Group companies.
(k) Summary of the project appraisal or feasibility report by the relevant professionals not connected with the issuer, issue manager and registrar to the issue with cost of the project and means of finance, weaknesses and threats, if any, as given in the appraisal or feasibility report.
Summary of Feasibility of MOHAMMED ELIAS BROTHERS POY MANUFACTURING PLANT LTD.
Executive Summary OF
Mohammed Elias Brothers POY Manufacturing Plant Ltd.
Executive Summary
Mohammed Elias Brothers POY Manufacturing Plant Ltd. was incorporated on August 01, 2002 vied registration no. C-No-4410 of 2002 as a private limited company in Bangladesh under the Companies Act, 1994. It has started its commercial production on January 01, 2007. The Company was converted itself as a Public Limited Company under the Companies Act, 1994. The registered office of the company located at As Salam Tower (7th floor), 57, Agrabad C/A, Chittagong-4100 & factory office of the company is located at its own premises at 49/P Kalurghat Heavy Industrial Area, Word No.-5 Mohara, P.S-Chandgaon, Chittagong. The authorized capital of the Company is Tk. 300 crore and its present paid up capital is Tk. 168 crore. The company owns and operates a modern POY factory and produces Partially Oriented Yarn (POY) and transfers the same to textile units where it is further processed to produce Draw Textured Yarn (DTY) as final or finished product and sells the same in the local market.
The Company:
Mohammed Elias Brothers POY Manufacturing Plant Ltd. was incorporated on August 01, 2002 vied registration no. C-No-4410 of 2002 as a private limited company in Bangladesh under the Companies Act, 1994. It has started its commercial production on January 01, 2007. The Company was converted itself as a Public Limited Company under the Companies Act, 1994. The company existing installed capacity is 9,800 MT per annum.
Land and Building:
Mohammed Elias Brothers POY Manufacturing Plant Ltd. has 111.65 Khata of land at Char Rangamatia CDA’S Kalurghat Heavy Industrial Estate, Word No.-5 Mohara, PS. Chandgaon, Chittagong on which the plant of the Company is situated. The land is occupied by Multi-storied Bulling, Frame structure with R.C.C. pilling and secured with boundary wall & security room.
Present Employee: Head Office Plant Tota1
Officers 19 23 42 Office Staffs 8 30 38 Security Guard Nil 10 10 Worker Nil 169 169 Weakness
◊ Limited market ◊ Fluctuations of International Raw Materials Market
Threat ◊ Frequently Changes of modern technology ◊ Increase of costing of maintenance of plant & machinery ◊ Migration of skilled manpower
Increase of costing of power.
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AN OVERVIEW
FDY units in Bangladesh:
Of all the similar units in the Country Only 2 units are operational. Most of these are characterized by outdated technology, frequent breakdowns, inferior quality products, chronic working capital shortage and under-utilization of the installed capacity. The resulting higher production costs have continually squeezed profit margins. A modern plant, minimum process loss, and low labor overhead due to small work forces give Mohammad Elias Brothers POY Manufacturing Plant Ltd considerable cost advantage over rivals. With the Growing trend of increased CONSUMPTION of FDY, the internal requirement of product is rapidly increasing. As pointed out earlier, only 20% of the need can be met by the Local production and the balance 80% has to be imported. The gap between the import cost and the manufacturing cost is too big and the feasibility of a new unit in Bangladesh is too high. At the same time, the demand of FDY is increasing at the rate of 12% per annum.
Internal restructuring:
The use of Synthetic Yarn and the related industry is at present undergoing rapid structural changes, triggered in part by the withdrawal of import restrictions and the imminent easing of the import duty structure. The older units are increasingly failing to utilize capacity due to higher costs and inferior processing quality while the modern units are enjoying better capacity utilization especially in the face of an increased quality conscious market. Capacity adjustments substitutions between the older and modern units are expected to accelerate, providing the basis for a higher rate and higher market share for the modern units. Mohammed Elias Brothers POY Manufacturing Plant Ltd is set to be the major beneficiary of this trend. The increasing expansion of Garments factory in the country has boost up the need of more and more Synthetic yarn, especially FDY which opened a new dimension in this sector.
Mohd. Elias Brothers POY Manufacturing Plant Ltd is equipped with latest state-of the-art technology. The company has already appointed Mr. R. C. Sharma of New Delhi, India, a renowned FDY Consultants for the detailed plan and implementation of the project. It is going to sign an agreement with the leading supplier for turnkey supply, installation and commissioning of main plant and machinery for future expansion.
Raw Materials The main raw material is PET CHIPS (BRIGHT) which amounts to about 99.90% of the cost of the total raw used. The entire raw materials will be procured from aboard. Apart from these, other consumable utilities will also be imported whilst all other packing materials will be procured from the local market.
Capacity The factory is a process industry. Normally 100% capacity utilization in a process industry can be achieved soon after commencement of commercial operations and this has been observed by the project consultants who were actively involved as technical consultants in setting up few plants in India. However, the capacity utilization figures have been conservatively estimated at 95% for first four years of operation and thereafter a maximum utilization of capacity is being considered at 97% from the 5th year onwards. The installed Capacity of the plant is 4380000 kg and the following are the estimated production figures (based on 345 working days per year at 3 shifts of 8 hours):
Project Implementation Project conceptualization, planning and preparation period has started from 1-10-2010. The project is likely to be implemented within 18 months from the Zero date i.e. from the date of opening Letter of Credit.
Project Management The project consultants have been assigned to undertake the techno-economic feasibility study of the extension project, to
supervise and control different activities of the project at different stages e.g., to identify and select plant and machinery, to
assist the Company in identifying and sourcing skilled technical personnel from overseas with the overall responsibility of
overseeing and coordinating different project activities for smooth and timely implementation of the project. A program of
recruitment and training will have to be drawn up by the company to ensure that key operational staffs are available at least
2 months prior to commencement of the trial and commissioning of the plant of extension project. The necessary raw material
and consumables will have to be procured in advance to enable trails and commissioning to proceed according to schedule.
The Suppliers of the Equipment will be responsible for delivering of the manufacturing equipment to the site and their commissioning. They will also provide support for the preparation of detailed drawings, utility layouts and erection instruction as and when necessary. Basic layouts of production buildings, the requirement of various utilities and raw materials and the provision of performance guarantees will also fall under their domain.
Human Resources
The company does not foresee any problems in sourcing semi-skilled and non-skilled workers which are abundantly available locally. The Company plans to recruit the Chief Production Executives soon, if needed from aboard with substantial relevant experience in POY/FDY industry with specification in this lines. The Company also plans to recruit about 06 other technical staff to ensure smooth start-up and commercial operations for at least one year. These staff will be hired on a contract basis
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and include a Works Manager, Managers for Operation and Maintenance, Quality Control supported by a team of experienced engineers and skilled workers. The company will also recruit local engineers and
skilled workers who shall be trained during the first six months of operations and run the plant in future.
Machinery
A Items Amount in Taka
1 Oerlikon-Barmag Make high speed Spinning and Winding machine 157,645,789
2 PET Chips Dryer - Capacity 35 tons/day 7,150,000
a. LP Air Dryer 307,500
b. Dry Chips Hopper 1no. 274,000
c. Wet Chips Hopper 1no. 238,000
d. Insulation Material 5,440,000
3 Chips Charging system
a. Hoist 2 nos. 146,000
4 HTM - Boiler System (cap 900 L) 1 no. 1,640,000
5 Spin finish preparation equipment 369,000
6 Spin finish supply equipment 262,000
7 Auxiliary Equipment 5,000,000
a. Spinnerets inspection m/c 200,000
b. Vacuum furnace 300,000
c. Pack Pre Heater - 1 no 820,000
8 AHU 14,600,000
9 Chiller - 400 TR - vapor Absorption base - 1 no 5,300,000
a. Chilled Water Pump 984,000
b. Piping, Valve & Fittings 2,460,000
c. Cooling water pump 1,230,000
10 Comp air drying Unit - 1500 cfm - 2 no 1,640,000
11 Conversion of Comp - LP to HP - KPCL - 750 cfm - 5 bar to 725 - 10 Bar 246,000
12 Piping, Valve & fittings 984,000
13 Computerized FDY - Packing conveyor - 1 no 2,460,000
14 winder maintenance equipment 1,589,345
15 Intermingling jets facility - 2 sets 492,000
16 Air Receiver tanks - 2 Nos. (20 NM3) 820,000
17 Electrical Infrastructure 4,500,000
18 Civil Infrastructure 9,225,000
19 Mechanical Infrastructure 10,505,000
20 Commissioning Expenses: Technicians transportation - boarding / lodging etc 2,800,000
21 Pre operative Expenses and trial run 4,866,805
Total utilization for FDY Project 244,494,439
Markets The company proposed to manufacture and supply FDY (Fully Draw Yarn) to local market.
Conclusion on the feasibility Study
The following finding can be derived from the above discussion: -
1)Total requirement (Approx.) :100 Ton per day 2) Annual Growth rate per annum : 12% 3) Existing installed capacity in Bangladesh : 25 Ton per Day 4) Existing Production : 15 – 18 tons per day 5) Shortfall : 75% 7) Cost saving over import : Over 25%. 8) Efficiency when compared to other existing units : Higher. 9) Product quality : Better. 10) Man Power requirement : Lower. 11) Marketing net of MEB TEX : Good. 12) Public response to the products : Good. 13) Management : Good. 14) Human resource : Industry average
146
15) Sustain capacity of company in case of complete system failure : 25 days. 16) Cash flow : Remarkable. 17) Power: 100% captive power having additional power generation from the gas Generator 18) Internal Rate of Return (IRR) : 28.90% 19) Accounting Rate of Return (ARR) : 21.57% 20) Net Present Value (NPV) : 223,820,200 21) Payback Period :3.60 years
PROJECTED INCOME STATEMENT 1 Projected Income Statement Year 1 Year 2 Year 3 Year 4 Year 5
Net (Adjusted Sales) 480,000,000 504,000,000 529,200,000 555,660,000 583,443,000
Cost of Sales 319,300,000 335,265,000 352,028,250 369,629,663 388,111,147
Raw Material Cost 300,000,000 315,000,000 330,750,000 347,287,500 364,651,875
Labor (Production Staff) 6,100,000 6,405,000 6,725,250 7,061,513 7,414,589
Utilities 13,200,000 13,860,000 14,553,000 15,280,650 16,044,683
Gross Profit 160,700,000 168,735,000 177,171,750 186,030,337 195,331,853
Gross Profit Margin 33.48% 33.48% 33.48% 33.48% 33.48%
General Administrative & Selling Expenses
Salaries 17,500,000 18,375,000 19,293,750 20,258,438 21,271,360
Amortization of Preliminary Expenses 2,900,000 2,900,000 2,900,000 2,900,000 2,900,000
Depreciation Expenses 36,674,166 36,674,166 36,674,166 36,674,166 36,674,166
Maintenance Expenses 9,779,778 9,779,778 9,779,778 9,779,778 9,779,778
Promotion Budget 14,400,000 15,120,000 15,876,000 16,669,800 17,503,290
Selling and Distribution 14,400,000 15,120,000 15,876,000 16,669,800 17,503,290
Subtotal 95,653,944 97,968,944 100,399,694 102,951,982 105,631,884
Earnings Before Taxes 65,046,056 70,766,056 76,772,056 83,078,355 89,699,969
Tax 17,887,665 19,460,665 21,112,315 22,846,548 24,667,491
Net Profit / Loss 47,158,391 51,305,391 55,659,741 60,231,807 65,032,478
Accounting Rate of Return 0.215748113
Fixed Cost 57,074,166
Break even calculation: Tk./kg
Selling Price: 200
Variable Cost: 149
Contribution Margin 51
Fixed Cost: 57,074,166
Break Even sales unit (Kg) 1,119,101
Break Even sales amount (Tk) 223,820,200
PROJECTED BALANCE SHEET
Projected Balance Sheet Year 0 Year 1 Year 2 Year 3 Year 4 Year 5
Assets
Current Assets
Cash & Bank Balance - 12,738,118 100,367,675 192,189,082 288,411,930 389,256,293
Inventory - 25,000,000 26,250,000 27,562,500 28,940,625 30,387,656
Accounts Receivables - 40,000,000 42,000,000 44,100,000 46,305,000 48,620,250
Total Current Assets - 77,738,118 168,617,675 263,851,582 363,657,555 468,264,199
Fixed Assets
Plant Machinery & Facilities 244,494,439 244,494,439 244,494,439 244,494,439 244,494,439 244,494,439
Accumulated Depreciation 36,674,166 73,348,332 110,022,498 146,696,664 183,370,830
Total Fixed Assets 244,494,439 207,820,273 171,146,107 134,471,941 97,797,775 61,123,609
Intangible Assets
Preliminary Expenses 14,500,000 11,600,000 8,700,000 5,800,000 2,900,000 -
Total Assets 258,994,439 297,158,391 348,463,782 404,123,523 464,355,330 529,387,808
Owner's Equity 250,000,000 50,000,000 250,000,000 250,000,000 250,000,000 250,000,000
Retained Earnings - 47,158,391 98,463,782 154,123,523 214,355,330 279,387,808
Other Liability 8,994,439 - - - - -
Total Equity & Liability 258,994,439 297,158,391 348,463,782 404,123,523 464,355,330 529,387,808
PROJECTED CASH FLOW STATEMENT
Projected Statement of Cash Flows
Year 0 Year 1 Year 2 Year 3 Year 4 Year 5
Cash Flow From Operating Activities
Net Profit - 47,158,391 51,305,391 55,659,741 60,231,807 65,032,478
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Add Depreciation Expenses
- 36,674,166 36,674,166 36,674,166 36,674,166 36,674,166
Amortization Expenses - 2,900,000 2,900,000 2,900,000 2,900,000 2,900,000
(Increase)/decrease in Receivables
- (40,000,000) (2,000,000) (2,100,000) (2,205,000) (2,315,250)
(Increase)/decrease in Stock
- (25,000,000) (1,250,000) (1,312,500) (1,378,125) (1,447,031)
Net Cash Flow From Operations
- 21,732,557 87,629,557 91,821,407 96,222,848 100,844,363
Cash Flow From Financing Activities
Owners Equity 250,000,000 - - - - -
Other 8,994,439 (8,994,439) - - - -
Net Cash Flow From Financing Activities
258,994,439 (8,994,439) - - - -
Cash Flow From Investing Activities
Capital Expenditure (244,494,439) - - - - -
Preliminary expenses (14,500,000) - - - - -
Net Cash Flow From Investing Activities
(258,994,439) - - - - -
Net Cash Flow - 12,738,118 87,629,557 91,821,407 96,222,848 100,844,363
Cash at the Beginning of the period
- - 12,738,118 100,367,675 192,189,082 288,411,930
Cash at the End of the period
- 12,738,118 100,367,675 192,189,082 288,411,930 389,256,293
IRR & NPV Calculation: Present Value at 6th year of next 5 year's cash flow considering growth rate 0% & discounting factor 10%
Discount rate (%)
Growth rate (%)
Number of years
Cash Flow For IRR, NPV (258,994,439) 21,732,557 87,629,557 91,821,407 96,222,848 100,844,363 382,279,477 10.00 - 5
Cumulative Cash Flow (258,994,439) (237,261,882) (149,632,325) (57,810,918) 38,411,930 139,256,293 521,535,770
IRR 28.90% 382,279,477
NPV 246,295,049
Fraction Calculation n/m n/m n/m n/m 0.600802 0.380903
Payback Period 3.60080
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CHAPTER- XXIII LOCK- IN
149
(a) Provisions for lock in as per these Rules
Ordinary shares of the issuer shall be subject to lock-in, from the date of issuance of prospectus or commercial operation, whichever comes later, in the following manner:
(1) All shares held, at the time of according consent to the public offer, by sponsors, directors and shareholders holding ten percent (10%) or more shares, other than alternative investment funds, for 03(three) years.
(2) In case any existing sponsor or director of the issuer transfers any share to any person, other than existing shareholders, all shares held by those transferee shareholders, at the time of according consent to the public offer, for 03 (three) years.
(3) Twenty five percent (25%) of the shares allotted to eligible investors, for 06 (six) months and other twenty five percent (25%) of the shares allotted to them, for 09 (nine) months.
(4) All shares held by alternative investment funds, at the time of according consent to the public offer, for 01 (one) year.
(5) All shares held, at the time of according consent to the public offer, by any person other than the persons mentioned in sub-rules (1), (2) and (3) above, for 01 (one) year.
Provided that ordinary shares converted from any other type of securities shall also be subject to lock-in as mentioned above.”.
(b) Statement of securities to be locked in for each shareholder along with BO account number, lock-in period and number of securities to be locked-in
