Bangladesh Steel Re Rolling Mills Limited - ? Â· Bangladesh Steel Re-Rolling Mills Limited is the first fully automatic re-rolling mills built in the country. ... BSRM Steels Ltd: ...

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  • SANDHANILIFEFINANCELIMITED

    BangladeshSteelReRollingMillsLimited

    IPODETAILSFace Value per share Tk.10.00

    Premium Tk. 25.00 Offer Price per share Tk. 35.00 Market Lot (Shares) 200

    Security Trading Code BSRMLTD Authorized Capital Tk. 5,000,000,000

    Pre-IPO paid-up Capital Tk. 1,558,510,380

    IPO size in shares 17,500,000

    IPO size in Tk. at face value

    Tk. 175,000,000

    IPO size in Tk. at offer price

    Tk. 612,500,000

    Post IPO Paid-up Capital Tk. 1,733,510,380

    Subscription Open February 01, 2015

    Subscription Close February 05, 2015

    NAV per share Tk.52.09(including revaluation reserve)andTk.25.58(excludingrevaluation

    reserve)as at December 31, 2013 EPS Tk. 5.06 for the year ended on December

    31, 2013 Issue Manager(s) Alliance Financial Services Limited

    Auditors Rahman Rahman Haq

    Website www.bsrm.com

    Company Profile

    Bangladesh Steel Re-Rolling Mills Limited is the first fully automatic re-rolling mills built in the country. It was established in 1952 as a small manually operated rolling mill by four businessmen, Mr. Akberali Alibhai Africawala, Mr. Taherali Africawala, Mr. Abdul Hussain Africawala and Mr. Rajabali Africawala. Later in 1960 it was reconstructed under the Companies Act 1913 as East Bengal Steel Re-Rolling Mills Limited. After our liberation the company was renamed as Bangladesh Steel Re-Rolling Mills Limited, and become the flagship company of BSRM Group. In 1984, the old plant was dismantled and commissioned with fully automatic machinery from UK with enhanced annual production capacity of 60,000 MT. In 2004 another BMRE (Balancing, Modernization, Rehabilitation & Expansion) was made and the production capacity increased to 120,000 MT introducing high quality 60-grade re-enforcing steel to facilitate heavy construction in Bangladesh. In 2011, Bangladesh Steel Re-Rolling Mills Limited amalgamated with Meghna Engineering Works Limited (MEW) another concern of BSRM Group engaged in billet making. Since the amalgamation, the two companies carries out its business as a single legal entity and operates as two separate units (Bangladesh Steel Re-Rolling Mills Limited as Re-rolling mills and Meghna Engineering Works Limited as Steel Melting Works) for administrative purpose only. In the Steel Melting Works unit, MS Billet is produced from scraps and sponge iron and then by rolling this MS billet the Re-rolling Mills unit produces 60 grade and 40 grade MS bars , angles, channels, I-beam, great-beam etc.

    Name of Associates, Subsidiary/Related Holding Company and their Core Areas of Business:

    Name of Company

    Core area of Business Established in Remarks % of Share

    BSRM Steels Limited

    MS Rod Manufacturer 20 July 2002 Associate 31.19%

    BSRM Steel Mills Limited

    Proposed Manufacturer of M.S. Billets

    16 April 2008 Associate 21.76%

    A brief on Sister concerns of the group at a glance:

    BSRM Steels Ltd: BSRM Steels Limited has been listed with both Dhaka & Chittagong Stock Exchanges in 2009. The plant is fully automated 600,000 TPA re-rolling mill supplied by Danieli of Italy and located at Fouzderhat Industrial Area, Chittagong. It produces latest generation Xtreme 500W grade 500 re-bars. BSRM Iron & Steel Co. Ltd: (BISCO) BISCO, the subsidiary of BSRM Steels Limited, produces high-grade MS Billet for BSRM Steels Ltd. The project is in operation since June 2010 and now operating at around 90% capacity. H. Akberali & Co. Ltd: Owners of land property and commercial buildings at Dhaka and Chittagong (Agrabad & Sadarghat). BSRM Wires Ltd: Running a wire drawing plant at Karnafully Engineering Works Ltd. premises in Nasirabad, Chittagong. Karnafully Engineering Works Ltd: Owners of a 3.26 acre scrap processing yard and covered buildings for storage in Nasirabad Industrial Area, Chittagong and wire manufacturing unit of BSRM Wires Limited. BSRM Recycling Industries Ltd: Owners of a scrap processing unit in Nasirabad, Chittagong, with imported shears and cranes. Bangladesh Steels Ltd: Being used as storage for slags and machineries situated at Nasirabad along with 2.65 acre plot at Faujderhat Industrial Area to stock billets of BSRMS BSRM Steel Mills Limited: This is a proposed project for the production of 862,000 MT MS Billet per year. Land acquisition for the project has already completed and other installations are continuing in full swing. The project is expected to go into commercial operation from January 2015. Chittagong Power Company Ltd. (CPCL): This is a proposed coal-fired power plant for generation of 150 MW power primarily to meet the consumption of BSRM Group concerns. It has already received permission from the Govt. and expected to start power generation within next 3 years. BSRM Logistics Limited: The proposed jetty will be built in Bhatiary. Permission from the Govt. has already been received. Furthermore, the company owns and operate a fleet of 55 trucks lorries to carry own materials to customer site.

