National Tea downgraded to category ‘B’

National Tea Company (NTC) has been downgraded from the category ‘A’ to the category ‘B’ at the Dhaka Stock Exchange (DSE) due to its failure to pay a 10 per cent dividend to shareholders for the fiscal year 2021-22.

The board of directors of the state-owned tea company recommended a 7.50 per cent cash dividend for FY22, according to DSE data.

But, according to DSE’s settlement and transaction rules, a company must pay a minimum dividend of 10 per cent for belonging to the category ‘A’.

The company declared lower dividend in the last fiscal year citing to a fall in its profit.

The company could again return to the category ‘A’ if it gives a minimum of 10 per cent to its shareholders for FY23.

Otherwise, it would have to remain in the current category.

National Tea Company had disbursed a 10 per cent cash dividend in FY21, 5 per cent cash in FY20, and 22 per cent cash in FY19 and FY18 each, according to DSE data.

If a company does not declare any dividends, or fails to hold annual general meetings for years, or remains inoperative for over six months, it is downgraded to the category ‘Z’ by the DSE.

The sponsor-directors own a 48.60 per cent stake in the company, while the government holds 4.33 per cent, institutions 8.97 per cent, and the general public 38.1 per cent till November 30 this year.