Sl. Name of Shareholders BO ID Number No. of Shares % of securities
owned Before IPO
Lock in period from the date of issuance
of prospectus
Shareholding by Directors
1 Mr. Sydul Karim 1201 8400 4030 8269 8,230,014 4.90% 3 years
2 Mohd. Rezaul Karim 1201 5900 6417 2090 8,230,014 4.90% 3 years
3 Mohd. Abrar Hossain 1201 5900 6417 1971 9,097,619 5.42% 3 years
4 Mohd. Ashfak Hossain 1201 5900 6417 2082 9,209,618 5.48% 3 years
5 Mohd. Asrar Hossain 1201 5900 6417 8494 9,097,619 5.42% 3 years
Shareholding by sponsors
6 Mohd. Shamsul Alam 1203 7300 0646 4790 2,603,966 1.55% 3 years
7 Mohd. Nurul Absar 1201 8400 0646 4787 1,497,384 0.89% 3 years
8 Mohd. Nurul Alam 1201 5900 6417 2066 1,497,384 0.89% 3 years
9 Mohd. Khurshed Alam 1201 6000 2154 6638 2,603,967 1.55% 3 years
10 Mohd. Murshed Alam 1203 7900 6430 4318 2,604,067 1.55% 3 years
11 Mohd. Aminul Karim 1201 5900 6417 2015 3,248,000 1.93% 3 years
Other Shareholding
12 Mr. Abdus Salam 1204 2900 4465 5722 26,880,000 16.00% 3 years
13 Mir Mohammad Hossain - 15,120,000 9.00% 1 year
14 Mir Muhammad Nasir - 15,120,000 9.00% 1 year
15 Mir Mohammed Hassan 1204 2900 6431 4259 15,120,000 9.00% 1 year
16 Mr. Jan-E- Alam 1201 5900 4499 6510 3,645,014 2.17% 1 year
17 Mr. Zakaria Alam 1201 8400 2119 6961 3,645,014 2.17% 1 year
18 Mohd. Rashedul Alam - 2,520,000 1.50% 1 year
19 Mohd. Asraf Hossain 1201 8400 3366 1076 3,360,000 2.00% 1 year
20 Mr. Hasan Imam Chowdhury 1203 2200 4274 4276 3,360,000 2.00% 1 year
21 Mr. Liakat Ali Chowdhury 1201 5900 3280 3323 2,800,000 1.67% 1 year
22 Swadesh Investment Management Ltd.
1204 3800 2185 5128 2,324,000 1.38% 1 year
23 A.K.M Suja Chowdhury 1204 0900 2318 2598 2,240,000 1.33% 1 year
24 Md. Jamil Abedin 1203 2200 3942 6164 1,120,000 0.67% 1 year
25 Md. Zaynal Abedin 1203 2200 3801 4533 1,120,000 0.67% 1 year
26 Mrs. Urmy Akhter, 1203 6800 4471 9396 1,120,000 0.67% 1 year
27 Md. Moslem Uddin 1301 0300 0020 7430 1,120,000 0.67% 1 year
28 Shamsul Alam 1203 2200 3145 0868 616,000 0.37% 1 year
29 Md. Nobab Khan 1201 8900 0776 2574 560,000 0.33% 1 year
30 Md. Alauddin 1203 2200 3942 6959 560,000 0.33% 1 year
31 Mr. R.Y. Shamsher 1204 0900 1541 6341 560,000 0.33% 1 year
32 Mr. Motiur Rahman 1202 8800 0413 3529 560,000 0.33% 1 year
33 People’s Leasing & Financial Service Ltd.
1202 8800 1554 3649 560,000 0.33% 1 year
34 Md. Nowshad Ahmed Chy & Giass Uddin
1204 9000 4475 8382 560,000 0.33% 1 year
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35 Arssmas Trading 1203 2200 4480 4943 532,000 0.32% 1 year
36 H.M. Akhtarul Alam 1202 4300 0392 9189 392,000 0.23% 1 year
37 Mr. Nasiruddin Chowdhury 1202 9900 3693 2861 336,000 0.20% 1 year
38 M/s. Azan Stores 1202 9900 3810 5534 336,000 0.20% 1 year
39 Mrs. Syeda Nurun Nahar 1203 2200 1653 1644 324,800 0.19% 1 year
40 Horizon Network 1203 2200 4481 2007 252,000 0.15% 1 year
41 Houssain Al Ashkari 1201 5900 6421 8012 224,000 0.13% 1 year
42 Mr. Anis Uddin 1203 7900 0384 3412 196,000 0.12% 1 year
43 Mrs. Mymuna Khatun & Mr. Ahmed Sabur
1202 8500 4497 4450 168,000 0.10% 1 year
44 Capt. A.S.M. Shah Alam 1203 2200 3767 8677 150,080 0.09% 1 year
45 Mrs. Hamida Bilquish Chowdhury
1203 9200 3283 1160 140,000 0.08% 1 year
46 Md. Abu Bakar Siddique 1203 7900 0427 7249 123,200 0.07% 1 year
47 Mr. Nawshed Ahmed Chowdhury
1203 6800 0509 8491 112,000 0.07% 1 year
48 Mr. Nazmi Saifuddin 1201 7800 0053 6222 112,000 0.07% 1 year
49 Mr. Khurshed Ul Alam 1203 5600 0015 1958 112,000 0.07% 1 year
50 Md. Imamul Hoque 1204 7500 4498 7352 112,000 0.07% 1 year
51 Mrs. Nazia Farzeen 1201 5900 0138 1402 112,000 0.07% 1 year
52 Md. Khorshed Alam 1203 2200 1968 6883 112,000 0.07% 1 year
53 Mr. Mohammad Wasim 1201 6800 1614 1505 112,000 0.07% 1 year
54 Mr. Naim Hassan 1203 2100 2159 9207 112,000 0.07% 1 year
55 Mr. Zabed Ul Alam 1203 7900 0437 2994 112,000 0.07% 1 year
56 Mr. Modhusudan Bhowmik 1202 0900 3543 2166 112,000 0.07% 1 year
57 Mr. Saleh Johur Mia 1204 2800 2138 7958 112,000 0.07% 1 year
58 Abdullah al Mamun 1201480018017139 112,000 0.07% 1 year
59 Mr. Mohammed Jamal Uddin 1203 2200 1831 0271 67,200 0.04% 1 year
60 Mr. Saifuddin Joher 1201 7800 3734 7728 67,200 0.04% 1 year
61 Mrs. Tahmina Begum 1203 7900 3693 4411 63,840 0.04% 1 year
62 Mr. Hasan Murad Siddique 1203 7900 3775 1425 56,000 0.03% 1 year
63 Mr. Abdul Mabud 1201 6000 1921 7759 6,000 0.01% 1 year
64 Mr. Abul Hashem 1203 7900 3775 8443 6,000 0.01% 1 year
65 Mr. Abul Kashem 1203 7900 3798 5871 56,000 0.03% 1 year
66 Mr. Boktir Meah 1301 0300 1335 0791 6,000 0.01% 1 year
67 Mr. Miskatul Islam Chowdhury 1301 0300 0007 7319 56,000 0.03% 1 year
68 Amir Muhammad Monowar Hossain (Rajib)
1203 0600 2033 6160 56,000 0.03% 1 year
69 Mrs. Nishat Jarin 1204 1800 2552 3040 56,000 0.03% 1 year
70 Mr. Forkan Ahmed Nahid 1203 2200 1892 8746 56,000 0.03% 1 year
71 Mr. Tahmid Anwar 1202 7400 3802 4937 56,000 0.03% 1 year
72 Md. Shohebul Hassan 1202 4000 1743 1460 56,000 0.03% 1 year
73 Mr. Shalah Uddin Ahmed 1201 8400 3941 1924 56,000 0.03% 1 year
74 Mir Motaher Hossain 1204 5900 4130 6478 56,000 0.03% 1 year
75 Jahangir Alam 1203 6800 0859 3899 56,000 0.03% 1 year
76 Mr. Firoz Saifuddin Joher 1203 3300 3246 5222 44,800 0.03% 1 year
77 Mr. Sohel Uddin Kader Chowdhury
1204 180 0397 64157 28,000 0.02% 1 year
78 Mr. Chandan Dhar 1202 1300 1858 1339 28,000 0.02% 1 year
79 Solaiman Member 1301 0300 0023 3145 28,000 0.02% 1 year
80 S. K. Shahidul Alam 1203470033104755 11,200 0.01% 1 year
Grand Total 168,000,000 100%
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CHAPTER-XXIV MARKETS FOR THE SECURITIES BEING OFFERED
152
Market for the Securities being offered
The issuer shall apply to the following stock exchanges in Bangladesh within seven working days from the date of consent accorded by the Commission.
Dhaka Stock Exchange Limited (DSE) Stock Exchange Building
9/F, Motijheel C/A, Dhaka-1000
Chittagong Stock Exchange Limited (CSE) CSE Building, 1080 Sk. Mujib Road,
Agrabad C/A, Chittagong
Declaration about Listing of Shares with the Stock Exchange(s)
If none of the Stock Exchange(s), if for any reason, grant listing within 75 days from the closure of subscription, any allotment in terms of this Prospectus shall be void and the company shall refund the subscription money within fifteen days from the date of refusal for listing by the stock exchange, or from the date of expiry of the said 75 (seventy five) days, as the case may be.
In case of non-refund of the subscription money within the aforesaid fifteen days, the company directors, in addition to the issuer company, shall be collectively and severally liable for refund of the subscription money, with interest at the rate of 2% (two percent) per month above the bank rate, to the subscribers concerned.
The issue manager, in addition to the issuer company, shall ensure due compliance of the above mentioned conditions and shall submit compliance report thereon to the Commission within seven days of expiry of the aforesaid fifteen days’ time period allowed for refund of the subscription money.
Trading and Settlement
Trading and Settlement Regulation of the stock exchanges shall apply in respect of trading and settlement of the shares of the company.
The issue shall be placed in “N” Category with DSE & CSE.
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CHAPTER-XXV DESCRIPTION OF SECURITIES OUTSTANDING OR BEING OFFERED
154
Description of securities outstanding or being offered
All types of securities outstanding or being offered with date or proposed date of such issue and to whom those are offered, number of securities and issue or offer price along with the following information:
Sl. Date of Offer Types of securities
Form of consideration
No. of shares
Offer price
Offered to
1 At the time of incorporation as on August 01, 2002
Ordinary Share Cash 5,000 100 Subscriber to the
memorandum
2 Issued as on April 14, 2005 Ordinary Share Cash 200,000 100 Existing shareholders
3 Issued as on March 22, 2010 Ordinary Share Cash 95,000 100 Existing shareholders
4 Issued as on March 29, 2010 Ordinary Share Cash 700,000 100 Existing shareholders
5 Bonus Share Issue on November 20, 2011 Ordinary Share Bonus Shares 80,000,000 10 Existing shareholders
6 Issued as on November 24, 2011 Ordinary Share Cash 8,900,000 10 Existing shareholders
7 Issued as on November 27, 2011 Ordinary Share Cash 3,650,000 10* Existing shareholders
8 Issued as on January 02, 2012 Ordinary Share Cash 47,450,000 10 Existing shareholders
9 Bonus Share Issue on December 22, 2013 Ordinary Share Bonus Shares 18,000,000 Existing shareholders
The Company has subdivided the face value of its ordinary share from BDT 100.00 to BDT 10.00 by passing a special resolution in its Extraordinary General Meeting held on 21th October, 2010. Thus, paid-up capital of the Company comes to BDT 1,680,000,000/- (Taka One hundred sixty-eight crores only) divided into 168,000,000/- nos. ordinary shares of BDT 10.00 each.
(a) Dividend, voting and preemption rights
The Share Capital of the company is divided into Ordinary Shares, carrying equal rights to vote and receive dividend in terms of the relevant provisions of the Companies Act, 1994 and the Articles of Association of the company. All shareholders shall have the usual voting right in person or by proxy in connection with, among others, election of Directors & Auditors and other usual agenda of General Meeting – Ordinary or Extra Ordinary. On a show of hand, every shareholder who is present in person and every duly authorized representative of a shareholder present at a General Meeting shall have one vote and on a poll every shareholder present in person or by proxy shall have one vote for every share held by him or her.
In case of any additional issue of shares for raising further capital the existing shareholders shall be entitled to Right Issue of shares in terms of the guidelines issued by the BSEC from time to time.
(b) Conversion and liquidation rights
The company in its General Meeting may convert paid-up shares to any denomination. No special preferences or privileges shall be attached to this conversion.
If the company at any time issue convertible Preference Shares or Debentures or Bonds with the consent of BSEC, such holders of securities shall be entitled to convert such securities into ordinary shares if it is so determined by the company.
In case of winding-up or liquidation of the company, all shareholders have the same privileges and advantages as ordinary shareholders as regards participation in profits and voting at meetings of the company.
Right for transfer
In terms of the provisions of the Companies Act, 1994, Articles of Association of the Company and other relevant rules in force, the shares of the Company are freely transferable. The Company shall not charge any fee for registering transfer of shares. No transfer shall be made to a firm, an infant or person of unsound mind.
(c) Dividend policy
a) The profit of the Company, subject to any special right relating thereto created or authorized to be created by the Memorandum of Association and subject to the provisions of the Articles of Association, shall be divisible among the members in proportion to the amount of capital paid-up on the shares held by them respectively.
b) No larger dividend shall be declared than is recommended by the Directors, but the Company in its General Meeting may declare a smaller dividend. The declaration of Directors as to the amount of Net Profit of the Company shall be conclusive.
c) No dividend shall be payable except out of the profits of the Company or any other undistributed profits. Dividend shall not carry interest as against the Company.
d) The Directors may from time to time pay the members such interim dividend as in their judgment the financial position of the Company may justify.
e) A transfer of shares shall not pass the right to any dividend declared thereon before the registration of transfer. f). There is no limitation on the payment dividends to the common stockholders of the Company.
(d) Other rights of stockholders
The shareholders shall have the right to receive all periodical statement and reports, audited as well as unaudited, published by the company from time to time. The Directors shall present the financial statements as required under the law & Bangladesh Accounting Standard (BAS). Financial statements will be prepared in accordance with the Bangladesh Accounting Standards, consistently applied throughout the subsequent periods and present with the objective of providing maximum disclosure as
155
par law and Bangladesh Accounting Standard to the shareholders regarding the financial and operational position of the company.
In case of any declaration of stock dividend by issue of bonus shares, all shareholders will be entitled to it in proportion to their shareholdings on the date of book closure or record date for the purpose.
The shareholder holding minimum of 10% shares of paid-up capital of the company shall have the right to requisition Extra-ordinary General Meeting of the company as provided for the section 84 of the Companies Act 1994.
Debt Securities
The Company has not issued or planning to issue any debt securities within six months.
156
CHAPTER -XXVI FINANCIAL STATEMENTS
157
(a) The latest financial statements prepared and audited by any of the Commission’s panel of auditors in adherence to the provisions of the Securities and Exchange Rules, 1987, the †Kv¤úvwb AvBb, 1994, International Financial Reporting and Auditing
Standards as adopted in Bangladesh from time to time and any other law as applicable;
AUDITORS’ REPORT TO THE SHAREHOLDERS OF
MOHAMMED ELIAS BROTHERS POY MANUFACTURING PLANT LIMITED
We have audited the accompanying financial statements of Mohammed Elias Brothers POY Manufacturing Plant Limited, which comprise the Statement of Financial Position as at 30th September 2017 and the related Statement of Profit or Loss and Other Comprehensive Income, Statement of Changes in Equity and Statement of Cash Flow and for the period then ended and a summary of significant accounting policies and other explanatory notes.
Management’s Responsibility for the Financial Statements
Management of Mohammed Elias Brothers POY Manufacturing Plant Limited is responsible for the preparation and fair presentation of these financial statements in accordance with Bangladesh Financial Reporting Standards (BFRS), the Companies Act 1994, the Securities & Exchanges Rules 1987 and other applicable laws and regulations. This responsibility includes; designing, implementing and maintaining internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error; selecting and applying appropriate accounting policies; and making accounting estimates that are reasonable in the circumstances.
Auditors’ Responsibility
Our responsibility is to express an independent opinion on these financial statements based on our audit. We conducted our audit in accordance with Bangladesh Standards on Auditing (BSA). Those standards require that we comply with ethical requirements and plan to perform the audit to obtain reasonable assurance whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risks assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Opinion:
In our opinion, the financial statements prepared in accordance with Bangladesh Financial Reporting Standards(BFRS), give a true and fair view of the state of the company’s affairs as at 30th September 2017 and comply with the Companies Act 1994. the Securities & Exchanges Rules 1987 and other applicable laws and regulations. Further to our opinion in the above paragraph, we state that:
(i) We have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit and made due verification thereof;
(ii) In our opinion, proper books of accounts as required by law have been kept by Mohammed Elias Brothers
POY Manufacturing Plant Limited so far as it appeared from our examination of those books; (iii) The Statement of Financial Position and Statement of Profit or Loss and Other Comprehensive Income and
Statement of Changes in Equity and Statement of Cash Flow dealt with by the report are in agreement with the books of account and returns;
(iv) The expenditure incurred was for the purpose of the company’s business.
Sd/- Chittagong Ahmed Zaker & Co.
Chartered Accountants 21 Nov. 2017
158
Mohammed Elias Brothers POY Manufacturing Plant Limited Statement of Financial Position
As at 30 September, 2017
Particulars Notes 30 Sept. 2017 30 June 2017
Taka Taka
ASSETS Non-Current Assets
Property, Plant and Equipment (net of depreciation) 03 2,208,907,201 2,211,992,305 Investments 04 25,120,505 19,597,676 Deferred Tax Assets 05 58,590,327 60,145,834
Total Non-current Assets 2,292,618,033 2,291,735,815
Current Assets
Advances, Deposits and Pre-payments 06 135,229,745 221,266,349 Inventories 07 987,733,590 985,922,018 Trade Receivables 08 1,310,027,810 1,097,629,161 Cash and Cash Equivalents 09 306,501,994 317,560,062
Total current assets 2,739,493,139 2,622,377,590
Total Assets 5,032,111,172 4,914,113,405
EQUITY AND LIABILITIES Shareholders' equity
Share capital 10 1,680,000,000 1,680,000,000 Revaluation surplus 1,452,499,350 1,452,499,350 Retained earnings 11 620,822,604 563,564,030
Total Shareholders' equity 3,753,321,954 3,696,063,380
Non-current Liabilities
Long term portion of term loan 12 468,748,021 474,817,142 Long term portion of lease liabilities 13 126,205,185 120,471,167
Total non-current liabilities 594,953,206 595,288,309
Current Liabilities
Current portion of term loan 12 101,750,000 101,750,000 Current portion of lease liabilities 13 64,507,428 64,507,428 Short term loan 14 197,555,606 161,390,167 Trade payables 15 222,756,660 207,150,876 Other payables 16 7,278,736 6,321,878 Liabilities for expenses 17 32,199,578 27,186,263 Provision for contribution to WPPF 18 3,400,933 6,804,000 Provision for income tax 19 54,387,071 47,651,104
Total current liabilities 683,836,012 622,761,716
Total Liabilities 1,278,789,218 1,218,050,024
Total equity and liabilities 5,032,111,172 4,914,113,405
Net Asset Value Per Share ( NAV ) with revaluation surplus 28 22.34 22.00
Net Asset Value Per Share ( NAV ) without revaluation surplus 28 13.70 13.35
The annexed notes from 1 to 40 and annexure A form an integral part of these financial statements.
Sd/- Sd/- Sd/- Managing Director Director Company Secretary
Signed in terms of our separate report of even date.
Sd/- Chittagong Ahmed Zaker & Co. 21 Nov. 2017
159
Mohammed Elias Brothers POY Manufacturing Plant Limited Statement of Profit or Loss and other Comprehensive Income
For the period ended 30 September, 2017
(Amount in Taka)
Particulars Notes
01 July 2017 to 30 September,
2017
01 July 2016 to 30 September,
2016
01 July 2016 to 30 June 2017
03 Month 03 Month 12 Month
Sales 20 288,141,017 158,656,770 696,935,855
Cost of goods sold 21 (175,702,069) (93,840,152) (453,684,333)
Gross Profit 112,438,948 64,816,618 243,251,522
Administrative expenses 22 (7,878,396) (8,294,154) (34,857,135) Selling and distribution expenses 23 (6,395,022) (2,932,432) (11,729,031)
(14,273,418) (11,226,586) (46,586,166)
Operating profit 98,165,530 53,590,032 196,665,356 Financial expenses 24 (27,399,324) (13,840,573) (80,095,166) Non operating income 25 653,394 647,268 1,315,035
Operating profit before contribution to WPPF 71,419,600 40,396,727 117,885,225 Provision for WPPF (3,400,933) (1,923,654) (5,613,582)
Profit before tax 68,018,667 38,473,074 112,271,643
Provision for Income tax 26 (9,204,586) (4,707,413) 3,740,461 Provision for deferred tax 05.01 (1,555,507) (1,063,548) (4,254,190)
(10,760,093) (5,770,961) (513,729)
Net profit after tax 57,258,574 32,702,113 111,757,914 Other comprehensive income - - -
Total comprehensive income 57,258,574 32,702,113 111,757,914
Earning per share 27 0.34 0.19 0.67
The annexed notes from 1 to 40 and annexure A form an integral part of these financial statements. Figures of the column
'01 July 2016 to 30 September 2016' are un-audited.
Sd/- Sd/- Sd/- Managing Director Director Company Secretary
Signed in terms of our separate report of even date.
Sd/- Chittagong Ahmed Zaker & Co. 21 Nov. 2017
160
Mohammed Elias Brothers POY Manufacturing Plant Limited Statement of Changes in Equity
For the period ended 30 September, 2017 (Amount in Taka)
Particulars Share Revaluation Retained Total
Capital Surplus Earnings Equity
Balance as at 01 July, 2016 1,680,000,000 1,452,499,350 462,924,740 3,595,424,090 Net Profit for the year - - 111,757,914 111,757,914 Prior year adjustment - - (11,118,625) (11,118,625)
Balance as at 30 June 2017 1,680,000,000 1,452,499,350 563,564,030 3,696,063,380
Balance as at 01 July, 2017 1,680,000,000 1,452,499,350 563,564,030 3,696,063,380 Net Profit for the period - - 57,258,574 57,258,574
Balance as at 30 September, 2017 1,680,000,000 1,452,499,350 620,822,604 3,753,321,954
Sd/- Sd/- Sd/- Managing Director Director Company Secretary
161
Mohammed Elias Brothers POY Manufacturing Plant Limited
Statement of Cash Flows
For the period ended 30 September, 2017
Particulars
Notes
01 July 2017 to 30
September, 2017
01 July 2016 to 30 September,
2016
A. CASH FLOW FROM OPERATING ACTIVITIES: Taka Taka
Receipts from customers 29 77,993,868 167,696,689 Payments to suppliers, employees & others 30 (72,621,268) (157,827,598) Receipts from non-operating income 653,394 647,268
Income Tax Paid (2,312,245) -
Net cash (used in) / generated by operating activities 3,713,749 10,516,359
B. CASH FLOW FROM INVESTING ACTIVITIES:
Purchase of property, plant & equipment (17,680,000) - (Increase)/Decrease in investment (5,522,829) (2,880,029)
Net cash (used in) / generated by investing activities (23,202,829) (2,880,029)
C. CASH FLOW FROM FINANCING ACTIVITIES:
Short term loan received/(repaid) 36,165,439 2,382,261 Long term loan received/(repaid) (6,069,120) 13,570,233 Interest Paid (27,399,324) (13,840,573) Lease received/(repaid) 5,734,018 (13,746,700)
Net cash (used in) / generated by financing activities 8,431,013 (11,634,779)
D. INCREASE/(DECREASE) IN CASH AND CASH EQUIVALENTS (A+B+C) (11,058,068) (3,998,449) E. OPENING CASH AND CASH EQUIVALENTS 317,560,062 317,422,897
F. CLOSING CASH AND CASH EQUIVALENTS 306,501,994 313,424,448
Net operating cash flow per share 31 0.02 0.06
Sd/- Sd/- Sd/- Managing Director Director Company Secretary
162
Mohammed Elias Brothers POY Manufacturing Plant Limited Notes to the Financial Statements
For the period ended 30 September, 2017 1.00 Incorporation and legal status
1.01 Company profile
The Company incorporated on 1st August 2002 under the Companies Act 1994 vide Reg. No. C-4410 of 2002 with an authorized capital of Tk. 3,000,000,000 divided into 300,000,000 ordinary shares of Tk. 10 each.
The company acquired Textile Division of Mohammad Elias Brothers (Pvt.) Ltd on 31st Dec 2009 based on financial statement for the year ended 31st Dec, 2009. The accounting for the business combination was merged as per section of uniting of interest of BAS 22 (Business Combination & uniting interest). The merger of financials were carried out under polling of interest method as per BAS 22.
by applying the pooling of interests method as per BAS 22. While applying the pooling of interest method, the financial statement items of the combining enterprises for the
period in which the combination occurred has been included in the financial statements of the combined enterprises which include vertical merger of reserve/retain earning.
The calculation of net worth was made based on the balance sheet of Textile Division of Mohammad Elias Brothers (Pvt) Ltd. as on 31.12.2009 which are as follows:
Particulars Amount in Taka
Fixed assets 188,644,175
Investment 251,970,856
Current Assets, Loan & Advance 362,854,252
a. Total Assets 803,469,283
Loan 161,234,165
Lease Liabilities 662,177
Current liabilities & Provision 138,096,235
b. Total Liability 299,992,577
Net worth (a-b) 503,476,706
Total purchase consideration paid Tk. 600,000,000 against net worth of Tk. 503,476,706. The premium value was paid considering location of Textile division within the same premises plus the extra Gas supply available with the textile division which can be used for future expansion program during this crisis period of new gas line availability. In addition, the high product reputation & higher profitability of the Textile division was also considered including many other factors.
1.02 Company's Registered office
The registered office of the company is situated at "As Salam -Tower" (7th Floor), 57, Agrabad C/A.Chittagong.