    Utilization of fund

    On Going Expansion BMRE

    Million Tk.

    Implementation schedule

    A. Payment of Retention Money (For Machinery)

    36.00 Apr-15

    184.20 Sep-15

    Total 220.20

    B. Finished Goods Storage Shed

    167.31 Within December 2015 after getting IPO fund

    C. Loan repayment 204.00 Immediate the IPO fund is available

    IPO Expenses (approx) 20.99 Time to time , As and when required

    Total IPO proceeds 612.50

    Credit Rating Status

    Long Term Short Term

    Entity Rating AA- ST-2

    Date of Validity

    20 May, 2015 20 November, 2014

    Rating Assigned By

    Credit Rating Information and Services Ltd. (CRISL)

    Financial Information (BDT in MN)

    2011 2012 2013 Total Equity 4,404.88 7,526.32 8,118.75 Total Assets 14,854.80 16,840.38 21,144.14 Revenue 12,664.40 14,043.42 8,602.42 Net Profit 1,150.80 453.92 788.70 EPS 7.38 2.91 5.06

  • SANDHANILIFEFINANCELIMITED

    FINANCIAL RATIOS

    Particulars 2010 2011 2012 2013

    Liquidity Ratios:

    Current Ratio 0.66 0.95 1.06 0.99

    Quick Ratio 0.37 0.41 0.40 0.43

    Cash Ratio 0.02 0.01 0.01 0.01

    Operating Cash Flow Ratio -0.16 0.23 0.07 0.01

    Operating Efficiency Ratios:

    Average Collection Period (Days) 16.86 12.97 12.82 20.11

    Inventory Conversion Period(Days) 60.42 88.94 223.20 114.96

    Payables Payment Period (Days) 33.50 41.23 120.43 68.46

    Operating Cycle (Days) 77.28 101.91 236.02 135.07

    Cash Conversion Cycle (Days) 43.79 60.68 115.58 66.62

    Operating Profitability Ratios:

    Gross Profit Margin (GPM) 6.00% 8.50% 4.97% 5.81%

    Operating Profit Margin (OPM) 5.10% 6.84% 3.46% 3.31%

    Net Profit Margin (NPM) 3.42% 9.09% 3.23% 9.17%

    Return on Total Assets (ROA) 3.41% 7.75% 2.70% 3.73%

    Return on Equity (ROE) 10.78% 26.13% 6.03% 9.71%

    Leverage Ratios:

    Total Debt to Equity 2.16 2.37 1.24 1.60

    Times Interest Earned (TIE) 2.49 2.20 1.01 1.81

    Debt to Total Assets 0.68 0.70 0.55 0.62

    Growth Rates:

    Sales Growth Rate 26% 66% 11% -39%

    EBIT Growth Rate 27% 122% -44% -41%

    Net Income Growth Rate 212% 341% -61% 74%

    Total Asset Growth Rate 31% 94% 13% 26%

    Listed Peer Companies BSRMSTEEL GPHISPAT RSRMSTEEL BSRMLTD

    Paid up in mn 3417.75 1247.40 655.20 1733.51

    Listing year 2009 2012 2014 IPO

    Year End Dec April June Dec

    ROE (latest) 19% 14% 9% 10%

    Mk F P/E * 20.28 17.86 9.96 NM

    Mk Price* *(as on 29-01-

    15)

    78.7 45 54.2 35 (offer Price)

    Research Team Syed Abu Redowan Research Analyst redowan_2010@yahoo.com

    Shubho Barua Chowdhury Research Associate shubhobarua@gmail.com

    Disclaimer

    ThismaterialisproducedbySandhaniLifeFinanceLtd.,aMerchantBankerregisteredwithRegistrarofJointStockCompaniesandFirms,Bangladesh.Thisdocumentisnottobeusedorconsideredasan offer to sell or a solicitation of an offer to buy any securities, or to enter into any otheragreement. Projections of potential risk or return are illustrative, and should not be taken aslimitations of themaximum possible loss or gain. Past performance is not indicative of futureresults. The information and any views expressed in this document are given as at the date ofwritingandsubjecttochange.Whilethe informationhasbeenobtainedfromsourcesbelievedtobereliable,SandhaniLifeFinanceLtd.donotrepresentthatitisaccurateorcompleteanditshouldnotbe reliedonas such.SandhaniLifeFinanceLtd.and itsemployeesacceptno liability foranydirect or consequential loss arising from the use of this document or its contents or otherwisearisinginconnectiontherewith.Thisdocumentisnottoberelieduponorusedinsubstitutionfortheexerciseofindependentjudgment.Itisbeingfurnishedtoyousolelyforyourinformation,andbyacceptingthisreportyouagreetobeboundbytheforegoinglimitations.

    83.66

    261.19

    1,150.80

    453.92

    788.70

    2009 2010 2011 2012 2013

    Takainmn

    Netprofitaftertax

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