The Bangladesh Sugar and Food Industry Corporation (BSFIC) has formed a committee to relaunch Shyampur Sugar Mills Ltd, three years after the factory's closure.
The BSFIC director (Production) will lead the eight-member committee, which has been given 10 days to submit the business plan of the state-run Shyampur Sugar Mills after a pre-feasibility study.
The share price of the publicly traded company soared from Tk 178.7 in the last two days to Tk 216 on Monday after the decision, which took place at Thursday’s board meeting of the BSFIC. The company has not been in operation since December 2020.
Shyampur Sugar Mills’ board of directors has recommended no dividend for the year ending on June 30, 2023. The company has also reported a per-share loss of Tk 43.62 for the year ending on June 30, 2023, as against a per-share loss of Tk 53.03 for FY22.
The earnings ratio has decreased this year because of the sales and distribution expenses, and the financial cost amount are lower compared to the previous year, the company said. However, it had posted the lowest loss in FY22 in the last five years.
The company registered a net loss of Tk 26.51 crore in FY22 versus the loss of Tk 62.56 crore in the previous FY. Its net loss stood at Tk 60.69 crore in FY20, compared to Tk 32.87 crore in FY17.
Speaking to The Business Post, Shyampur Sugar Mill Managing Director Masood Sadiq said, “Our production process remains suspended from December 3, 2020. So, we currently have no costs associated with machinery, which helped us minimise losses in FY22.
“Being a publicly traded entity, our shares are being traded on the stock exchanges. But it is also surprising to us how the stock price of a loss-making company could soar without any business progress.”
At the end of FY22, the company’s long-term loan stood at Tk 31.10 crore with another short-term loan of Tk 1,94.78 crore.
The government owns a 51 per cent stake in the company, while general investors hold 47.66 per cent, and institutional investors hold the remaining 1.34 per cent. Shyampur Sugar Mill got listed in the capital market in 1996.
Bangladesh Sugar and Food Industry Corporation (BSFIC) shut down the operations of six state-run sugar mills, including Shyampur Sugar Mills, in December 2020 to reduce the burden of losses made by those mills.