1.03 Nature of business
The initial product of the Company was only POY till Dec 2009. The forward linkage of POY (Partially oriented Yarn) is DTY (Draw Textured Yarn ). The DTY unit was procured on 31Dec 2009 and merged with the Company. Since then the company is marketing DTY. From 2010 POY is the raw materials for DTY and 100% captive consumption.
2.00 Significant accounting policies and basis of preparation of the financial statements
2.01 Corporate financial statements and reporting
The components of financial statements comprises statement of financial position, statement of comprehensive income, statement of changes in equity, statement of cash flows, notes and explanatory materials covering accounting policies.
The financial statements are prepared under the historical cost convention and in accordance with the requirements of the Companies Act, 1994, the Securities and Exchanges Rules, 1987 and other applicable laws, rules & regulations and the International Accounting Standards (IAS) and International Financial Reporting Standards (IFRS) adopted by the Institute of Chartered Accountants of Bangladesh (ICAB) as well as those standards, disclosures recommended by BFRSs and as applicable to this Company.
The management is responsible for preparing and presenting the financial statements including adequate disclosures, who approved and authorized for issue of this financial statements.
The preparation of the financial statements in conformity with the Bangladesh Accounting Standards (BAS) requires Board of Directors to make estimates and assumptions that affect the reported amounts of revenues and expenses, assets and liabilities at the date of the reporting year. Due to the inherent uncertainty involved in making estimates, actual result reported could differ from those estimates.
2.02 Principal accounting policies
The specific accounting policies selected and applied by the management for significant transactions and events that have material effect within the framework of BAS-1 “Presentation of Financial Statements”, in preparation and
163
presentation of financial statements have been consistently applied throughout the year and were also consistent with those used in earlier years.
For a proper understanding of the financial statements, these accounting policies are set out below in one place as prescribed by the BAS-1 “Presentation of Financial Statements”. The recommendations of BAS-1 “Presentation of Financial Statements” relating the format of financial statements were also taken into full consideration for fair presentation.
2.03 Fundamental accounting concepts
The financial statements have been prepared based on going concern, consistency concept, accrual concept and such other convention as required by BAS-1 “Presentation of Financial Statements” for fair presentation of financial statements.
2.04 Going concern
The Company has adequate resources to continue in operation for the foreseeable future. For this reasons the directors continue to adopt going concern basis in preparing the financial statements. The current credit facilities and resources of the Company provides sufficient fund to meet the present requirements of its existing business.
2.05 Corporate accounting standards practiced
The following Bangladesh Accounting Standards (BAS) and interpretation is applicable to the financial statements for the year under review:
BAS 1 Presentation of Financial Statements
BAS 2 Inventories
BAS 7 Statement of Cash Flows
BAS 8 Accounting Policies, Changes in Accounting Estimates and Errors
BAS 10 Events after the Balance sheet date
BAS 12 Income Taxes
BAS 16 Property, Plant and Equipment
BAS 17 Leases
BAS 18 Revenue
BAS 19 Employee Benefits
BAS 21 The Effects of Changes in Foreign Exchange Rates
BAS 23 Borrowing Costs
BAS 24 Related Party Disclosures
BAS 25 Accounting for Investment
BAS 33 Earnings per Share
BAS 37 Provisions, Contingent Liabilities and Contingent Assets
BAS 39 Financial Instrument disclosure
BAS 40 Investment Property
BFRS 5 Non-current Assets Held for Sale and Discontinued Operations
BFRS 7 Financial Instrument disclosure
BFRS 8 Operating Segments
2.06 Regulatory and legal compliance
The Company complied with requirements of the following laws:
The Companies Act, 1994;
The Income Tax Ordinance, 1984;
The Value Added Tax Act, 1991;
The Securities and Exchange Rules, 1987;
The Securities and Exchange Ordinance, 1969 and
The Securities and Exchange Commission Act, 1993 and labor laws 2006
2.07 Reporting period & Financial period
The financial period and reporting of the company covers from 01 January 2015 to 31 August 2015.
2.08 Functional and presentational (reporting) currency
The financial statements are prepared and presented in Bangladesh Currency (Taka), which is the Company's functional currency.
2.09 Recognition of property, plant & equipment
These are capitalized at cost of acquisition and subsequently stated at cost less accumulated depreciation. The cost of acquisition comprises of purchase price, including import duties and non-refundable taxes and any directly attributable cost of bringing the assets to its working condition for its intended use. Expenditure incurred after the assets have been put into operation, such as repairs and maintenance is normally charged off as revenue expenditure in the year in which it is incurred. In situation where it can be clearly demonstrated that the
164
expenditure has resulted in an increase in the future economic benefit expected to be obtained from the use of the fixed assets, the expenditure is capitalized as an additional cost of the assets.
On retirement or otherwise disposal of fixed assets, the cost and accumulated depreciation are eliminated and any gain or loss on such disposal is reflected in the statement of comprehensive income which is determined with reference to the net book value of assets and the net sales proceeds.
2.10 Revaluation of land
The Company has shown that lands were revalued by professional valuer Royal Inspection International Ltd. (ISO 9001:2000 Certified Company) Baitul Khair (3rd Floor) 48/A-B Purana Paltan, Dhaka-1000, Bangladesh as on December 2011. The company has revalued its land measuring 111.62 khatha of factory land at Kalur Ghat Heavy Industrial Area, Chittagong @ 14,500,000 per katha and 20 katha land at Cox's bazaar @ Tk. 897,520 per katha. A meeting of the directors of the company was held on 15th March, 2012 at the registred office of the company approve the above revaluation report.
2.11 Depreciation of property, plant & equipment
Depreciation on all fixed assets is computed using the reducing balance method so as to write off the assets over their expected useful life.
Depreciation of a new asset is calculated when it was available for use as intended by management as per directive of BOD.
After considering the useful life of assets as per BAS-16, “Property, Plant and Equipment”, the annual depreciation rates have been applied which is considered reasonable by the management are as follows.
Category of Assets Rates of Depreciation
Building 5% - 10%
Plant & Machinery 15% 1636440400
Furniture & Fixture 10% - 20%
Transport & Vehicles 20%
Other assets 15%
2.12 Valuation of Inventories
Inventories are valued in accordance with BAS-2 (Inventories) at the lower of cost and net realizable value. The cost of finished goods comprises raw materials, direct labor, other direct and related production overheads (based on normal capacity) and production related depreciation. Net realizable value is based on estimated selling price in the ordinary course of business less any further costs expected to be incurred to make the sale.
Category Basis of Valuation
Raw Materials Weighted average cost
Packing Materials Weighted average cost
Stores & Spares Weighted average cost
Finished Goods At Cost
2.13 Impairment of assets
An asset is impaired if its recoverable amount is below the value currently shown on the statement of financial position. Recoverable amount is taken as the higher of:
a. fair value less cost to sell (net selling price) and
b. value in use
At the end of each reporting year, the Company reviews all assets to look for any indication that an asset may be impaired as per BAS - 36: Impairment of Assets. Based on such review management considers that no indication of impairment for any assets existed on the statement of financial position date.
2.14 Cash and cash equivalents
Cash in hand and cash at banks have been considered as the cash and cash equivalents for preparation of these financial statements as there was insignificant risk of changes in value of these current assets.
2.15 Creditors and accruals
2.15.1 Trade and other payables
Liabilities are recorded at the amount payable for settlement in respect of goods and services received by the company, whether or not billed by the suppliers.
2.15.2 Liabities for Expenses
In accordance with the guidelines as prescribed by BAS-37 “Provisions, contingent liabilities and contingent assets”, provisions are recognized in the following situations:
a. when the Company has an obligation (legal or constructive) as a result of past events;
b. when it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and
c. reliable estimates can be made of the amount of the obligation.
165
2.16 Revenue recognition
In compliance with the requirements of BAS-18 "Revenue", revenue is recognized as follows:
a. The company recognizes sales when products are invoiced and dispatched to the buyers; b. Interest income on bank deposits and FDR are recognized on cash basis.
2.17 Income tax 2.17.1 Current tax
Income tax expenses comprises of current & deferred tax. Income tax expense is recognized in statement of profit or loss and other comprehensive income and accounted for in accordance with the requirements BAS 12. As per amendment 1st July, 2015, SRO no 193-Ain/Income Tax/2015 the company tax rate is 15%.
2.17.2 Deferred tax
Deferred tax is recognized on difference between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax base used in the computation of taxable profit, and are accounted for using balance sheet liability method. Deferred tax liabilities are generally recognized for all taxable temporary differences and deferred tax assets are recognized to the extent that it is probable that the profits will be available against which deductible temporary difference, unused tax loses or unused tax credits can be utilized. Such assets and liabilities are not recognized if the temporary difference arises from goodwill or from the initial recognition (other than in a business combination) of other assets and liabilities in a transaction that affects neither the taxable profit nor accounting profit.
2.18 Leasing
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessee. All other leases are classified as operating leases.
The Company as lessee
Assets held under finance leases are initially recognized as assets of the Company at their fair value at the inception of the lease or, if lower, at the present value of the minimum lease payments. The corresponding liability to the lessor is included in the statement of financial position as a finance lease obligation.
Lease payments are apportioned between finance expenses and reduction of the lease obligation so as to achieve a constant rate of interest on the remaining balance of the liability. Finance expenses are recognized immediately in profit or loss, unless they are directly attributable to qualifying assets, in which case they are capitalized in accordance with the Company's general policy on borrowing costs. Contingent rentals are recognized as expenses in the year in which they are incurred.
Operating lease payments are recognized as an expense on a straight-line basis over the lease term, except where another systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed. Contingent rentals arising under operating leases are recognized as an expense in the year in which they are incurred.
In the event that lease incentives are received to enter into operating leases, such incentives are recognized as a liability. The aggregate benefit of incentives is recognized as a reduction of rental expense on a straight-line basis, except where another systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.
2.19 Foreign currencies transaction
Foreign currency transactions are recorded in BDT at applicable rates of exchange ruling at the dates of transaction in accordance with BAS-21"The effects of changes in foreign exchange rates". Exchange difference at the financial position date are credited to statement of comprehensive income.
2.20 Employees benefit 2.20.1 Provident fund scheme The Company operates a Contributory Provident Fund Scheme for its permanent employees (who are interested
to contribute to the Scheme). The Company’s contribution to the fund is charged off as revenue expenditure during the year to which the contribution relates. The fund is operated by a Board of Trustees. All confirmed employees of the Company are contributing 6% of their basic salary as subscription to the fund. The Company contributes equal amount of the employees’ contribution. Interest earned from the investment is credited to the members account on yearly basis.
2.20.2 Worker's profit participation fund (WPPF) The company contributed 5% of net profit after charging the amount to the aforementioned fund.
2.21 Cash flow statement
The Cash Flow Statement has been prepared using direct method in accordance with the requirements of BAS 7 "Statement of cash flows" as required by the Securities and Exchange Rules 1987.
2.22 Earnings per share
The Company presents basic and diluted (when dilution is applicable) earnings per share (EPS) data for its ordinary shares. Basic EPS is calculated by dividing the profit or loss attributable to ordinary shareholders of the Company by the weighted average number of ordinary shares outstanding during the year, adjusted for the effect of change
166
in number of shares for bonus issue, share split and reverse split. Diluted EPS is determined by adjusting the profit or loss attributable to ordinary shareholders and the weighted average number of ordinary shares outstanding, for the effects of all dilutive potential ordinary shares. However, dilution of EPS is not applicable for these financial statements as there was no dilutive potential ordinary share during the relevant year.
2.23 Events after the reporting period
Events after the reporting period that provide additional information about the Company's position at the date of statement of financial position or those that indicate the going concern assumption is not appropriate are reflected in the financial statements. Events after the reporting period that are not adjusting events are disclosed in the notes when material.
2.24 Segmental reporting
No segmental reporting is applicable for the Company as required by BFRS-14 “Operating Segment” as the Company operates in a single industry segment and within a single geographical segment.
2.25 Financial assets & liabilities
Financial assets and liabilities are recognized on the statement of financial position date when the entity has become a party to a contractual provision of the instruments.
2.26 Trade Receivables
Trade receivables are stated at their real value and consider good. No provision has been made for doubtful debts and no amount was written off as bad. The Company have sale agreement with each of the buyer including promissory
notes signed by the buyer(s).
2.27 Trade Payables :
Liabilities are recorded at the amount payable for settlement in respect of goods and services received by the Company.
2.28 Related party disclosure
As per BAS-24 “Related Party Disclosures”, parties are considered to be related if one the parties have the ability to control the other party or exercise significant influence over the other party in making financial and operating decisions.
2.29 Contingent liabilities and assets
Contingent liabilities and assets are current or possible obligations or assets, arising from past events and are not within whose existence is due to the occurrence or non-occurrence of one or more uncertain future events which are not within the control of the company. In accordance with BAS - 37, they are disclosed in the note - 32 of the financial statements.
2.30 Certain accounting practices
The following expenditures are charged out revenue as and when incurred : a. Cost of office supplies, publicity materials and services on procurement.
b. Applicable accrual in respect of creditors for supplies or services is considered only at the time of the year and closing of the Company's books of account.
2.31 General
a. There was no preference share issued by the company.
b Wherever considered necessary, previous year's figures & phrases have been re-arranged to conform to this year's presentation.
c The amount in these financial statements have been rounded off to the nearest taka.
d Bracket figure denotes negative.
167
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03 PROPERTY , PLANT AND EQUIPMENT Cost / Revalued value (Note - 03.01) 3,764,264,004 3,746,584,004 Accumulated Depreciation (Note - 03.02) (1,555,356,803) (1,534,591,699)
2,208,907,201 2,211,992,305
03.01 Cost / Revalued value Opening Balance 3,746,584,004 3,724,584,004 Addition during the period 17,680,000 22,000,000
3,764,264,004 3,746,584,004
Deletion during the period - -
3,764,264,004 3,746,584,004
03.02 Accumulated depreciation Opening Balance 1,534,591,699 1,443,290,954 Charged during the period 20,765,104 91,300,745
1,555,356,803 1,534,591,699
r Details of property, plant and equipment is given in "Annexure - A". r Depreciation has not been charged on Land & Land Development.
r Fractions have been avoided in calculating depreciation of fixed assets. 04 INVESTMENTS: Investment in Fixed Deposit: Fixed Deposit at Dhaka Bank Limited 16,404,305 16,006,231
Fixed Deposit at Basic Bank Limited 944,470 944,470 Fixed Deposit at Trust Bank Limited 7,771,731 2,646,975
25,120,505 19,597,676
Break up of FDR
SL FDR No. Bank Rate of Interest
(% ) Term Maturity Principle Closing Amount
1 # 17313000006630 DBL 4.5 01 year 24.04.2017 2,130,000 2,130,000
2 # 17313000009422 DBL 4.5 01 year 14.07.2017 2,000,000 2,185,544
3 # 17313000009443 DBL 4.5 01 year 22.07.2017 2,500,000 2,731,467
4 # 17313000009464 DBL 4.5 01 year 27.07.2017 2,500,000 2,730,699
5 # 17313000009472 DBL 4.5 01 year 18.08.2017 2,500,000 2,727,475
6 # 17313000009544 DBL 4.5 01 year 07.10.2017 500,000 522,474
7 # 17313000009586 DBL 4.5 01 year 29.10.2017 1,450,000 1,512,744
8 # 17313000009632 DBL 4.5 01 year 08.11.2017 1,000,000 1,042,488
9 # 17313000009573 DBL 4.5 01 year 29.10.2017 788,000 821,413
Total 15,368,000 16,404,305
1 # 0418-01-000244 BASIC 5.5 01 year 04.01.2017 971,400 944,470
Total 971,400 944,470
1 # 0012-0330016527 TBL 5.5 01 year 03.09.2017 246,975 250,031
2 # 0012-0330022565 TBL 5.5 01 year 11.08.2017 2,400,000 2,521,700
3 # 0012-0330023386 TBL 5.5 03 months 11.10.2017 5,000,000 5,000,000
Total 7,646,975 7,771,731
Grand Total 23,986,375 25,120,505
05 DEFERRED TAX ASSETS
A. Property, plant and equipment Carrying amount (excluding revaluation reserve) 756,407,851 759,492,955
Tax base amount 1,147,010,029 1,160,465,182
Taxable temporary difference (390,602,177) (400,972,227)
Tax rate 15% 15%
Deferred tax Assets (58,590,327) (60,145,834)
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05.01 Deferred Tax Calculation Deferred tax Asset for the year 2016-2017 60,145,834 Less : Deferred tax Asset for the period ended 30.09.2017 58,590,327
Deffered tax for the period 1,555,507
06 ADVANCES, DEPOSITS AND PREPAYMENTS Advances
Advance Income Tax 21,872,088 21,813,391 Advance against Salary 603,671 637,471 Prepaid Insurance - - VAT Current Account Balance 10,294 41,396 Advance for Expenses (Note - 06.01) 2,095,082 1,805,082 L/C Margin (Note - 06.02) 1,909,345 2,765,326 Advance for Pet chips (Note - 06.03) 100,349,883 185,814,301 Advance for Spinish Finish Oil (Note - 06.04) 1,315,800 1,315,800 Advance for Conning Oil (Note - 06.05) 978,000 978,000
129,134,163 215,170,766
Deposits
Security Deposit (KGDCL) 6,095,583 6,095,583 6,095,583 6,095,583
135,229,745 221,266,349
06.01 Advance for Expenses M/S HNS Automobiles 71,000 71,000 M/S Creative Technology 275,000 275,000 M/S Akter Hossain 777 777 M/S Khawja Bricks Manufacturing 13,250 13,250 M/S Metco Construction 340,000 270,000 M/S NS Trade 1,050,000 850,000 M/S Shohag Supplies 55 55 M/S Kader Electric Engg Works 325,000 325,000 M/S CRAB 20,000 -
2,095,082
1,805,082
06.02 L/C Margin L/C No: 2355-17-01-0102 538,925 - L/C No: 2355-16-01-0066 1,370,420 - L/C No: 2355-17-01-0086 - 1,372,476
L/C No: 2355-17-01-0088 - 1,392,850
1,909,345 2,765,326
06.03 Advance for Pet chips M/S R. K Enterprise 8,699,999 34,949,999 M/S A R Trading 19,550,000 44,050,000 M/S Rashid & Brothers 22,257,000 32,457,000 M/S Monir Trading 40,771,325 48,271,325 M/S Bidco Associates 9,070,000 26,070,000 M/S Hasna Corporation 1,559 15,977
100,349,883 185,814,301
169
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06.04 Advance for Spinish Finish Oil
M/S Ju Tex Chemicales 1,315,800 1,315,800
06.05 Advance for Conning Oil
M/S Ju Tex Chemicales 978,000 978,000
07 INVENTORIES
Stores, Spares & Loose Tools (Note - 07.01) 77,314,683 78,563,739
Stock of Raw & Packing Materials (Note - 07.02) 223,225,465 289,643,883
Finished Goods- DTY ( 44,05,224 Kg) 687,193,442 617,714,395
987,733,590 985,922,017
07.01 Stores, Spares & Loose Tools
Spare Parts 58,740,030 59,331,270
Electrical Goods 47,982 108,510
Lubricants 10,510,244 10,991,495
Chemical 3,880,439 4,015,708
Bobbin 4,135,988 4,116,756
77,314,683 78,563,739
07.02 Stock of Raw & Packing Materials
Direct Raw materials (Note - 07.02.01) 146,936,676 157,661,095
Indirect Raw materials (Note - 07.02.02) 6,836,039 7,874,651
Packing materials 17,227,355 20,655,418
Work-in-process 52,225,395 103,452,720
223,225,465 289,643,884
07.02.01 Direct Raw Materials
Op e ning ( kg ) P urc has e ( kg ) C o ns ump t io n ( kg ) C lo s ing ( kg )
Pet Chips 1,684,973 1,651,210 1,650,600 1,685,583 145,559,234 154,211,918
Spin Finish Oil 12,022 - 7,536 4,486 1,191,684 3,193,585
KBB 108 - 28 80 185,758 249,992
KHH 1 - 1 - - 5,600
146,936,676 157,661,095
07.02.02 Indirect Raw materials
Opening (kg)Purchase
(kg)
Consumption
(kg)Closing (kg)
Conning Oil 50,152 6,300 9,447 47,005 6,426,055 6,961,555
Terminal Oil - - - - - -
Paper Tube ( Pcs ) 22,443 - 12,366 10,077 409,984 913,096
Stainless Steel Sand - - - - - -
6,836,039 7,874,651
r Inventories are physically verified by the management team.
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08 ACCOUNTS RECEIVABLES
M/S Monjur Hossain 73,291,749 61,013,474
Arif Traders 97,691,482 82,396,224
Yusuf Yarn Trading 83,052,979 65,106,775
Saiful Yarn Trading 72,205,096 53,776,433
Jasim & Brothers 72,272,079 63,748,077
S.K.Traders 58,954,480 72,588,074
Das Traders 75,162,470 63,612,643
BMS Traders 60,912,263 52,176,163
Kartic Das 63,504,508 80,240,656
Jemmy Enterprise 71,106,179 59,728,998
Fahim Traders 75,478,223 64,201,706
M.M. Thread 83,701,349 91,439,006
Holy Garments 62,523,013 30,735,793
SS Knitting 70,512,938 59,987,142
Pima Textile 72,928,882 57,826,036
Lamia Traders 54,777,481 64,383,143
Sakib Traders 72,692,167 20,985,762
Uro Textile 89,260,470 53,683,053
1,310,027,810 1,097,629,161
r The above amount is receivable from debtors against credit sales contract.
r All the trade debtors are considered as good.
r The debtors have issued promissory notes and personal guarantees.
r There have been receivables outstanding for the following period :
Within one months - -
Within two months 1,168,544,807 984,788,729
Within three months 141,483,003 112,840,432
Within six months - -
After six months to one year - -
1,310,027,810 1,097,629,161
09 CASH AND CASH EQUIVALENTS
Cash-in-hand (Note - 09.01) 305,555,488 310,072,256
Cash at Bank (Note - 09.02) 946,506 7,487,805
306,501,994 317,560,062
09.01 Cash-in-hand
Agrabad Office 305,525,711 310,025,708
Dhaka Office 4,531 8,850
Factory 25,246 37,698
305,555,488 310,072,256
09.02 Cash at Bank
Dutch Bangla Bank Limited, Muradpur Branch,C/D A/C-9614 232,125 18,641
Dutch Bangla Bank Limited, Agrabad Branch,C/D A/C-31173 4,656 1,757
Dhaka Bank Limited, Ktj. Branch,C/D A/C-3898 - 99,556
BASIC Bank Limited, Khatungonj Branch, CD A/C 0410-01-0000437 - -
Trust Bank Limited, Agrabad Branch, CD A/C 3688 635,083 7,302,735
Social Islami Bank Limited, Khatungonj Branch, CD A/C 00016755 2,168 2,168
Jamuna Bank Limited, Agrabad Branch,CD A/C 005-0210015389 - -
Janata Bank Limited,CD A/C 101100135-4 7,410 7,410
BASIC Bank Limited, Khatungonj Branch, CD A/C 0421 3,558 3,558
BRAC Bank Limited, Agrabad Branch, CD A/C 1101200-312299001 38 38
Islami Bank Bangladesh Limited, Khatungonj Branch, CD A/C 275008 14,470 14,470
Dutch-Bangla Bank Limited, Muradpur Branch, CD A/C 9711 584 584
BRAC Bank Limited, Agrabad Branch, CD A/C 1101200-952439001 28,525 28,525
Bank Asia Ltd , Khatungonj Br. CD-5522 2,570 2,585
City Bank Ltd , Agrabad Br. CD-1101454951001 1,310 1,310
NCCBL , Agrabad Br. CD-0003-0210027234 4,470 4,470
Meghna Bank , Agrabad Br. CD-210111100000274 4,540 -
Midland Bank , Agrabad Br. CD-0003-0210027234 5,000 -
946,506 7,487,805
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10 Taka Taka
Authorized Capital
30,00,00,000 ordinary shares of Tk.10 each 3,000,000,000 3,000,000,000
Issued, Subscribed and Paid-up Capital
16,80,00,000 Ordinary Shares of Tk.10 each fully paid 1,680,000,000 1,680,000,000
10.01 Position of Share holding
No. of % of Share No. of % of Share
Shares Holding Shares Holding
Sponsors & Directors 51,369,652 30.58 65,209,680 38.82
Other than sponsors & Directors 116,630,348 69.42 102,790,320 61.18
168,000,000 100 168,000,000 100
10.02 Range of Share holding
No. of No. of No. of No. of
Shareholders Shares Shareholders Shares
Less than 5000 shares. - - - -
5,001 to 50,000 shares 8 158,000 8 158,000
50,001 to 100,000 shares 14 814,240 14 814,240
100,001 to 200,000 shares 17 2,121,280 17 2,121,280
200,001 to 300,000 shares 2 476,000 2 476,000
300,001 to 400,000 shares 4 1,388,800 4 1,388,800
400,001 to 500,000 shares 0 - 0 -
500,001 to 1,000,000 shares 8 4,508,000 8 4,508,000
1,000,001 to 10,000,000 shares 23 86,293,680 23 86,293,680
Over 10,000,000 shares 4 72,240,000 4 72,240,000
80 168,000,000 80 168,000,000
10.03 Shareholding position by the Sponsors & Directors:
Sydul Karim Chairman 6920014
Mohd. Rezaul Karim Managing Director & Sponsor 6920014
Mohammad Abrar Hossain Director 7787619
Mohd. Asfaq Hossain Director 7899618
Mohd. Asrar Hossain Director 7787619
Mohd. Shamsul Alam Sponsor 2603966
Mohd. Nurul Absar Sponsor 1497384
Mohd. Nurul Alam Sponsor 1497384
Mohd. Khurshed Alam Sponsor 2603967
Mohd. Murshed Alam Sponsor 2604067
Mohd. Aminul Karim Sponsor 3248000
Total 51369652
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Taka Taka
11 RETAINED EARNINGS
Opening Balance 563,564,030 462,924,740
Comprehensive income during the period 57,258,574 111,757,914
Prior year adjustment for Provision for Tax - (11,118,625) 620,822,604 563,564,030
DesignationName
30 June 2017
30 Sept. 2017 30 June 2017
30 Sept. 2017
No of Share holding
172
30 Sept. 2017 30 June 2017
Taka Taka
12 LONG TERM BANK LOAN
Trust Bank Ltd. A/C-0012-0660001230 37,778,950 41,259,921
Trust Bank Ltd. A/C-0012-0660001294 137,035,866 140,592,665
Trust Bank Ltd. A/C-0012-0660001301 40,584,699 42,392,759
Trust Bank Ltd. A/C-0012-0660001338 167,726,045 169,618,421
Trust Bank Ltd. A/C-0012-0660001347 150,430,745 146,682,200
Trust Bank Ltd. A/C-0012-0660001356 36,941,717 36,021,176
570,498,021 576,567,142
Due within one year 101,750,000 101,750,000
Due after one year 468,748,021 474,817,142
570,498,021 576,567,142
Break up of Term Loan
Term Loan 53,984,183 1,500,000 48 10.00% 29.09.2015
Term Loan 162,273,751 3,500,000 60 10.00%
Term Loan 45,056,976 950,000 60 10.00% 31.03.2016
Term Loan 165,433,973 3,500,000 60 10.00% 26.12.2016
Term Loan 145,030,464 4,700,000 36 10.00% 21.05.2017
Term Loan 35,615,554 1,150,000 36 10.00%
Nature of Security
(i) Post dated cheques
(ii) Personal guarantee by each Director.
(iii) Fixed deposit receipts
(iv)
(v) Pari-Passu 2nd charge registered with RJSC over all present & future fixed & floating assets.
(vi) Registered mortgage with Irrevocable Ganarel Power of Attorney on 416.55 decimals land & building
13 LEASE LIABILITIES
Industrial and Infrastructrue Development Finance Co. Ltd. A/C-LF#16744/2014-0-2 41,826,308 41,106,278
Industrial and Infrastructrue Development Finance Co. Ltd. A/C-LF#031/2007-0-2 37,673,784 36,683,776
Premier Leasing & Finance Limited A/C-LFM-0683 98,291,383 94,707,181
Phoenix Finance & Investments Limited A/C-PLC/CTG-05/EL-15/05 12,921,138 12,481,360
190,712,613 184,978,595
Financial lease obligations are as follows:
Less than 1 year 64,507,428 64,507,428
Between 1 – 5 years 126,205,185 120,471,167
190,712,613 184,978,595
Break up of Lease Liabilities :
Facility Reschedule
Date Rete of Interest
Lease 04.01.2017 17%
Syn.Lease 04.01.2017 17%
Syn.Lease 04.01.2017 17%
Syn.Lease 15.12.2012 20%
Nature of Security
(i) Post dated cheques
(ii) Personal guarantee by each Director.
(iii) Demand promissory note
(iv) Machinery in the name of Syndicate lessors
(v) Corporate guarantee
Limit as per
sanction
advice
Sanction/Renewal
date Tenure (Month)Bank Name Installment
LF#16744/2014-0-2IIDFC Ltd.
IIDFC Ltd.
Phoenix
Finance & 24,810,929
39,931,733
PLC/CTG-05/EL-15/05
Premier
Leasing
Rate of Interest as
per sanction advice
LF#031/2007-0-2
LF#0683
35,631,301
DP Note, Letter of continuity, Letter of arrangement, Letter of revival, Letter of trust receipts, Letter of Loan agreement.
Trust Bank Limited, A/C # 1338
21.05.2017
Trust Bank Limited, A/C # 1230
Trust Bank Limited, A/C # 1347
31.03.2016Trust Bank Limited, A/C # 1294
Trust Bank Limited, A/C # 1301
1,043,129
2,701,614
461,850
90,773,657
Reschedule
AmountInstallment
1,169,026
Particulars
Trust Bank Limited, A/C # 1356
Agreement no.
Facility
173
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Taka Taka
14 SHORT TERM LOAN
Dhaka Bank Limited, Khatungonj Branch, Chittagong
STL No: 017TLOT171720001 26,170,050 26,529,439
- -
26,170,050 26,529,439
Trust Bank Limited, Agrabad Branch, Chittagong
Bank Overdraft A/C # 518 40,946,045 36,992,786
LTR # 48457 7,285,748 16,680,640
LTR # 48500 9,693,916 9,464,148
LTR # 48537 9,693,005 9,463,258
LTR # 48591 18,621,762 18,180,383
LTR # 48626 12,286,646 11,995,424
LTR # 48733 12,430,337 12,120,589
LTR # 48804 10,222,020 9,967,300
LTR # 48886 10,251,658 9,996,200
LTR # 48920 12,159,182 -
LTR # 49063 12,200,700 -
LTR # 49090 15,594,537 -
171,385,556 134,860,728
197,555,606 161,390,167
r Purpose :To Import / procure different raw materials , Spare parts for production of Poy, DTY units.
r Sanction Limit: 30 Crore.
r Rate of Interest : 13.5%
r Tenure :1 Year.
r Security :Hypothecation along with IGPA,1st charge on entire Fixed & floating assets of MEB poy and
Register Mortgage of Land.
15 ACCOUNTS PAYABLES
M/S J International 415,450 415,050
M/S Ju Tex Chemical Mills Ltd 815,569 767,129
M/S Karnaphuli Enterprise 5,945,801 4,377,847
M/S Maintenance Chemical 92,750 114,750
M/S Tasmia Accessories 1,359,714 1,122,609
M/S Tasmia Traders 668,917 690,153
M/S Azad Store 399,975 400,050
M/S Bengal Printers 34,750 31,700
M/S Bismillah Bearing 415,213 340,533
M/S Bismillah Auto Electric 92,830 29,000
M/S Faria Trading 296,000 320,000
M/S Hazi Mohd Islam Khan 97,500 97,500
M/S HT Traders 863,898 1,293,292
M/S Mizan Enterprise 85,641 85,641
M/S SK Electric 71,102 71,102
M/S Kalam Engineering Works 16,901 68,901
M/S Tect. Tasla Technology 35,000 -
M/S Kashem Brothers 1,564,674 1,366,390
M/S FT Engineering Champion Filter 42,632 -
M/S Rumman Spring & Eng. 98,925 98,925
M/S Bangladesh Salt Crushing Co. 5,000 -
M/s Munir Supply 17,762 17,762
M/S Pethon Shah Electric 18,440 18,440
M/S Antora Fire Foa International 15,540 15,540
M/S Real Biz 31,621,249 32,779,299
M/S Jalal Uddin 119,362,541 99,362,541
M/S Hasna Corporation 6,455,094 8,955,094
M/S Hasna Associates 766,529
M/S Friends Corporation 20,093 20,093
M/S Amara Corporation 51,022,772 54,291,536
M/S Shaibal Enterprise 38,400 -
222,756,660 207,150,876
There have been payables outstanding for the following period :
Within two months 96,453,634 85,346,161
Within three months 126,303,026 121,804,715
Above three months - -
222,756,660 207,150,876
All Trade payable are Goods purpose .
174
30 Sept. 2017 30 June 2017
Taka Taka
16 OTHER PAYABLES
M/S L & M Builders Ltd. 513,508 348,503
M/S Abdur Rahman & Sons 437,780 441,299
M/S Anchor Refregeration 979 28,995
M/S Soatil Restaurant 134,900 62,740
M/S Dana Eng. 199,315 199,315
M/S Farzana Traders 713,980 712,600
M/S A.H. Trading 115,593 115,593
M/S Hasna Mawla Enterprise 4,080 4,080
M/S Island Trading Corporation 108,156 98,380
M/S Khan Engr. 132,000 132,000
M/S Khawja Azmiri Filter 46,800 46,800
M/S M.A.Taiab & Sons 22,500 22,500
M/S Mitali Stone 31,473 31,473
M/S Mir Filling Station 829,940 5,023
M/S Intertrade Management Service Ltd 842,369 935,792
M/s Purabi International C&F 165,043 165,043
M/S Rayhan Motors 82,600 82,600
M/S Kazi & Sons 228,000 228,000
M/S Everfirst Tec. Ltd 84,000 56,000
M/S Hasan Imam Chy. 2,200,000 2,200,000
M/S B M Enterprise 1,000 1,000
M/S Biswas Engineering & AC Equipment 87,000 112,000
M/S Sunrise Engineering Works 18,000 -
M/S Halda Enterprise 16,900 16,900
M/S Malek Electric Works - 8,000
M/S Metaconnect - 65,000
M/S Nation Boiler House 10,916 10,916
M/S Power Trade eng. & Filteration - 37,600
M/S Shah Amanat Traders 76,544 28,064
M/S Shah Jalal Traders 3,160 -
M/S Idris Meah 3,540 3,540
M/S Nur Mohammad 168,660 122,122
7,278,736 6,321,878
There have been other payables outstanding for the following period :
Within two months 6,339,779 5,411,528
Within three months 924,399 714,372
Above three months 14,557 195,978
7,278,736 6,321,878
r All others payable are service purpose.
30 Sept. 2017 30 June 2017
Taka Taka
17 LIABILITIES FOR EXPENSES
Salary and Wages 3,943,495 3,331,345
Gas Charges 13,663,674 12,293,270
Provident Fund 1,652,554 1,404,738
Source tax deductions 4,378,745 4,314,237
VAT on office rent payable 818,745 728,174
VAT payable on sales 1,408,108 -
Overtime 646,759 465,210
Telephone Bill 46,162 27,998
Office Rent 3,852,767 2,896,740
Audit Fee 450,000 250,000
Union Fee 15,570 13,550
Professional fees 883,000 1,021,000
Provision for maintanance of machinary 440,000 440,000
32,199,578 27,186,263
All Liabilities for expenses are subsequently paid .
175
30 Sept. 2017 30 June 2017
18 PROVISION FOR INCOME TAX Taka Taka
Opening Balance 6,804,000 1,935,072
Provision made for the period 3,400,933 5,613,582
10,204,934 7,548,655
Less. Deposit (6,804,000) (744,654)
3,400,933 6,804,000
18.01 PROVISION MADE FOR THE YEAR
Profit before contribution to WPPF 71,419,600 117,885,225
5% of Net profit before tax after charging the contribution to WPPF 3,400,933 5,613,582
r
r
19 PROVISION FOR INCOME TAX
Opening Balance 47,651,104 33,295,657
Provision made for the period (Note - 26) 9,204,586 13,143,849
56,855,690 46,439,506
Prior year tax paid (2,312,245) (15,000,000)
Adjustment - AIT (156,374) (237,027)
Advance Income Tax for Income Year- 2009,2010,2011( Tribunal 10% ) - 5,330,000
Transfer from Retained Earnings - 11,118,625
54,387,071 47,651,104
01 July 2017 to 30
Sept 2017
01 July 2016 to 30
Sept. 2016 Taka Taka
20 SALES (Net of VAT)
Sales 290,392,517 159,932,830
Less: VAT (2,251,500) (1,276,060)
288,141,017 158,656,770
r Item Quantity(Kg.) Value (Tk.)
DTY 1,501,000 290,392,517
21 COST OF GOODS SOLD
Direct Raw Materials Consumed (Note: 21.01) 144,609,998 52,721,967
Indirect Raw Materials (Note: 21.02) 1,794,612 1,638,059
Factory Overhead (Note: 21.03) 47,549,182 46,444,726
Factory Cost 193,953,791 100,804,752
Opening Stock of Work in Process 103,452,720 63,572,350
297,406,511 164,377,102
Qty (kg/ltr) Rate in Tk. 297,406,511 164,377,102
Closing Stock of Work in Process (52,225,395) (93,572,350)
Cost of Production 1,571,723 156.00 245,181,116 70,804,752
Opening Stock of Finished Goods 4,334,501 142.51 617,714,395 574,582,620
Cost of Goods available for Sales 5,906,224 862,895,511 645,387,372
Closing Stock of Finished Goods 4,405,224 156.00 (687,193,442) (551,547,220)
1,501,000 175,702,069 93,840,152
21.01 Direct Raw Materials Consumed
Pet Chips : Qty (kg/ltr) Rate in Tk.
Opening Stock 1,684,973 154,211,918 177,233,191
Purchases 1,651,210 81.08 133,885,579 50,943,041
Available for Consumption 3,336,183 86.36 288,097,497 228,176,232
Closing Stock 1,685,583 (145,559,234) (176,546,733)
1,650,600 86.36 142,538,263 51,629,499
Spin Finish Oil :
Opening Stock 12,022 3,193,585 7,517,489
Purchases - - - -
Available for Consumption 12,022 265.65 3,193,585 7,517,489
Closing Stock 4,486 (1,191,684) (6,436,513)
7,536 2,001,901 1,080,976
Accordence with the section 234 of Bangladesh Labor Act, 2006 as amended in 2013; 5% of net profit before tax after changing
transfer to the contribution to WPPF. This amount distributed to participation fund , Wellfare fund & Labor wellfare
foundation fund in the proportion of 80:10:10 are respectively.
The company has been provided @ 5% of net profit before tax after charging the contribution to WPPF as per provision of
the Bangladesh labor code 2006 and payable to workers as defined in the said law.
176
30 Sept. 2017 30 June 2017
Taka Taka
Opening Stock 108 249,992 254,758
Purchases
Available for Consumption 108 2314.74 249,992 254,758
Closing Stock 80 (185,758) (243,266)
28 64,234 11,492
KHH
Opening Stock 1 5,600 -
Purchases
Available for Consumption 1 5600.00 5,600 -
Closing Stock - - -
1 5,600 -
144,609,998 52,721,967
21.02 Indirect Raw Materials Consumed
Conning Oil
Opening Stock 50,152 6,961,555 7,978,575
Purchases 6,300 120.00 756,000 604,800
Available for Consumption 56,452 136.71 7,717,555 8,583,375
Closing Stock 47,005 (6,426,055) (7,349,883)
9,447 1,291,500 1,233,492
Terminal Oil
Opening Stock - - 576,189
Purchases - - -
Available for Consumption - - 576,189
Closing Stock - - (432,142)
- - 144,047
Paper Tube
Opening Stock 22,443 913,096 1,952,275
Purchases - - -
Available for Consumption 22,443 40.69 913,096 1,952,275
Closing Stock 10,077 (409,984) (1,692,480)
12,366 503,112 259,795
Stainless Steel Sand
Opening Stock - - 2,900
Purchases - -
Available for Consumption - - 2,900
Closing Stock - - (2,175)
- - 725
1,794,612 1,638,059
21.03 Factory Overhead
Salaries & Allowances ( Officer) 1,197,052 1,992,051
Wages & Allowances 3,656,886 3,784,302
Bonus (including worker's bonus) 1,036,735 877,909
Overtime 1,767,846 1,825,447
Gas Charges 13,942,106 10,689,233
Insurance Premium 609,375 365,625
Maintenance (Note:21.03.01) 168,950 116,490
Store and Spare Parts Used (Note:21.03.02) 4,146,883 3,587,781
Pick-up Expenses 13,150 -
Labor Charges 61,481 149,205
Medical Expenses 240 1,530
Depreciation (Note : 03.02) 20,765,104 22,825,186
Staff fooding 181,795 227,451
Newspaper & Periodicals 1,580 2,516
47,549,182 46,444,726
21.3.1 Maintenance
Machinery 60,289 15,577
Painting & White Wash - -
Factory Building 39,060 30,485
Air conditioner - -
Generator 51,455 60,000
Electrical 3,146 428
Cargo Lift - 10,000
Fire Exting - -
Deep Tubewell 15,000 -
168,950 116,490
177
30 Sept. 2017 30 June 2017
Taka Taka
21.3.2 Store and Spare Parts Used
Spare Parts
Opening Stock 59,331,270 55,836,138
Purchases 590,767 159,260
Available for Consumption 59,922,037 55,995,398
Closing Stock (58,740,030) (54,608,215)
1,182,007 1,387,183
Electrical Goods
Opening Stock 108,510 147,615
Purchases 130,625 48,224
Available for Consumption 239,135 195,839
Closing Stock (47,982) (43,283)
191,153 152,556
Lubricants
Opening Stock 10,991,495 10,870,902
Purchases 573,540 572,000
Available for Consumption 11,565,035 11,442,902
Closing Stock (10,510,244) (10,817,070)
1,054,791 625,832
Chemical
Opening Stock 4,015,708 4,065,668
Purchases 122,200 44,000
Available for Consumption 4,137,908 4,109,668
Closing Stock (3,880,439) (3,984,203)
257,469 125,465
Bobbin
Opening Stock 4,116,756 26,657
Purchases 1,480,695 1,391,938
Available for Consumption 5,597,451 1,418,595
Closing Stock (4,135,988) (121,850)
1,461,463 1,296,745
4,146,883 3,587,781
22 ADMINISTRATIVE EXPENSES
Salary and Allowance (Officer) 2,535,547 2,396,579
Staff salary & other benefits 1,416,792 1,803,055
Bonus 304,210 600,865
Service Benefits 325,686 64,973
Registration & Renewal 78,850 99,606
Travelling 11,550 108,496
Conveyance 44,479 59,063
Stationery 67,266 43,733
Postage, Stamps & Courier Services 903 1,305
Entertainment 229,721 208,560
Maintenance (Note: 22.01) 77,210 129,220
Rest House Maintenance 200,702 227,199
Donation & Subscription 21,000 68,782
Office Rent 1,096,915 997,089
Common Service Bill 15,000 15,000
Telephone Bill 18,164 21,575
Mobile Bill 24,000 31,300
Directors' Board Attendance Fees 15,000 15,000
Dish Line Expenses 800 1,050
Generator Bill 13,816 47,384
Fuel & Oil ( Vehicle ) 483,840 246,211
Audit fee 200,000 165,000
Electricity Charges 136,189 87,343
Internet Bill 4,945 6,276
Misc. Expenses 470,980 786,958
Annual Picnic - 21,360
Bank Charges (all bank) (Note:22.02) 76,331 35,173
Bank Charges on FDR (Note:22.03) 8,500 6,000
7,878,396 8,294,154
The Managing Director and all Directors did not draw any Remuneration since 2014.
178
30 Sept. 2017 30 June 2017
Taka Taka
22.01 Maintenance
Vehicle 73,810 93,400
Furniture - 6,000
Computer 3,400 29,820
77,210 129,220
22.02 Bank Charges (all bank)
Amount (TK.)
200
66,881
2,877
1,610
Meghna Bank 460
Bank Asia 15
4,288
Total 76,331
22.03 Bank Charges on FDR
SL Amount (TK.)
1 1,500
2 1,500
3 1,500
4 1,500
5 2,500
Total 8,500
23 SELLING AND DISTRIBUTION EXPENSES
Pick-up Expenses 38,900 5,150
Packing Materials Used (Note:23.01) 6,356,122 2,927,282
6,395,022 2,932,432
23.01 Packing Materials Used
Opening Stock 20,655,418 15,827,315
Purchases 2,928,059 1,106,350
Available for Consumption 23,583,477 16,933,665
Closing Stock (17,227,355) (14,006,383)
6,356,122 2,927,282
24 FINANCIAL EXPENSES
Interest expenses (Note:24.02) 15,587,106 9,251,838
Overdue Interest on Lease Finance 11,812,218 4,588,735
27,399,324 13,840,573
24.02 Interest expenses
SL Amount (TK.)
1 240,167
2 1,041,940
4 989,029
5 3,443,201
7 4,257,624
10 3,748,545
11 920,541
8 946,059
Total 15,587,106
25 NON OPERATING INCOME
Misc. Income (Note:25.01) 63,028 75,660
Interest earned from FDR (Note:25.02) 590,366 571,608
653,394 647,268
Trust Bank Ltd.
Term Loan # 0012-0660001347
Time Loan # 06600001301
CD-31173
Dutch-Bangla Bank Ltd
Dutch-Bangla Bank Ltd
Trust Bank Ltd.
CD-0274
CD-9614
Term Loan # 0012-0660001356
A/C Number
CD-3688
STL # 017STLE142710001
Bank Name
OD-518
FDR A/C Number
Dhaka Bank Ltd.
SL. No.
02
FDR # 9472
Loan A/C Number
Time Loan # 06600001338
Trust Bank Ltd. Time Loan # 06600001294
Time Loan # 06600001230
Trust Bank Ltd.
FDR # 9464
Bank Name
Dhaka Bank Ltd.
FDR # 9443
OD# 518
Trust Bank Ltd.
Trust Bank Ltd.
Trust Bank Ltd.
Dhaka Bank Ltd.
11
01 Trust Bank Ltd.
Trust Bank Ltd.
12
Bank Charges by Cash
Bank Name
Trust Bank Ltd.
Dhaka Bank Ltd.
FDR # 9422
Dhaka Bank Ltd.
CD-5522
FDR # 22565
179
25.01 Misc. Income
SL. No. Amount (TK.)
1 14,028
2 15,000
3 34,000
Total 63,028
25.02 Interest earned from FDR
SL. No. Amount (TK.)
1 94,586
2 118,197
3 118,163
4 118,024
5 138,000
TDS 3,396
Total 590,366
30 Sept. 2017 30 June 2017
Taka Taka
26 INCOME TAX
Profit before tax as per Comprehensive Income Statement 68,018,667 38,473,074
Add: Accounting Depreciation 20,765,104 22,825,186
88,783,771 61,298,260
Less: Tax Depreciation as per 3rd Schedule 27,419,867 29,915,503
Taxable Profit 61,363,904 31,382,757
Current period income tax provision @ 15% on taxable profit 9,204,586 4,707,413
27 EARNINGS PER SHARE
Net profit after tax 57,258,574 32,702,113
Divided by number of ordinary shares outstanding for the period (Note: 27.01) 168,000,000 168,000,000
Earning per share 0.34 0.19
27.01 Weighted Average Number of Share
01 July 2017 to 30
Sept 2017
01 July 2016 to 30
Sept. 2016
Share at the beginning 168,000,000 168,000,000
Bonus share - -
168,000,000 168,000,000
r
30 Sept. 2017 30 June 2017
28 NET ASSET VALUE PER SHARE ( with Revaluation Reserve ) Taka Taka
Total Assets 5,032,111,172 4,914,113,405 Total outside liabilities (1,278,789,218) (1,218,050,024)
Net assets 3,753,321,954 3,696,063,381
Outstanding ordinary shares 168,000,000 168,000,000
22.34 22.00
NET ASSET VALUE PER SHARE ( without Revaluation Reserve )
Total Assets 5,032,111,172 4,914,113,405
Revaluation surplus (1,452,499,350) (1,452,499,350)
Total Assets ( Excluding Revaluation Reserve ) 3,579,611,822 3,461,614,055
Total outside liabilities (1,278,789,218) (1,218,050,024)
Net assets 2,300,822,604 2,243,564,031
Outstanding ordinary shares 168,000,000 168,000,000
13.70 13.35 0 1 July 2 0 17 t o 3 0
S e p t 2 0 17
0 1 July 2 0 16 t o 3 0
S e p t . 2 0 16
Taka Taka
29 RECEIPTS FROM CUSTOMERS
Opening Book debts 1,097,629,161 751,999,979
Sales during the year 290,392,517 159,932,830
1,388,021,678 911,932,809
Closing book debts (1,310,027,810) (744,236,120)
77,993,868 167,696,689
FDR # 9472
FDR # 9422
Income from Scale
Reject Drum
Dhaka Bank Ltd.
Product (weighted average Nos. of share)
Particulars
Wastage sale
Dhaka Bank Ltd.
A/C Number
FDR # 9464
Dhaka Bank Ltd.
168,000,000
Earning per share is calculated in accordance with BAS 33 '' Earning Per Share" which has been shown on the face of
Statement of Comprehensive Income.
168,000,000
Dhaka Bank Ltd.
Total
Particulars
Bank Name
Nos of
FDR # 9443
Share
Dhaka Bank Ltd.
Trust Bank Ltd. FDR # 22565
-
180
01 July 2017 to 30
Sept 2017
01 July 2016 to 30
Sept. 2016
Taka Taka
30 PAYMENTS TO SUPPLIER, EMPLOYEES & OTHERS
Cost of goods sold (175,702,069) (93,840,152)
Operating expenses (14,273,418) (11,226,586)
Depreciation 20,765,104 22,825,186
Inventories (1,811,572) (113,912,451)
Advances, deposits and pre-payments 86,036,604 (19,416,708)
Liabilities for expenses 5,013,315 (4,041,240)
VAT paid (2,251,500) (1,276,060)
WPPF Paid (6,804,000) -
AIT adjustment (156,374) (85,255)
Other payable 956,858 (26,980,824)
Trade payable 15,605,784 90,126,492
(72,621,268) (157,827,598)
31
3,713,749 10,516,359
168,000,000 168,000,000
0.02 0.06
32 CONTINGENT LIABILITIES AND COMMITMENTS
COMMITMENTS
Liabilities under guarantees and immature letters of credit not acknowledged as debts :
Guarantee to Karnafuli Gas Distribution Co Ltd. 7,568,000 5,168,000
Benapol Custom 170,000 170,000
Commitment under immature letters of credit 18,348,395 8,887,612
26,086,395 14,225,612
CONTINGENCY
Tax status upto 22.10.2017
Tax
Provision
Tax Claimed
by NBRTax Rate AIT Payment Tax Payment
Net Payable /
(Credit)Remarks
8,374,215 5,000 15% 116,571 8,487,700 (8,599,271) Tribunal completed
19,265,986 13,038,249 15% 781,375 19,984,620 (7,727,746) Tribunal completed
11,854,362 35,379,277 15% 1,547,259 13,907,200 19,924,818 Tribunal completed
14,355,032 57,930,386 15% 1,415,239 12,940,000 43,575,147 Assessment
completed
25,750,686 61,361,110 15% 954,986 9,560,000 50,846,124 Assessment
completed
17,251,686 87,538,290 15% 273,208 - 87,265,082 Assessment
completed
12,603,678 Assessment
under 15% 223,968 - 12,379,710 Return submitted
33 EMPLOYEE POSITION
Head Office Factory Head Office Factory
- - - - -
263 24 64 - 175
263 24 64 - 175
34 CAPACITY & PRODUCTION
** Actual production consist of Poy & DTY.
b) Weighted Average Number of Outstanding Ordinary Shares
OPERATING CASH FLOW PER SHARE
POY / DTY
2015-2016
2011-2012
Total
EmployeeSalary Range ( Monthly)
Assessment
Year
2012-2013
Worker & Employee
2010-2011
a) Operating cash inflow/ (outflow) during the period
2,216,326 10,500,000 22.62%
Installed capacity per annum in
kg
Licensed capacity per
annum in kg
9,800,000
% of capacity
utilization
2013-2014
Particulars
Below 3,000
For the year ended
Above 3,000
Actual production
in kg
2016-2017
Officers & Staff
2014-2015
The composition of operating cash inflow/outflow value per share is given below :
181
30 Sept. 2017 30 June 2017
Taka Taka
35 CIF VALUE OF IMPORTED MATERIALS, CAPITAL MACHINERY & SPARE PARTS
CIF value of import
Pet Chips 45,917,221 35,978,220
Spin Finish Oil - -
Paper Tube - -
45,917,221 35,978,220
36 RELATED PARTY TRANSACTIONS
Directors Officers
Payments
Board meeting attendance fee 15,000
Basic - 1,866,300
Company's contribution to P / F - 111,978
Bonus - 804,567
Total 15,000 2,782,845
Perquisites
House Rent - 933,150
Dearness Allowance - 559,890
Transport - 167,967
Medical - 93,315
Meals & Entertainment - 229,721
Mobile Bill - 24,000
- 2,008,043
Total 15,000 4,790,888
37
SL Position Meeting held Attendance
1 Sydul Karim Chairman 1 1
2 Mohd. Rezaul Karim Managing Director 1 1
3 Mohammad Abrar Hossain Director 1 1
4 Mohd. Asfaq Hossain Director 1 1
5 Mohd. Asrar Hossain Director 1 1
01 July 2017 to 30
Sept 2017
01 July 2016 to 30
Sept. 2016
Taka Taka
38 200,000 165,000
200,000 165,000
39 AUTHORIZATION FOR ISSUE
40 EVENTS AFTER FINANCIAL POSITION DATE
r
The Board of Directors in its meeting held on 19 November,2017approved the accounts for this period ended Sept. 30, 2017.
i) The rate at which Directors have drawn Board meeting attendance fees @ Tk. 3000/- per Director per meeting. The total Board
meeting attendance fee incurred during the period under review was Tk. 15,000/- and
The aggregate amount paid / provided during the period in respect of " Directors " and " Officers " of the Company as defined in
the Securities and Exchange Commission Rules 1987 are disclosed below :
During the period from 01 July 2017 to 30 Sept. 2017, there were 01 ( one ) Board meeting held. The attendance status of
all the meetings are as follows :
Name of the Directors
AUDITOR'S REMUNERATION- Para 6 of Schedule XI, Part II- note 21
ATTENDANCE STATUS OF BOARD MEETING OF DIRECTORS
ii) no amount of money was spent by the company for compensating any member of the board for special services rendered.
Total
No material events had occurred after the reporting period to the date of issue of these financial statements, which could
affect the values stated in the fianancial statements.
182
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183
(b) Information as is required under section 186 of the †Kv¤úvwb AvBb, 1994 relating to holding company;
The Company has no holding Company. So this is not applicable for the issuer.
(c) Selected ratios as specified in Annexure-D;
2015 2014 2013 2012
(i) 4.01 4.21 3.72 3.29 3.22 3.20 1.42
(ii) 2.56 2.63 2.15 2.00 1.67 1.84 0.86
II. Operating Efficinecy Ratios:
(i) 0.24 0.75 0.18 1.95 1.57 2.34 2.64
(ii) 0.18 0.47 0.05 1.07 0.67 1.66 2.87
(iii) 0.06 0.15 0.03 0.26 0.17 0.29 0.33
(i) 39.02 34.90 64.97 20.97 30.88 23.68 17.59
(ii) 34.07 28.22 51.27 17.40 26.56 16.44 11.60
(iii) 19.87 16.04 24.46 8.73 18.77 12.44 5.93
(iv) 1.15 2.35 0.72 2.23 3.27 3.58 1.94
(v) 1.53 3.02 0.91 2.70 3.77 4.25 2.43
(vi) 0.34 0.67 0.20 0.57 0.78 0.84 0.52
(vii) 0.41 0.41 0.88 0.27 0.41 0.26 0.20
(i) 0.25 0.25 0.22 0.21 0.16 0.14 0.21
(ii) 0.34 0.33 0.28 0.26 0.19 0.16 0.26
(iii) 3.58 2.46 2.41 2.54 6.91 3.85 2.68
(iv) 0.25 0.48 0.15 0.32 0.38 0.41 0.31
(i) 0.02 0.15 0.09 0.09 0.52 (1.70) 0.68
(ii) 0.06 0.23 0.46 0.15 0.67 (2.01) 1.31
Sd/-Ahmed Zaker & Co. Place: Chittagong
Chartered Accountants Dated: 10 Dec 2017
We have examined the calculation of the above ratios of Mohammed Elias Brothers Poy Manufacturing Plant Limited for the period
ended September 30, 2017,for the year ended June 30, 2017 & for the period ended June 30, 2016 and for the year ended December 31,
2015, 2014, 2013, & 2012 and are found them correct.
Debt Service Coverage Ratio.
Net operating Cash flow per share
(NOCFPS); and
NOCFPS to EPS Ratio".
V. Cash Flow Ratios:
Times Interest Earned Ratio; and
Debt to Equity Ratio;
Debt to Total Assets Ratio;
Accounts Receivables turnover ratio;
Asset turnover ratio.
Gross Margin Ratio;
Operating Profit Ratio;
Net Profit Ratio;
Earnings before interest, taxes, depreciation
and amortization (EBITDA) margin.
Earnings Per Share ratio (EPS); and
Return on Equity Ratio;
Return on Assets Ratio;
IV. Solvency Ratios:
III. Profitability Ratios:
Inventory turnover ratio; and
Mohammed Elias Brothers Poy Manufacturing Plant Limited
Auditor Certificate regarding Statement of Ratio Analysis
Name of ratio30
September
30 June
2017
30 June
2016
Result
Current ratio; and
Quick ratio.
We have examined the following earnings per share (EPS) and other ratios of Mohammed Elias Brothers Poy Manufacturing Plant
Limited for the period ended September 30, 2017,for the year ended June 30, 2017 & for the period ended June 30, 2016 and for the
year ended December 31, 2015, 2014, 2013, & 2012 which have been produced by the management of the Company and provided to
us. The preparation of the EPS and the other ratios is the responsibility of the Company’s management. Our responsibility is to
review them and certify as to whether they have been properly prepared using stated principle on the basis of audited consolidated
and stand alone financial statements for the period ended September 30, 2017,for the year ended June 30, 2017 & for the period ended
June 30, 2016 and for the year ended December 31, 2015, 2014, 2013, & 2012 . Based on the review, we certify that the Company has
properly prepared the following EPS and other ratios using stated principles on the basis of audited consolidated and stand alone
financial statements for the period ended September 30, 2017,for the year ended June 30, 2017 & for the period ended June 30, 2016
and for the year ended December 31, 2015, 2014, 2013, & 2012 . Ratios pertinent to the prospectus are as specified in rule 4 (1) (d) /
Annexure D of the Bangladesh Securities and Exchange Commission (Public Issue) Rules, 2015.
1. Liquidity Ratios:
184
(d) Auditors report under Section 135(1), Para 24(1) of Part II of Schedule III of the †Kv¤úvwb AvBb, 1994. The report shall include
comparative income statements and balance sheet and aforementioned ratios for immediate preceding five accounting
years of the issuer. If the issuer has been in commercial operation for less than five years, the above mentioned inclusion
and submission will have to be made for the period since commercial operation;
Mohammed Elias Brothers POY Manufacturing Plant Limited
Auditors’ Report under Section-135(I), Para 24(I), of Part-II of Schedule III to the Companies Act 1994 as required under Section-135(I), Para 24(I), of Part-II of Schedule III to the Companies Act 1994, management of Mohammed Elias Brothers POY Manufacturing Plant Limited has prepared the following statements of its stand alone and consolidated assets and liabilities, profit and loss accounts and cash flows for the period ended September 30, 2017 & June 30, 2016 and for the year ended June 30, 2017 and December 31, 2015, 2014, 2013, & 2012 and submitted those to us for working and issuance of our confirmation thereon. We, as the auditors of the Company, having examined the stand alone financial statements of the Company for the period ended September 30, 2017 & June 30, 2016 and for the year ended June 30, 2017 and December 31, 2015, 2014, 2013, & 2012, hereby confirm that the following information has been correctly extracted from those audited financial statements. Financial statements for the period ended September 30, 2017 & June 30, 2016 and for the year ended June 30, 2017 were audited by us. Financial statements for the year ended December 31, 2015, 2014 ,2013 & 2012 were audited by Rahman Mostafa Alam & Co. Chartered Accountants. In pursuance of section 135(1) under paragraph 24(1) of part II of the Third schedule of the Companies Act 1994 our report is as under:
30.09.2017 30.06.2017 30.06.2016 31.12.201531.12.2015 31.12.2014 31.12.2013 31.12.2012
ASSETS
Non-current assets 2,292,618,033 2,291,735,815 2,361,838,880 2,412,995,529 2,444,386,032 2,363,291,114 3,017,663,004
Property, plant and equipment, net 2,208,907,201 2,211,992,305 2,281,293,050 2,330,483,714 2,348,853,302 2,263,918,856 2,242,120,552
Investment 25,120,505 19,597,676 16,703,099 16,497,859 25,160,498 23,147,861 700,091,358
Deferred tax assets 58,590,327 60,145,834 63,842,731 66,013,956 70,372,232 76,224,397 75,451,094
Current assets 2,739,493,139 2,622,377,589 2,241,869,485 2,091,588,084 1,671,828,696 1,506,586,182 1,041,397,434
Advances, deposits and prepayments 135,229,745 221,266,349 222,302,159 230,894,126 255,923,683 182,116,272 65,968,625
Inventories 987,733,590 985,922,017 945,793,874 821,359,670 804,369,935 641,356,324 406,529,930
Trade receivables 1,310,027,810 1,097,629,161 756,350,554 728,976,643 399,982,690 487,308,156 487,097,084
Other receivables - - - - - - 80,236,553
Current tax receivable - - - - - - -
Cash and Cash Equivalents 306,501,994 317,560,062 317,422,898 310,357,645 211,552,388 195,805,430 1,565,242
Total assets 5,032,111,172 4,914,113,404 4,603,708,365 4,504,583,613 4,116,214,728 3,869,877,296 4,059,060,438
EQUITY AND LIABILITIES
Capital and reserves 3,753,321,954 3,696,063,379 3,595,424,090 3,562,527,858 3,466,922,433 3,336,367,634 3,221,350,703
Share capital 1,680,000,000 1,680,000,000 1,680,000,000 1,680,000,000 1,680,000,000 1,680,000,000 1,500,000,000
Share money deposit - - - -
Share money deposit - - - - - - -
Revaluation surplus 1,452,499,350 1,452,499,350 1,452,499,350 1,452,499,350 1,452,499,350 1,452,499,350 1,452,499,350
Retained earnings 620,822,604 563,564,029 462,924,740 430,028,508 334,423,083 203,868,284 268,851,353
Liabilities
Non-current Liability 594,953,206 595,288,309 405,275,208 306,332,196 129,311,929 63,285,379 102,650,100
Long term portion of term loan 468,748,021 474,817,142 285,924,156 196,449,047 15,270,000 8,727,644 -
Deferred tax liability - - - - - - -
N0n interest bearing loan - - - - - - -
Long term portion of lease liabilities 126,205,185 120,471,167 119,351,052 109,883,149 114,041,929 54,557,735 102,650,100
Current liabilities 683,836,012 622,761,717 603,009,066 635,723,559 519,980,366 470,224,283 735,059,635
Current portion of long term loan 101,750,000 101,750,000 180,000,000 128,490,000 143,516,595 15,231,126 24,430,362
Current portion of lease liabilities 64,507,428 64,507,428 66,150,972 66,150,984 54,177,948 83,779,568 85,231,482
Short term borrowings 197,555,606 161,390,167 195,226,781 324,714,972 258,271,447 308,858,500 324,146,244
Trade payables 222,756,660 207,150,876 101,658,139 52,533,745 7,320,843 6,916,303 229,979,581
Other payables 7,278,736 6,321,878 4,975,143 5,417,229 7,574,781 6,276,174 7,667,328
Provision for expenses 32,199,578 27,186,263 19,767,302 22,881,572 22,107,447 24,600,850 21,595,745
Provision for contribution to W.P.P.F 3,400,933 6,804,000 1,935,072 5,649,424 7,682,933 7,450,571 8,867,009
Provision for income tax 54,387,071 47,651,104 33,295,657 29,885,633 19,328,371 17,111,191 33,141,884
Total liabilities 1,278,789,218 1,218,050,025 1,008,284,275 942,055,755 649,292,295 533,509,662 837,709,735
Total equity and liabilities 5,032,111,172 4,914,113,404 4,603,708,365 4,504,583,613 4,116,214,728 3,869,877,296 4,059,060,438
Net Assets Value Per Share With Assets Revaluation 22.34 22.00 21.40 21.21 20.64 19.86 21.48
- - - - - - 19.17
13.70 13.35 12.76 12.56 11.99 11.21 11.79
- - - - - - 10.53
1. Statement of Assets and liabilities:
Amount in Taka
Net Assets Value Per Share With Assets Revaluation (Restated)
Net Assets Value Per Share Without Assets Revaluation
Net Assets Value Per Share Without Assets Revaluation (Restated)
185
2. Statement of Operating Result:
30.09.2017 30.06.2017 30.06.2016 31.12.201531.12.2015 31.12.2014 31.12.2013 31.12.2012
Sales 288,141,017 696,935,855 134,465,796 1,099,540,460 695,644,043 1,141,286,124 1,321,188,973
Cost of goods sold (175,702,069) (453,684,333) (47,101,289) (869,015,159) (480,818,559) (871,076,427) (1,088,825,788)
Gross profit 112,438,948 243,251,522 87,364,506 230,525,301 214,825,484 270,209,697 232,363,185
(41,672,741) (126,681,334) (47,118,695) (114,910,085) (57,302,500) (131,502,942) (137,618,467)
Administrative expenses (7,878,396) (34,857,137) (15,393,666) (32,977,535) (27,794,928) (60,439,577) (54,414,594)
Selling & distribution expenses (6,395,022) (11,729,031) (3,030,021) (6,249,759) (2,257,553) (22,098,405) (24,650,236)
Financial expense (27,399,324) (80,095,166) (28,695,008) (75,682,791) (27,250,019) (48,964,960) (58,553,637)
Operating profit 70,766,206 116,570,188 40,245,811 115,615,216 157,522,984 138,706,755 94,744,718
Non operating income 653,394 1,315,035 390,711 3,022,699 3,818,601 41,548,051 8,481,951
Operating profit before contribution to W.P.P.F 71,419,600 117,885,223 40,636,522 118,637,915 161,341,585 180,254,806 103,226,669
Provision for W.P.P.F (3,400,933) (5,613,582) (1,935,072) (5,649,424) (7,682,933) (8,583,562) (4,915,555)
Profit before tax 68,018,667 112,271,641 38,701,449 112,988,491 153,658,652 171,671,244 98,311,114
Income tax expenses (10,760,094) (513,729) (5,805,217) (16,961,954) (23,103,852) (29,728,922) (19,978,810)
Current tax expense (9,204,587) 3,183,168 (3,633,992) (12,603,678) (17,251,686) (25,750,686) (14,355,032)
Deferred tax expense (1,555,507) (3,696,897) (2,171,225) (4,358,276) (5,852,165) (3,978,236) (5,623,778)
Profit for the year 57,258,574 111,757,912 32,896,232 96,026,537 130,554,800 141,942,322 78,332,304
Other comprehensive income - - - - - (26,925,390) 6,604,839
Total Comprehensive Income for the year 57,258,574 111,757,912 32,896,232 96,026,537 130,554,800 115,016,932 84,937,143
Earning per Share (EPS) Basic-Reported 0.34 0.67 0.20 0.57 0.78 0.84 0.52
Earning per Share (EPS) Basic-Restated - - - - - - 0.47
3. Dividend Declared :
Cash - - - - - - -
Bonus - - - - - - 12%
Amount in Taka
4. Statement of Cash Flows:30.09.2017 30.06.2017 30.06.2016 31.12.201531.12.2015 31.12.2014 31.12.2013 31.12.2012
A) Cash flows from operating activities
Receipts from customers 77,993,868 360,455,228 108,381,244 778,177,823 787,473,761 1,141,075,053 1,192,064,290
Payment to suppliers, employees & others (72,621,268) (320,820,876) (93,771,263) (840,676,383) (690,006,066) (1,436,999,497) (1,094,393,295)
Receipts from non-operating income 653,394 1,315,035 390,711 3,022,699 3,818,601 41,548,051 5,871,051
Income taxes paid (2,312,245) (15,000,000) - (1,773,208) (14,079,520) (30,500,000) (800,000)
Net cash (used in)/ generated by operating activities 3,713,749 25,949,388 15,000,692 (61,249,069) 87,206,776 (284,876,393) 102,742,046
B) Cash flows from investing activities
Purchase of property,plant & equipment (17,680,000) (22,000,000) - (89,018,546) (183,570,527) (132,523,300) (11,889,965)
Sale of fixed assets - - - - - - 17,950,400
Increase/Decrease in investment (5,522,829) - (205,240) 8,662,639 (2,012,637) 676,943,497 (12,000,116)
Net cash (used in)/ generated by investing activities (23,202,830) (22,000,000) (205,240) (80,355,907) (185,583,164) 544,420,197 (5,939,681)
C) Cash flows from financing activities
Increase/Decrease in short term loan 36,165,439 (33,836,614) (129,488,191) 66,443,525 (50,587,053) (15,287,744) 666,090
Increase/Decrease in long term loan (6,069,120) 110,642,985 140,985,110 166,152,452 134,827,825 (471,592) (31,178,668)
Increase/Decrease in non interest bearing loan - - - - - - (600,000,000)
Increase in share capital - - - - - - 495,750,000
Lease payment/Receipts 5,734,018 (523,429) 9,467,891 7,814,256 29,882,574 (49,544,279) (55,169,937)
Increase/Decrease in Share money deposit - - -
Interest Paid (27,399,324) (80,095,166) (28,695,008) - - - -
Dividend paid - - - - (13,957,200)
Net cash (used in)/ generated by financing activities 8,431,013 (3,812,224) (7,730,199) 240,410,233 114,123,346 (65,303,616) (203,889,715)
D) Net increase in cash and cash equivalents (A+B+C) (11,058,068) 137,164 7,065,253 98,805,257 15,746,958 194,240,188 (107,087,350)
E) Cash and cash equivalents at the beginning of the year 317,560,062 317,422,898 310,357,645 211,552,388 195,805,430 1,565,242 108,652,592
F) Cash and cash equivalents at the end of the year (D+E) 306,501,994 317,560,062 317,422,898 310,357,645 211,552,388 195,805,430 1,565,242
Net Operating Cash Flow per Share-Reported 0.02 0.15 0.09 (0.36) 0.52 (1.70) 0.68
Net Operating Cash Flow per Share-Restated - - - - - - 0.61
1 Dividend declared 20% cash against the amount of share capital and 800% bonus share against ordinary shares as per record date 28th of July,2011.
2 The Company was incorporated on 1st August, 2002;
3 The Statement of Assets and Liabilities (Statement of Financial Position) as at September 30, 2017, June 30,2017 and June 30, 2016 of the Company has been duly certified by us;
4
5
6 The Company has no subsidiaries;
7 No proceeds or part of proceeds of the issue of shares were applied directly or indirectly by the Company in the purchase of any other business;
8 The Company did not prepare any financial statements for any period subsequent to June 30, 2017 except period from 01 January 2016 to 30 June 2016 and 01 July 2017 to 30 September 2017.
9 Net Asset Value Per Share, Earning per Share (EPS) Basic and Net Operating Cash Flow per Share has been re-stated on the basis of current no of share as on September 30, 2017.
10 Figures related to previous years have been rearranged whenever considered necessary.
Sd/-
Ahmed Zaker & Co. Place: Chittagong
Chartered Accountants Dated: 10 Dec 2017
Point to be noted:
The Statement of Operating Results (Statement of Profit or Loss and other Comprehensive Income) for the period ended September 30, 2017 & June 30, 2016 and for the year ended
The Statement of Cash Flows for the period ended September 30, 2017 & June 30, 2016 and for the year ended June 30, 2017 of the Company are enclosed certified by us;
Amount in Taka
186
(e) Financial spread sheet analysis for the latest audited financial statements;
Financial spread sheet analysis for the latest audited financial statements;
Mohammad Elias Brothers POY Manufacturing Plant Limited
Statement of Financial Position
As at September 30, 2017
Particulars Amount Percentage (%) Grand Percentage
ASSETS
NON-CURRENT ASSETS 2,292,618,033 45.56%
Property, Plant and Equipment (net of depreciation) 2,208,907,201 43.90%
Investments 25,120,505 0.50%
Deferred Tax Assets 58,590,327 1.16%
CURRENT ASSETS 2,739,493,139 54.44%
Advances, Deposits and Pre-payments 135,229,745 2.69%
Inventories 987,733,590 19.63%
Trade Receivables 1,310,027,810 26.03%
Cash and Cash Equivalents 306,501,994 6.09%
Total Assets 5,032,111,172 100.00%
EQUITY & LIABILITY
SHAREHOLDERS’ EQUITY 3,753,321,954 74.59%
Share capital 1,680,000,000 33.39%
Revaluation surplus 1,452,499,350 28.86%
Retained earnings 620,822,604 12.34%
NON- CURRENT LIABILITIES 594,953,206 11.82%
Long term portion of term loan 468,748,021 9.32%
Long term portion of lease liabilities 126,205,185 2.51%
CURRENT LIABILITIES 683,836,012 13.59%
Current portion of term loan 101,750,000 2.02%
Current portion of lease liabilities 64,507,428 1.28%
Short term loan 197,555,606 3.93%
Trade payables 222,756,660 4.43%
Other payables 7,278,736 0.14%
Liabilities for expenses 32,199,578 0.64%
Provision for contribution to WPPF 3,400,933 0.07%
Provision for income tax 54,387,071 1.08%
TOTAL LIABILITIES 1,278,789,218 25.41%
TOTAL EQUITY & LIABILITIES 5,032,111,172 100.00%
Sd/- Sd/- Sd/- Sd/- Md. Mozaffor Ahmed
Company Secretary
Md. Shahidullah Khan
Chief Financial Officer
Mohd. Rezaul Karim
Director & Managing Director
Sydul Karim
Chairman
187
Mohammad Elias Brothers POY Manufacturing Plant Limited
Statement of Profit and Loss and Other Comprehensive Income
For the Period Ended September 30, 2017
Particulars Year Ended June 30, 2017 Percentage on Total Turnover Grand Percentage
Sales Revenue 288,141,017 100.00%
Total Revenue 288,141,017 100%
Less: Cost of Goods Sold 175,702,069 60.98%
Opening Stock of Raw Materials 165,535,746 57.45%
Add: Purchase 134,641,579 46.73%
Less: Closing stock of raw material 153,772,715 53.37%
Materials Consumed 146,404,610 50.81%
Add: Factory overhead 47,549,182 16.50%
Cost of manufacturing 193,953,792 67.31%
Add: Opening work-in-process 103,452,720 35.90%
Less: Closing work-in-process 52,225,395 18.12%
Cost of goods manufactured 245,181,117 85.09%
Add: Opening stock of finished goods 617,714,395 214.38%
Less: Closing stock of finished goods 687,193,442 238.49%
Gross profit 112,438,948 39.02%
Less: Administrative & selling expenses 14,273,418 4.95%
Operating profit 98,165,530 34.07%
Add: Other income 653,394 0.23%
Less: Financial Expenses 27,399,324 9.51%
Net Profit before tax & WPPF 71,419,600 24.79%
Less: WPPF 3,400,933 1.18%
Net Profit before Tax 68,018,667 23.61%
Less: Income Tax Expenses 10,760,093 3.73%
Net Profit after Tax 57,258,574 19.87%
Sd/- Sd/- Sd/- Sd/- Md. Mozaffor Ahmed
Company Secretary Md. Shahidullah Khan Chief Financial Officer
Mohd. Rezaul Karim Director & Managing Director
Sydul Karim Chairman
(f) Earnings Per Share (EPS) on fully diluted basis (with the total existing number of shares) in addition to the weighted average number of shares basis. Future projected Net Income should not be considered while calculating the weighted average EPS;
As per audited financial statement as at September 30, 2017
Particulars Amount in BDT
Net profit after Tax 57,258,574
No. of shares before IPO 168,000,000
Earnings per Share 0.34
(g) All extra-ordinary income or non-recurring income coming from other than core operations should be shown separately while showing the Net Profit as well as the Earnings Per Share;
As per audited financial statement as at September 30, 2017
Particulars Amount in BDT
Net profit after Tax 57,258,574
Less: Non-Operating Income 653,394
Net profit excluding Non-Operating Income 56,605,180
No. of shares 168,000,000
Earnings per Share (EPS) 0.336
188
(h) Quarterly or half-yearly EPS should not be annualized while calculating the EPS;
As per audited financial statement as at September 30, 2017
Particulars Amount in BDT
Net profit after Tax 57,258,574
No. of shares before IPO 168,000,000
Earnings per Share 0.34
(i) Net asset value (with and without considering revaluation surplus or reserve) per unit of the securities being offered at the date of the latest audited statement of financial position.
Net Assets Value (NAV) with Revaluation Surplus As per audited financial statement as at September 30, 2017
Particulars Amount in BDT
Share Capital 1,680,000,000
Revaluation Surplus 1,452,499,350
Retained Earnings 620,822,604
Total Shareholders’ Equity 3,753,321,954
Total Number of Ordinary Share 168,000,000
Net Assets Value (NAV) with Revaluation Surplus 22.34
Net Assets Value (NAV) without Revaluation Surplus As per audited financial statement as at September 30, 2017
Particulars Amount in BDT
Share Capital 1,680,000,000
Retained Earnings 620,822,604
Total Shareholders’ Equity 2,300,822,604
Total Number of Ordinary Share 168,000,000
Net Assets Value (NAV) without Revaluation Surplus 13.70
(j) The Commission may require the issuer to re-audit the audited financial statements, if any deficiency or anomaly is found in the financial statements. In such a case, cost of audit should be borne by the concerned issuer.
This information is not applicable for us.
(k) Following statements for the last five years or any shorter period of commercial operation certified by the auditors: -
189
(i) Statement of long term and short term borrowings including borrowing from related party or connected persons with rate of interest and interest paid/accrued;
Name of PartyNature of
Relationship
Nature of
Borrowing
Balance as at 30
September, 2017 Interest Rate
Interest Paid,
(BDT)
Inte re s t
A c c rue d,
(B D T)
Trust Bank Limited-1230 Lender Long Term 37,778,950 10% 989,029 -
Trust Bank Limited-1294 Lender Long Term 137,035,866 10% 3,443,201 -
Trust Bank Limited-1301 Lender Long Term 40,584,699 10% 1,041,940 -
Trust Bank Limited-1338 Lender Long Term 167,726,045 10% 4,257,624 -
Trust Bank Limited-1347 Lender Long Term 150,430,745 10% 3,748,545 -
Trust Bank Limited-1356 Lender Long Term 36,941,717 10% 920,541 -
Sub Total 570,498,022 14,400,880 Nil
Indus tria l a nd Infra s truc true De ve lopme nt Fina nc e Co. Ltd A/C- LF#16744/2014- 0- 2 Lender Finance Lease 41,826,308 17% -
Industrial and Infrastructrue Development Finance Co. Ltd A/C-LF#031/2007-0-2 Lender Finance Lease 37,673,784 17% -
Premier Leasing & Finance Limited A/C-LFM-0683 Lender Finance Lease 98,291,383 17% -
Phoenix Finance & Investments Limited A/C-PLC/CTG-05/EL-15/05 Lender Finance Lease 12,921,138 20% -
Sub Total 190,712,613 11,812,218 Nil
Dhaka Bank Limited,Khatungonj Branch Lender Short Term 26,170,050 10% 240,167 -
Trust Bank Limited Agrabad Branch Lender Short Term 171,385,556 13.5% 946,059 -
Sub Total 197,555,606 1,186,226 Nil
Grand Total 958,766,241 27,399,324 Nil
Name of PartyN a ture o f
R e la t io ns hip
N a ture o f
B o rro wing
B a la nc e a s a t 3 0
J une , 2 0 17 Inte re s t R a te
Inte re s t P a id ,
(B D T)
Inte re s t
A c c rue d,
(B D T)
Trust Bank Limited, A/C # 1230 Lender Long Term 41,259,921 10% 5,048,202 -
Trust Bank Limited, A/C # 1294 Lender Long Term 140,592,665 10% 16,048,487 -
Trust Bank Limited, A/C # 1301 Lender Long Term 42,392,759 10% 4,718,950 -
Trust Bank Limited, A/C # 1338 Lender Long Term 169,618,421 10% 8,669,448 -
Trust Bank Limited, A/C # 1347 Lender Long Term 146,682,200 10% 1,651,736 -
Trust Bank Limited, A/C # 1356 Lender Long Term 36,021,176 10% 405,622 -
Trust Bank Limited, A/C # 1034 Lender Long Term - 10% 3,143,713
Trust Bank Limited, A/C # 8152 Lender Long Term - 10% 402,025
Trust Bank Limited, A/C # 1249 Lender Long Term - 10% 12,933,864
Trust Bank Limited, A/C # 8161 Lender Long Term - 10% 445,249
Sub Total 576,567,142 53,467,296 Nil
Indus tria l a nd Infra s truc ture De ve lopme nt Fina nc e Co. Ltd. A/C- LF#16744/2014- 0- 2 Lender Finance Lease 41,106,278 17% -
Industrial and Infrastructure Development Finance Co. Ltd. A/C-LF#031/2007-0-2 Lender Finance Lease 36,683,776 17% -
Premier Leasing & Finance Limited A/C-LFM-0683 Lender Finance Lease 94,707,181 17% -
Phoenix Finance & Investments Limited A/C-PLC/CTG-05/EL-15/05 Lender Finance Lease 12,481,360 20% -
Sub Total 184,978,595 18,354,941 Nil
Dhaka Bank Limited,Khatungonj Branch Lender Short Term 26,529,439 10% 5,289,505 -
Trust Bank Limited Agrabad Branch Lender Short Term 134,860,728 13.5% 2,983,424 -
Sub Total 161,390,167 8,272,929 Nil
Grand Total 922,935,903 80,095,166 Nil
Name of PartyN a ture o f
R e la t io ns hip
N a ture o f
B o rro wing
B a la nc e a s a t 3 0
J une , 2 0 16 Inte re s t R a te
Inte re s t P a id ,
(B D T)
Inte re s t
A c c rue d,
(B D T)
Trust Bank Ltd. A/C-0012-0660001301 Lender Long Term 46,216,310 10.50% 1,209,334 -
Trust Bank Ltd. A/C-0012-0660001294 Lender Long Term 166,429,178 10.50% 4,355,427 -
Trust Bank Ltd. A/C-0012-0660001034 Lender Long Term 34,231,841 10.50% 2,314,181 -
Trust Bank Ltd. A/C-0012-0660001230 Lender Long Term 54,196,719 10.50% 3,047,910 -
Trust Bank Ltd. A/C-0012-0660001249 Lender Long Term 164,850,108 10.50% 5,062,556 -
Trust Bank Ltd. A/C-0012-0660001025 Lender Long Term - 10.50% 1,464,451
Sub Total 465,924,156 17,453,859 Nil
Indus tria l a nd Infra s truc ture De ve lopme nt Fina nc e Co. Ltd. A/C- LF#16744/2014- 0- 2 Lender Finance Lease 42,719,073 17% -
Industrial and Infrastructure Development Finance Co. Ltd. A/C-LF#031/2007-0-2 Lender Finance Lease 36,088,537 17% -
Premier Leasing & Finance Limited A/C-LFM-0683 Lender Finance Lease 91,229,935 17% -
Phoenix Finance & Investments Limited A/C-PLC/CTG-05/EL-15/05 Lender Finance Lease 15,464,479 20% -
Sub Total 185,502,024 9,467,891 Nil
Dhaka Bank Limited,Khatungonj Branch Lender Short Term 24,239,759 10% - -
Trust Bank Limited Agrabad Branch Lender Short Term 170,987,022 13.5% 1,667,985 -
Sub Total 195,226,781 1,667,985 Nil
Grand Total 846,652,961 28,589,735 Nil
18,354,941
For the Preiod ended June 30, 2016
9,467,891
Auditors certificate regarding Long Term and Short Term Borrowings with rate of interest and interest paid/accrued
Based on our scrutiny of the relevant financial statement of Mohammed Elias Brothers Poy Manufacturing Plant Limited. which have been prepared by management and produced
to us for review, we certify that as per the disclosure provided in those financial statements, the Company has taken the following long term and short term borrowings during the
For the Preiod ended September 30, 2017
For the Preiod ended June 30, 2017
11,812,218
190
N a m e o f P a rtyN a ture o f
R e la t io ns hip
N a ture o f
B o rro wing
B a la nc e a s 3 1
D e c e m be r, 2 0 15 Inte re s t R a te
Inte re s t P a id ,
(B D T)
Inte re s t
A c c rue d,
(B D T)
Trust Bank Ltd. A/C-0012-0660001230 Lender Long Term 55,448,810 12% 1,764,626 -
Trust Bank Ltd. A/C-0012-0660001070 Lender Long Term - 12% 8,870,831
Trust Bank Ltd. A/C-0012-0660001249 Lender Long Term 170,437,552 12% 5,418,758 -
Trust Bank Ltd. A/C-0012-0660001034 Lender Long Term 47,517,660 13.5% 10,502,342 -
Trust Bank Ltd. A/C-0012-0660001025 Lender Long Term 51,535,026 13.5% 11,205,549 -
Brac Bank A/C-9032 Lender Long Term - 14% 404,416
Sub Total 324,939,048 38,166,522 Nil
Indus tria l and Infras truc ture Develo pment F inance Co . Ltd. A/C-LF# 16744/2014-0-2 Lender Finance Lease 42,719,073 17% -
Indus tria l and Infras truc ture Develo pment F inance Co . Ltd. A/C-LF# 031/2007-0-2 Lender Finance Lease 36,088,537 17% -
Premier Leasing & Finance Limited A/C-LFM-0683 Lender Finance Lease 82,681,610 17% -
Phoenix Finance & Investments Limited A/C-PLC/CTG-05/EL-15/05 Lender Finance Lease 14,544,913 20% -
Sub Total 176,034,133 29,501,784 Nil
Dhaka Bank Limited,Khatungonj Branch Lender Short Term 24,239,759 14% 4,259,701 -
Trust Bank Limited Agrabad Branch Lender Short Term 300,475,213 13.5% 3,507,417 -
Sub Total 324,714,972 7,767,118 Nil
Grand Total 825,688,153 75,435,424 Nil
For the Year ended 31 December, 2014
N a m e o f P a rtyN a ture o f
R e la t io ns hip
N a ture o f
B o rro wing
B a la nc e a s 3 1
D e c e m be r, 2 0 14 Inte re s t R a te
Inte re s t P a id ,
(B D T)
Inte re s t
A c c rue d,
(B D T)
BRAC Bank A/C 439032 Lender Long Term 8,613,759 14% 1,645,872 -
Trust Bank Ltd. A/C-1025 Lender Long Term 28,627,256 14.5% 8,470,149 -
Trust Bank Ltd. A/C-1070 Lender Long Term 121,545,580 14.5% 4,416,997 -
Sub Total 158,786,595 14,533,018 Nil
Indus tria l and Infras truc ture Develo pment F inance Co . Ltd. A/C-LF# 16744/2014-0-2 Lender Finance Lease 42,683,551 17% -
Indus tria l and Infras truc ture Develo pment F inance Co . Ltd. A/C-LF# 031/2007-0-2 Lender Finance Lease 107,481,522 17% -
Phoenix Finance & Investments Limited A/C-PLC/CTG-05/EL-15/05 Lender Finance Lease 18,054,804 13% -
Sub Total 168,219,877 - Nil
Dhaka Bank Limited,Khatungonj Branch Lender Short Term 34,597,857 14% 6,804,110 -
Dutch Bangla Bank Limited,Muradpur Branch Lender Short Term - 15% 902,460
Trust Bank Limited Agrabad Branch Lender Short Term 223,673,590 13.5% 4,501,129 -
Sub Total 258,271,447 12,207,699 Nil
Grand Total 585,277,919 26,740,717 Nil
For the Year ended 31 December, 2013
N a m e o f P a rtyN a ture o f
R e la t io ns hip
N a ture o f
B o rro wing
B a la nc e a s 3 1
D e c e m be r, 2 0 13 Inte re s t R a te
Inte re s t P a id ,
(B D T)
Inte re s t
A c c rue d,
(B D T)
BRAC Bank A/C-9032 Lender Long Term 16,359,082 14% 3,379,228 -
Dutch Bangla Bank Limited A/C-60001 Lender Long Term - 15% 399,688
Dutch Bangla Bank Limited A/C-40001 Lender Long Term 7,599,688 16% 1,941,545 -
Sub Total 23,958,770 5,720,461 Nil
Indus tria l and Infras truc ture Develo pment F inance Co . Ltd. A/C-LF# 16744/2014-0-2 Lender Finance Lease 36,397,324 17% -
Industrial and Infrastructure Development Finance Co. Ltd. A/C-LF#031/2007-0-2 Lender Finance Lease 84,849,083 17% -
Phoenix Finance & Investments Limited A/C-PLC/CTG-05/EL-15/05 Lender Finance Lease 15,890,096 13% -
IDLC A/C-02010901701 Lender Finance Lease 1,200,800 16% -
Sub Total 138,337,303 - Nil
Dhaka Bank Limited,Khatungonj Branch Lender Short Term 33,650,507 16% 8,022,660 -
Trust Bank Limited Agrabad Branch Lender Short Term 275,207,993 13.50% 34,984,089 -
Sub Total 308,858,500 43,006,749 Nil
Grand Total 471,154,573 48,727,210 Nil
For the Year ended 31 December, 2012
Name of PartyNature of
Relationship
Nature of
Borrowing
Balance as 31
December, 2012 Interest Rate
Interest Paid,
(BDT)
Inte re s t
A c c rue d,
(B D T)
BRAC Bank A/C-39031 Lender Long Term 24,430,362 13% 5,664,423 -
Sub Total 24,430,362 5,664,423 Nil
Indus tria l and Infras truc ture Develo pment F inance Co . Ltd. A/C-LF# 16744/2014-0-2 Lender Finance Lease 43,354,720 17% -
Indus tria l and Infras truc ture Develo pment F inance Co . Ltd. A/C-LF# 031/2007-0-2 Lender Finance Lease 105,566,712 17% -
Premier Leasing & Finance Limited A/C-LFM-0683 Lender Finance Lease 34,970,172 13.5% -
Phoenix Finance & Investments Limited A/C-PLC/CTG-05/EL-15/05 Lender Finance Lease 1,348,218 16% -
IDLC A/C-02010901701 Lender Finance Lease 2,641,760 16% -
Sub Total 187,881,582 133,720 Nil
Dhaka Bank Limited,Khatungonj Branch Lender Short Term 42,427,746 17% 7,500,696 -
Dutch Bangla Bank Limited,Muradpur Branch Lender Short Term 19,942,950 15% 6,330,575 -
Trust Bank Limited Agrabad Branch Lender Short Term 261,775,548 13.50% 37,578,309 -
Sub Total 324,146,244 51,409,580 Nil
Grand Total 536,458,188 57,207,723 Nil
Sd/-Ahmed Zaker & Co. Place: Chittagong
Chartered Accountants Dated: 10 Dec 2017
For the Year ended 31 December, 2015
29,501,784
133,720
191
(ii) Statement of principal terms of secured loans and assets on which charge have been created against those loans with names of lenders, purpose, sanctioned amount, rate of interest, primary security, collateral/other security, re-payment schedule and status;
Particulars 30-Sep-17 30-Jun-17 30-Jun-16 31-Dec-15 31-Dec-14 31-Dec-13 31-Dec-12
Names of lenders
Purpose
Primary Security, Collateral / Other Security
Sanctioned Amount (Tk.)
Rate of Interest 10.00% 10.00% 10.50% 13.50% 12% 12% 13.50%
Re-payment schedule
Status (Outstanding balance Tk.) 741,883,578 711,427,870 636,911,178 625,414,261 373,846,426 275,207,993 261,775,548
Particulars 30-Sep-17 30-Jun-17 30-Jun-16 31-Dec-15 31-Dec-14 31-Dec-13 31-Dec-12
Names of lenders
Purpose
Primary Security, Collateral / Other Security
Sanctioned Amount (Tk.)
Rate of Interest 10.00% 10.00% 10.00% 14.00% 14.00% 16.00% 17.00%
Re-payment schedule
Status (Outstanding balance Tk.) 26,170,050 26,529,439 24,239,759 24,239,759 34,597,857 33,650,507 42,427,746
Particulars 30-Sep-17 30-Jun-17 30-Jun-16 31-Dec-15 31-Dec-14 31-Dec-13 31-Dec-12
Names of lenders
Purpose
Primary Security, Collateral / Other Security
Sanctioned Amount (Tk.)
Rate of Interest - - - - 14.00% 14.00% 13.00%
Re-payment schedule
Status (Outstanding balance Tk.) - - - - 8,613,759 16,359,082 24,430,362
Particulars 30-Sep-17 30-Jun-17 30-Jun-16 31-Dec-15 31-Dec-14 31-Dec-13 31-Dec-12
Names of lenders
Purpose
Primary Security, Collateral / Other Security
Sanctioned Amount (Tk.)
Rate of Interest - - - - - 15.00% 15.00%
Re-payment schedule
Status (Outstanding balance Tk.) - - - - - 7,599,688 19,942,950
Particulars 30-Sep-17 30-Jun-17 30-Jun-16 31-Dec-15 31-Dec-14 31-Dec-13 31-Dec-12
Names of lenders
Purpose
Primary Security, Collateral / Other Security
Sanctioned Amount (Tk.)
Rate of Interest 20.00% 20.00% 20.00% 20.00% 13.00% 13.00% 16.00%
Re-payment schedule
Status (Outstanding balance Tk.) 12,921,138 12,481,360 15,464,479 14,544,913 18,054,804 15,890,096 1,348,218
Particulars 30-Sep-17 30-Jun-17 30-Jun-16 31-Dec-15 31-Dec-14 31-Dec-13 31-Dec-12
Names of lenders
Purpose
Primary Security, Collateral / Other Security
Sanctioned Amount (Tk.)
Rate of Interest 17.00% 17.00% 17.00% 17.00% 17.00% 17.00% 17.00%
Re-payment schedule
Status (Outstanding balance Tk.) 79,500,092 77,790,054 78,807,610 78,807,610 150,165,073 121,246,407 148,921,432
Particulars 30-Sep-17 30-Jun-17 30-Jun-16 31-Dec-15 31-Dec-14 31-Dec-13 31-Dec-12
Names of lenders
Purpose
Primary Security, Collateral / Other Security
Sanctioned Amount (Tk.)
Rate of Interest 17.00% 17.00% 17.00% 17.00% - - 13.50%
Re-payment schedule
Status (Outstanding balance Tk.) 98,291,383 94,707,181 91,229,935 82,681,610 - - 34,970,172
Particulars 30-Sep-17 30-Jun-17 30-Jun-16 31-Dec-15 31-Dec-14 31-Dec-13 31-Dec-12
Names of lenders
Purpose
Primary Security, Collateral / Other Security
Sanctioned Amount (Tk.)
Rate of Interest - - - - - 16.00% 16.00%
Re-payment schedule
Status (Outstanding balance Tk.) - - - - - 1,200,800 2,641,760
Particulars 30-Sep-17 30-Jun-17 30-Jun-16 31-Dec-15 31-Dec-14 31-Dec-13 31-Dec-12
Names of lenders
Purpose
Primary Security, Collateral / Other Security
Sanctioned Amount (Tk.)
Rate of Interest - - - - - 16.00%
Re-payment schedule
Status (Outstanding balance Tk.) - - - - - 1,348,218
Sd/-
Ahmed Zaker & Co. Place: Chittagong
Chartered Accountants Dated: 10 Dec 2017
United Leasing Company Limited
Capital Machinery
Personal Gurantee of Directors, Machinery in the name of syndicate lessor
BDT 20,375,000
Monthly installment
BDT 50,00,000
Monthly installment
BDT 78,070,054
Monthly installment
IDLC Finance Limited
Capital Machinery
Personal Gurantee of Directors, Machinery in the name of syndicate lessor
BDT 44,599,736
Monthly Installment
Premier Leasing & Finance Limited
Capital Machinery
Personal Gurantee of Directors, Machinery in the name of syndicate lessor
BDT 24,810,929
Monthly Installment
Industrial and Infrastructure Development Finance Company Limited
Capital Machinery
Personal Gurantee of Directors, Machinery in the name of syndicate lessor
Monthly installment
BRAC BANK LIMITED
To reschedule existing loan liabilities for adjustment purpose only
Personal Gurantee of Directors.
BDT 14,223,778
Monthly installment
PHOENIX FINANCE & INVESTMENT LIMITED
Capital Machinery
Personal Gurantee of Directors, Machinery in the name of syndicate lessor
Auditors certificate regarding principal terms of secured loans and assets on which charge have been created against those loans
Based on our verification of the related offer letter/sanction advice from concerned lenders and other related documents on test basis as produced to us by the management of
Mohammed Elias Brothers Poy Manufacturing Plant Ltd., we certify that the following statement of secured loans and related principal terms including assets on which charges
have been created against those loans are consistent with the copies of related offer letter/sanction advice as produced to us for scrutiny:
Trust Bank Limited
To import / procure different raw materials, spare parts for production of Poy, DTY in your industrial units and to meet
Irrevocable General Power of Attorny on 132 decimals vacant land located at Mouza: Shikalbaha, P.S: Potiya, Dist.-Chittagong
R.S. Khatian # 178, 194, 1975, 2903, 3397; P.S. Khatian # 161, 175, 176, 2023, 1940, under title deed no. 424 dated 19.01.1998.
The property stands in the name of Mrs. Laila Begum Wife of Haji Ahmed Hossain Sowdagar.
Irrevocable General Power of Attorny on 100 decimals vacant land located at Mouza: Shikalbaha, P.S: Potiya, Dist.-Chittagong
R.S. Khatian # 179; under title deed no. 3381 dated 05.05.1987. The property stands in the name of Md. Jane Alam son of Haji
Ahmed Hossain Sowdagar.
Irrevocable General Power of Attorny on 184.55 decimals project land along with building thereon located at Mouza: Mohra, P.S:
Chittagong, Dist.-Chittagong BS mutation Khatian # 489 part of BS plot no 1486 under title deed no. 6045 dated 20.10.2010.
The property stands in the name of Mohammed Elias Brothers Poy Manufacturing Plant Limited. L/C: Tk.35 Crore; LTR: Tk. 30 Crore; & OD: Tk. 4 Crore.
At sight/ after maturity date.
DHAKA BANK LIMITED
Rescheduling of Classified STLE Contracts for adjustment purpose only
Hypothecation along with IGPA, 1st charge on entire Fixed & Floating assets of MEB poy and Register Mortgage of Land
BDT 37,130,000
Monthly installment
Dutch-Bangla Bank Limited
To reschedule existing loan liabilities for adjustment purpose only
1. 06 (Six) post dated cheques covering the monthly installment amount. 2. 01 (One) undated cheque covering entire
rescheduling amount with up to date interest. 3. Personal Guarantee of all the Directors of the concern.
BDT 4,380,000
192
(iii) Statement of unsecured loans with terms & conditions;
Certification on unsecured loan with terms and conditions of Mohammed Elias Brothers POY Manufacturing Plant Limited.
Based on our scrutiny of the relevant financial statements as prepared by management of Mohammed Elias Brothers POY Manufacturing Plant Limited. and produced to us for verification, we understand the Company has not taken any unsecured loan from any person/ body except related party transaction from 01 January, 2012 to 30 September, 2017.
Sd/- Ahmed Zaker & Co. Place: Chittagong Chartered Accountants Dated: 10 Dec 2017
(iv) Statement of inventories showing amount of raw material, packing material, stock-in-process and finished goods, consumable items, store & spares parts, inventory of trading goods etc.;
(v) Statement of trade receivables showing receivable from related party and connected persons;
Period Ended 30
September, 2017
Year Ended 30
June, 2017
Period Ended
30 June, 2016
Year Ended
31 December,
Year Ended 31
December,
Year Ended
31 December,
Year Ended 31
December, 2012
Raw Materials 171,000,070 186,191,164 211,342,692 215,573,891 185,536,049 71,448,521 118,481,051
Finished Goods 687,193,442 617,714,395 599,931,853 518,123,078 541,325,856 323,345,500 76,863,604
Store & Spare parts 77,314,683 78,563,739 70,946,980 75,417,081 67,480,671 70,634,953 52,242,595
Work in Process 52,225,395 103,452,720 63,572,350 12,245,620 10,027,359 175,927,351 158,942,680
Total 987,733,590 985,922,018 945,793,875 821,359,670 804,369,935 641,356,325 406,529,930
Sd/-
Ahmed Zaker & Co. Place: Chittagong
Chartered Accountants Dated: 10 Dec 2017
Auditors certificate regarding inventories of Mohammed Elias Brothers Poy Manufacturing Plant Limited.
Based on our scrutiny of the relevant financial statements of Mohammed Elias Brothers Poy Manufacturing Plant Limited. which have
been prepared by management and produced to us for review, we certify that as per the disclosure provided in those financial
statements, the Company had following amount of inventories as at the reporting date during the last five years:
Items
Amount in (BDT)
Period Ended 30
Septem ber, 2017
Year Ended 30
June, 2017
Period Ended
30 June, 2016
Year Ended 31
Decem ber, 2015
Year Ended 31
Decem ber, 2014
Year Ended 31
Decem ber, 2013
Year Ended 31
Decem ber, 2012
Outs tanding
Am ount
Outs tanding
Am ount
Outs tanding
Am ount
Outs tanding
Am ount
Outs tanding
Am ount
Outs tanding
Am ount
Outs tanding
Am ount
1.0 Trade receivable 1,310,027,810 1,097,629,161 756,350,554 728,976,643 399,982,690 487,308,156 487,097,084
2.0 Related party receivable - - - - - - -
3.0 Other receivable - - - - - - 80,236,553
1,310,027,810 1 ,097,629,161 756,350,554 728,976,643 399,982,690 487,308,156 567,333,637
Sd/-
Ahm ed Zaker & Co. Place: Chi ttagong
Chartered Accountants Dated: 10 Dec 2017
Total:
Based on our scrutiny of the relevant financial statements of Mohammed Elias Brothers Poy Manufacturing Plant Limited. which have been prepared by management and produced to
us for review, we certify that as per the disclosure provided in those financial statements, the Company had following amount of trade receivables as at the reporting date during the
last five years:
Audi tors certi ficate regard ing trade receivable of Moham m ed El ias Brothers Poy Manufacturing Plant L im i ted.
Product L ineSL
Am ount in BDT
193
(vi) Statement of any loan given by the issuer including loans to related party or connected persons with rate of interest and interest realized or accrued;
Certification on Statement of any Loan given by the issuer including loans to related Party or Connected Persons with rate of interest and interest realized/accrued by the Mohammed Elias Brothers POY Manufacturing Plant Limited
There is no such loan given by the Mohammed Elias Brothers POY Manufacturing Plant Limited including loan to related party or connected persons hence there is no interest realized or accrued for the period from 01 January, 2012 to 30 September, 2017.
Sd/-
Ahmed Zaker & Co. Place: Chittagong
Chartered Accountants Dated: 10 Dec 2017
(vii) Statement of other income showing interest income, dividend income, discount received, other non-operating income;
(viii) Statement of turnover showing separately in cash and through banking channel;
Auditors Certificate regarding Turnover of Mohammad Elias Brothers POY Manufacturing Plant Limited Based on our scrutiny of the turnover statement prepared by management of Mohammad Elias Brothers POY Manufacturing Plant Limited and verification of samples from those statements on test basis, we certify that in those statements the company has disclosed the following amount of turnover on credit sales during the last five years
Particulars Amount in (BDT)
Period ended 30
September, 2017
Year ended 30
June, 2017
Period ended
30 June, 2016
Year ended 31
December, 2015
Year ended 31
December, 2014
Year ended 31
December, 2013
Year ended 31
December, 2012
In cash - - - - - - -
Credit Sale 290,392,517 701,733,835 135,755,155 1,107,171,776 700,148,295 1,141,286,124 1,321,188,973
Through banking channel - - - - - - -
Total 290,392,517 701,733,835 135,755,155 1,107,171,776 700,148,295 1,141,286,124 1,321,188,973
Sd/-
Ahmed Zaker & Co. Place: Chittagong
Chartered Accountants Dated: 10 Dec 2017
P e rio d Ende d 3 0
S e pte m be r, 2 0 17
Ye a r Ende d
3 0 J une , 2 0 17
P e rio d Ende d
3 0 J une , 2 0 16
Ye a r Ende d 3 1
D e c e m be r, 2 0 15
Ye a r Ende d 3 1
D e c e m be r, 2 0 14
Ye a r Ende d 3 1
D e c e m be r, 2 0 13
Ye a r Ende d 3 1
D e c e m be r, 2 0 12
Interest Income 590,366 951,465 239,816 2,166,937 2,534,642 2,874,749 5,424,067
Gain on disposal of land - - - - - - 2,610,900
Realized income on
promise to pay bonds- - - - - 37,405,341 -
Dividend Income - - - - - - -
Discount Received - - - - - - -
Other Non-Operating
Income 63,028 363,570 150,895 855,762 1,283,959 1,267,961 446,984
Total 653,394 1,315,035 390,711 3,022,699 3,818,601 41,548,051 8,481,951
Sd/-
Ahmed Zaker & Co. Place: Chittagong
Chartered Accountants Dated: 10 Dec 2017
Auditors certificate regarding other income of Mohammed Elias Brothers Poy Manufacturing Plant Limited.
Based on our scrutiny of the relevant financial statements of Mohammed Elias Brothers Poy Manufacturing Plant Limited. which have been
prepared by management and produced to us for review, we certify that as per the disclosure provided in those financial statements, the
Company had the following other income during the last five years:
P a rt ic ula rs
A m o unt in (B D T)
194
(ix) Statement of related party transaction;
(x) Reconciliation of business income shown in tax return with net income shown in audited financial statements;
Period Ended 30
September, 2017
Year Ended 30
June, 2017
Period Ended 30
June, 2016
Ye a r Ende d 3 1
D e c e m be r, 2 0 15
Year Ended 31
December, 2014
Year Ended 31
December, 2013
Year Ended 31
December, 2012
Net income before tax as per Audited
Financial Statements 68,018,667 112,271,641 38,701,449 112,988,490 153,658,651 171,671,243 98,311,114
Add: Accounting base Depreciation 20,765,104 91,300,745 49,190,664 107,388,133 99,054,807 - -
88,783,771 203,572,386 87,892,113 220,376,623 252,713,458 171,671,243 98,311,114
Less: Tax base Depreciation 27,419,867 115,946,724 63,665,500 136,352,102 137,702,216 - -
Less: Inadmissible Income - - - - - - 2,610,900
Total Business Income/ (Loss) 61,363,904 87,625,662 24,226,613 84,024,521 115,011,242 171,671,243 95,700,214
Income shown in Tax Return 61,363,904 87,625,662 24,226,613 84,024,521 115,011,242 171,671,243 95,700,214
Sd/-
Ahmed Zaker & Co. Place: Chittagong
Chartered Accountants Dated: 10 Dec 2017
Auditors certificate regarding reconciliation of business income of Mohammed Elias Brothers Poy Manufacturing Plant Limited.
Particulars
Based on our review of the audited financial statements and related income tax return of Mohammed Elias Brothers Poy Manufacturing Plant Limited. which have been prepared by management
of the Company and produced to us for our checking, we certify that the following reconciliation of business income as shown in income tax return to net income (profit) as shown in audited
financial statements of the Company during the last five years have been extracted from those documents:
Amount in BDT
P o s it io n P e rio d Ende d 3 0
S e pte m be r, 2 0 17
Ye a r Ende d 3 0
J une , 2 0 17
P e rio d Ende d
3 0 J une , 2 0 16
Ye a r Ende d 3 1
D e c e m be r, 2 0 15
Ye a r Ende d 3 1
D e c e m be r,
2 0 14
Ye a r Ende d 3 1
D e c e m be r, 2 0 13
Ye a r Ende d 3 1
D e c e m be r, 2 0 12
Md.Zakaria Alam Chairman - - - - - - 2,880,000
Md.Rezaul Karim Managing Director - - - - - 2,400,000 2,400,000
Md.Nurul Alam Executive Director - - - - - 1,920,000 1,920,000
Md.Jane Alam Director - - - - - - 1,920,000
Md.Aminul Karim Director - - - - - - 1,920,000
Md.Sydul Karim Director - - - - - - 1,920,000
Sub Total - - - - - 4,320,000 12,960,000
P o s it io n P e rio d Ende d 3 0
S e pte m be r, 2 0 17
Ye a r Ende d 3 0
J une , 2 0 17
P e rio d Ende d
3 0 J une , 2 0 16
Ye a r Ende d 3 1
D e c e m be r, 2 0 15
Ye a r Ende d 3 1
D e c e m be r,
2 0 14
Ye a r Ende d 3 1
D e c e m be r, 2 0 13
Ye a r Ende d 3 1
D e c e m be r, 2 0 12
Sydul Karim Chairman 3,000 12,000 6,000 14,000 - - -
Mohd. Rezaul Karim Managing Director 3,000 12,000 6,000 14,000 - - -
Mohd. Abrar Hossain Director 3,000 12,000 6,000 14,000 - - -
Mohd. Asfaq Hossain Director 3,000 12,000 6,000 14,000 - - -
Mohd. Asrar Hossain Director 3,000 12,000 6,000 14,000 - - -
Sub Total 15,000.00 60,000.00 30,000.00 70,000.00 - - -
Note:
1. The figures represents from Audited Financial Statement for respective years.
Sd/-
Ahm ed Zaker & Co. Place: Chi ttagong
Chartered Accountants Dated: 10 Dec 2017
Name
Amount in (BDT)
2.Financial statements for the period ended September 30, 2017 & June 30, 2016 and for the year ended June 30, 2017 were audited by us. Financial statements for
the year ended December 31, 2015, 2014 ,2013 & 2012 were audited by Rahman Mostafa Alam & Co. Chartered Accountants.
Auditors Certificate Regarding Related Party Transaction of Mohammed Elias Brothers Poy Manufacturing Plant Limited.
Based on our scrutiny of the financial statements and other relevant records of Mohammed Elias Brothers Poy Manufacturing Plant Limited. which have been
prepared by Management of the Company and produced to us for our review, and on the basis of representation from management, we certify that as per the
disclosure provided in those documents the Company has enter into the following transactions during the last five years were as follows:
Name
Amount in (BDT)
B: Board Meeting Fee
A: Director Remuneration
195
(xi) Confirmation that all receipts and payments of the issuer above Tk.5,00,000/- (five lac) were made through banking channel;
Certification on Receipts and Payments above Tk. 500,000 ( Five Lac) were made through Banking Channel of Mohammed Elias Brothers POY Manufacturing Plant Limited.
Based on our scrutiny of the financial statements and other relevant records of Mohammed Elias Brothers POY Manufacturing
Plant Limited. which have been prepared by Management of the Company and produced to us for our review, and on the
basis of representation from management, we certify that all transactions whether receipts and payments excepting adjustment
entries of Mohammed Elias Brothers POY Manufacturing Plant Limited. above Tk. 5,00,000/- (Five lac) were not made through
banking channel in all respect from January 1, 2012 to September 30, 2017.
Sd/- Ahmed Zaker & Co.
Chartered Accountants
Place: Chittagong Dated: 10 Dec 2017
(xii) Confirmation that Bank Statements of the issuer are in conformity with its books of accounts;
Auditors certificate regarding conformity of bank statements with books of accounts of Mohammed Elias Brothers POY Manufacturing Plant Limited.
Based on our examination of bank statements and related books of accounts (including financial statements, bank reconciliation) of Mohammed Elias Brothers POY Manufacturing Plant Limited. on test basis, we certify that bank statements of the Company as disclosed in books of accounts (financial statements) from January 01, 2012 to September 30, 2017 are in conformity conforms with the samples of related bank statements as produced to us by management.
Sd/-
Ahmed Zaker & Co. Place: Chittagong
Chartered Accountants Dated: 10 Dec 2017
(xiii) Statement of payment status of TAX, VAT and other taxes/duties; and
(xiv) Any other statement as may be required by the Commission.
This information is not applicable for us.
Period Ended 30
September, 2017
Year Ended 30
June, 2017
Period Ended 30
June, 2016
Year Ended 31
December, 2015
Year Ended 31
December, 2014
Year Ended 31
December, 2013
Year Ended 31
December, 2012
Tax 2,468,619 15,237,027 223,968 2,046,416 15,034,506 41,781,379 800,000
VAT 2,251,500 4,797,980 1,289,359 7,631,316 4,504,253 - -
Supplementary Duty - - - - - - -
Others Taxes/Duties - - - 1,046,678 - - 1,000,000
Total 4,720,119 20,035,007 1,513,327 10,724,410 19,538,759 41,781,379 1,800,000
Sd/-
Ahmed Zaker & Co. Place: Chittagong
Chartered Accountants Dated: 10 Dec 2017
Certification on Status of Payment of Tax, VAT and Others Taxes/ Duties of Mohammed Elias Brothers Poy Manufacturing Plant Limited.
Particulars
Based on our scrutiny of related income tax returns, value added tax returns and statement of import of Mohammed Elias Brothers Poy Manufacturing
Plant Limited. as prepared by and presented to us by the Company’s management, we certify that the Company has disclosed followed amount of
income tax, value added tax and other taxes/duties payment in those returns/statements for the last years:
Amount in BDT
196
CHAPTER -XXVIII PUBLIC ISSUE APPLICATION PROCEDURE
197
IPO Application Process (To be finalized after getting consent letter)
Step-1 (Applicant)
1. An applicant for public issue of securities shall submit application/buy instruction to the Stockbroker/ Merchant Banker where the applicant maintains customer account, within the cut-off date (i.e. the subscription closing date), which shall be the 25th (twenty fifth) working day from the date of publication of abridged version of prospectus.
2. The application/buy instruction may be submitted in prescribed paper or electronic form, which shall contain the Customer ID, Name, BO Account Number, Number of Securities applied for, Total Amount and Category of the Applicant. At the same time:
a) Other than non-resident Bangladeshi (NRB) and Foreign applicants shall make the application money and service charge available in respective customer account maintained with the Stockbroker/Merchant Banker. No margin facility, advance or deferred payment is permissible for this purpose. In case the application is made through a margin account, the application money shall be deposited separately and the Stockbroker/Merchant Banker shall keep the amount segregated from the margin account, which shall be refundable to the applicant, if become unsuccessful.
b) Non-resident Bangladeshi (NRB) and Foreign applicants shall submit bank drafts (FDD), issued in favor of the Issuer for an amount equivalent to the application money, with their application to the concerned Stockbroker/Merchant Banker. A Non-resident Bangladeshi (NRB) and Foreign applicant may also submit a single draft against 02(two) applications made by him/her, i.e. one in his/her own name and the other jointly with another person. The draft (FDD) shall be issued by the Bank where the applicant maintains Foreign Currency account debiting the same account and provide the customer with a certificate mentioning the FC account number which has been debited to issue the FDD. The applicant shall also submit the certificate with their application. No banker shall issue more than two drafts from any Foreign Currency account for any public issue. At the same time, the applicant shall make the service charge available in respective customer account maintained with the Stockbroker/Merchant Banker.
c) Eligible investors shall submit application through the electronic subscription system of the exchange(s) and deposit the full amount intended to subscribe by the method as determined by the exchange(s).
Step-2 (Intermediary)
3. The Stockbroker/Merchant Banker shall maintain a separate bank account only for this purpose namely “Public Issue Application Account”. The Stockbroker/Merchant Banker shall:
a. post the amount separately in the customer account (other than NRB and Foreign applicants), and upon availability of fund, block the amount equivalent to the application money;
b. accumulate all the application/buy instructions received up to the cut-off date, deposit the amount in the “Public Issue Application Account” maintained with its bank within the first banking hour of next working day of the cut-off date;
c. instruct the banker to block the account for an amount equivalent to the aggregate application money and to issue a certificate in this regard.
4. Banker of the Stockbroker/Merchant Banker shall block the account as requested for, issue a certificate confirming the same and handover it to the respective Stockbroker/Merchant Banker.
5. For Non-resident Bangladeshi (NRB) and Foreign applicants, the Stockbroker/Merchant Banker shall prepare a list containing the draft information against the respective applicant’s particulars.
6. The Stockbroker/Merchant Banker shall prepare category-wise lists of the applicants containing Customer ID, Name, BO Account Number and Number of Securities applied for, and within 03 (three) working days from the cut-off date, send to the respective Exchange, the lists of applicants in electronic (text format with tilde ‘~’ separator) format, the certificate(s) issued by its banker, the drafts and certificates received from Non-resident Bangladeshi (NRB) and Foreign applicants and a copy of the list containing the draft information.
7. On the next working day, the Exchanges shall provide the Issuer with the information received from the Stockbroker/Merchant Bankers, the drafts and certificates submitted by Non-resident Bangladeshi (NRB) and Foreign applicants and the list containing the draft information. Exchanges shall verify and preserve the bankers’ certificates in their custody.
8. The application/buy instructions shall be preserved by the Stockbroker/Merchant Bankers up to 6 months from listing of the securities with exchange.
198
Step-3 (Issuer)
9. The Issuer shall prepare consolidated list of the applications and send the applicants’ BOIDs in electronic (text) format in a CDROM to CDBL for verification. The Issuer shall post the consolidated list of applicants on its website and websites of the Exchanges. CDBL shall verify the BOIDs as to whether the BO accounts of the applicants are active or not.
10. On the next working day, CDBL shall provide the Issuer with an updated database of the applicants containing BO Account Number, Name, Addresses, Parents Name, Joint Account and Bank Account information along with the verification report.
11. After receiving verification report and information from CDBL, the Issuer shall scrutinize the applications, prepare category wise consolidated lists of valid and invalid applications and submit report of final status of subscription to the Commission and the Exchanges within 10 (ten) working days from the date of receiving information from the Exchanges.
12. The Issuer and the issue manager shall conduct category wise lottery with the valid applications within 03 (three) working days from the date of reporting to the Commission and the Exchanges, if do not receive any observation from the Commission or the Exchanges.
13. The Issuer and issue manager shall arrange posting the lottery result on their websites within 06 (six) hours and on the websites of the Commission and Exchanges within 12 (twelve) hours of lottery.
14. Within 02 (two) working days of conducting lottery, the Issuer shall:
a) send category wise lists of the successful and unsuccessful applicants in electronic (text format with tilde ‘~’ separator) format to the respective Exchange.
b) send category wise lists of unsuccessful applicants who are subject to penal provisions as per conditions of the Consent Letter issued by the Commission in electronic (text format with tilde ‘~’ separator) format to the Commission and Exchanges mentioning the penalty amount against each applicant.
c) issue allotment letters in the names of successful applicants in electronic format with digital signatures and send those to respective Exchange in electronic form.
d) send consolidated allotment data (BOID and number of securities) in electronic text format in a CDROM to CDBL to credit the allotted shares to the respective BO accounts.
Step-4 (Intermediary)
15. On the next working day, Exchanges shall distribute the information and allotment letters to the Stockbroker/ Merchant Bankers concerned in electronic format and instruct them to:
a) remit the amount of successful (other than NRB and Foreign) applicants to the Issuer’s respective Escrow Account opened for subscription purpose, and unblock the amount of unsuccessful applicants;
b) send the penalty amount of other than NRB and Foreign applicants who are subject to penal provisions to the Issuer’s respective Escrow Accounts along with a list and unblock the balance application money;
16. On the next working day of receiving the documents from the Exchanges, the Stockbrokers/Merchant Banker shall request its banker to:
a) release the amount blocked for unsuccessful (other than NRB and foreign) applicants;
b) remit the aggregate amount of successful applicants and the penalty amount of unsuccessful applicants (other than NRB and foreign) who are subject to penal provisions to the respective ‘Escrow’ accounts of the Issuer opened for subscription purpose.
17. On the next working day of receiving request from the Stockbrokers/Merchant Bankers, their bankers shall unblock the amount blocked in the account(s) and remit the amount as requested for to the Issuer’s ‘Escrow’ account.
18. Simultaneously, the stockbrokers/Merchant Bankers shall release the application money blocked in the customer accounts; inform the successful applicants about allotment of securities and the unsuccessful applicants about releasing their blocked amounts and send documents to the Exchange evidencing details of the remittances made to the respective ‘Escrow’ accounts of the Issuer. The unblocked amounts of unsuccessful applicants shall be placed as per their instructions. The Stockbroker/Merchant Banker shall be entitled to recover the withdrawal charges, if any, from the applicant who wants to withdraw the application money, up to an amount of Tk. 5.00 (five) per withdrawal.
19. All drafts submitted by NRB or Foreign applicants shall be deposited in the Issuer’s respective ‘Escrow’ accounts and refund shall be made by the Issuer by refund warrants through concerned stockbroker or merchant banker or transfer
199
to the applicant’s bank account (FC account which has been debited to apply by NRB or foreign applicants) through banking channel within 10 (ten) working days from the date of lottery.
Miscellaneous: 20. The Issuer, Issue Manager, Stockbrokers and Merchant Bankers shall ensure compliance of the above.
21. The bank drafts (FDD) shall be issued considering TT Clean exchange rate of Sonali Bank Ltd. on the date of publication of abridged version of prospectus.
22. Amount deposited and blocked in the “Public Issue Application Account” shall not be withdrawn or transferred during the blocking period. Amount deposited by the applicants shall not be used by the Stockbrokers/Merchant Bankers for any purpose other than public issue application.
23. The Issuer shall pay the costs related to data transmission, if claimed by the Exchange concerned up to an amount of Tk.2,00,000.00 (taka two lac) for a public issue.
24. The Stockbroker/Merchant Bankers shall be entitled to a service charge of Tk.5.00 (taka five) only per application irrespective of the amount or category. The service charge shall be paid by the applicant at the time of submitting application.
25. The Stockbroker/Merchant Banker shall provide the Issuer with a statement of the remittance and drafts sent.
26. The Issuer shall accumulate the penalty amount recovered and send it to the Commission through a bank draft/payment order issued in favor of the Bangladesh Securities and Exchange Commission.
27. The concerned Exchange are authorized to settle any complaints and take necessary actions against any Stockbroker/Merchant Banker in case of violation of any provision of the public issue application process with intimation to the Commission.
200
Application Form
ÔÔcyuwRevRv‡i wewb‡qvM SuzwKc~Y©| †R‡b I ey‡S wewb‡qvM KiæbÕÕ
Interested persons are entitled to a prospectus, if they desire, and that copies of prospectus may be obtained from the issuer and the issue managers
Mohammed Elias Brothers POY Manufacturing Plant Limited
APPLICATION FOR PUBLIC ISSUE
Date :
Name of applicant :
Client Code :
BO ID No. :
Category of applicant :
Name of the Company/Fund :
Number of Shares/Units :
Total amount :
Amount in word :
Mode of payment :
Cheque/Draft information :
________________________________ Signature of Applicant(s)
_________________________ Signature of
Authorized Officer
201
CHAPTER -XXIX MANAGEMENT DISCLOSURES AND OTHERS
202
Additional Disclosure by the Management
A. Disclosure regarding material change
Declaration regarding any material change including raising of paid up capital after the date of Audited Financial Statements
This is to certify that, Mohammed Elias Brothers POY Manufacturing Plant Limited has not made any material change including rising of paid up capital after the date of audited financial Statements as on September 30, 2017 as included in the prospectus.
Sd/- Sd/- Sd/- Sd/- Md. Mozaffor Ahmed
Company Secretary Md. Shahidullah Khan Chief Financial Officer
Mohd. Rezaul Karim Director & Managing Director
Sydul Karim Chairman
B. Disclosure regarding no way connection with the issue manager
Declaration regarding no way connection with the Issue Manager(s)
This is to certify that neither Mohammed Elias Brothers POY Manufacturing Plant Limited nor any of its directors have any connection with Prime Finance Capital Management Limited, AIBL Capital management Limited and AB Investment Limited (Issue Managers of Mohammed Elias Brothers POY Manufacturing Plant Limited)
Sd/- Sd/- Sd/- Sd/- Md. Mozaffor Ahmed
Company Secretary Md. Shahidullah Khan Chief Financial Officer
Mohd. Rezaul Karim Director & Managing Director
Sydul Karim Chairman
C. Disclosure regarding cost audit by professional accountant as per the Company Act, 1994
Declaration regarding Cost Audit
This is to certify that, as per provision of the Companies Act, 1994, Cost Audit by Professional Accountant is not applicable for Mohammad Elias Brothers POY Manufacturing Plant Limited.
Sd/- Sd/- Sd/- Sd/-
Md. Mozaffor Ahmed Company Secretary
Md. Shahidullah Khan Chief Financial Officer
Mohd. Rezaul Karim Director & Managing Director
Sydul Karim Chairman
Sd/- Sd/- Sd/-
Managing Director & CEO Prime Finance Capital Management Limited
Chief Executive Officer AIBL Capital Management Limited
Chief Executive Officer AB Investment Limited
D. Disclosure regarding holding of regular AGM
Declaration regarding Holding Regular Annual General Meeting
This is to certify that Mohammad Elias Brothers POY Manufacturing Plant Limited has been in regular in holding Annual General Meeting since incorporation.
Sd/- Sd/- Sd/- Sd/- Md. Mozaffor Ahmed
Company Secretary
Md. Shahidullah Khan
Chief Financial Officer
Mohd. Rezaul Karim
Director & Managing Director
Sydul Karim
Chairman
203
E. Disclosure regarding compliance of all the requirements of Bangladesh Securities and Exchange Commission (Public Issue) Rules, 2015 in preparing Prospectus
Declaration regarding Compliance with all the requirements of Bangladesh Securities and Exchange Commission
(Public Issue) Rules, 2015 in preparing Prospectus
This is to certify that the Company complies with all the requirements of Bangladesh Securities and Exchange Commission (Public Issue) Rules, 2015 in preparing prospectus of Mohammad Elias Brothers POY Manufacturing Plant Limited.
Sd/- Sd/- Sd/- Sd/- Md. Mozaffor Ahmed
Company Secretary
Md. Shahidullah Khan
Chief Financial Officer
Mohd. Rezaul Karim
Director & Managing Director
Sydul Karim
Chairman
Declaration regarding Consent of the Directors to Serve as Directors
We hereby agree that, we have been serving as Directors of “Mohammad Elias Brothers POY Manufacturing Plant Limited” and confirm to continue to act as Directors of the Company.
Sd/- Sydul Karim
Chairman
Sd/- Mohd. Rezaul Karim
Director & Managing Director
Sd/- Mohd. Asfak Hossain
Director
Sd/- Mohd. Asrar Hossain
Director
Sd/- Mohd. Abrar Hossain
Director
Sd/- Md. Golam Moin Uddin Chowdhury
Independent Director
Sd/-
Mohd. Eradat Ullah, FCA
Independent Director
Place: Chittagong Date: 20.12.2017
