Wednesday, May 08, 2024
Mithun Knitting and Dyeing Limited is a listed company in the textile sector. Its production has been discontinued since 2019. Even after issuing notice to this effect on the DSE website, its share price rose by 93 per cent after the floor price was lifted.
The increase in the share price is such that the company has to send a letter of inquiry from DSE to explain the reason for the rise in the share price.
In the second quarter of FY24, the company said that due to the suspension of factory operations since September 20, 2019, the earnings per share and net operating cash flow per share were null.
In such a situation, the floor price on the share price of the company was cancelled on January 18, 2024. At that time, the share price of the company was Tk 15.6.
The company's share price fell to Tk 12.8 on January 28, 2024, a few days after the cancellation of the floor price. After that, there was no looking back. On February 15, 2024, the share price rose by 93 per cent to Tk 24.8.
After that, DSE wrote to the company two times to inquire about the reason for the increase in the share price, and the company said there is no undisclosed price-sensitive information about the company for the unusual price hike and increase in the volume of shares.
The company's shares are currently trading at Tk 19.40.
In 2019, the company, a concern of Bangas Tallu Group, had to shut down operations because it failed to comply with the conditions of modernisation demanded by international buyers.
After becoming non-operational, the company also failed to comply with securities rules and regulations.
Furthermore, it failed to disclose annual and quarterly financial reports from FY2018–2019 to FY2020–21. It has not paid any dividends to shareholders since fiscal year 2016–2017.
According to sources, Mithun Knitting was forced to shut down its factory because BEPZA terminated the lease agreement and took away all its factory assets in February 2019, after the company failed to pay off the claims of Chattogram Export Processing Zone (CEPZ).
As per a qualified opinion, the CEPZ authority had warned Mithun Knitting's management about the agreement termination in case of default.
CEPZ also informed the company about their claim which was approximately Tk 10.68 crore.
Its factory is located in CEPZ and the firm suffered a loss in fiscal year 2016-17, having paid 20 per cent in stock dividends in the previous fiscal year 2015-16.
According to the latest annual report of Mithun Knitting and Dyeing Limited, its factory was set up in CEPZ in 1991 and came into commercial production in 1993. In the following year, the company was listed on the two capital markets of the country.
According to the report, the daily production capacity of the company was 5.7 tonnes of fabrics and five thousand pieces of garment products. There were 764 employees and officers employed in the company which exported all products abroad.
In the fiscal year 2017-18, the total sales of the company were around Tk 44 crore. However, the net loss was Tk 7.27 crore. In the fiscal year before that, it incurred a loss of around Tk 6 crore. As the company's production has come to a halt in recent years, the latest figures could not be available.
Despite frequent efforts over phone, Mithun Knitting and Dyeing Limited Company Secretary Mohammad Shohel Rana could not reached for his comments about the company’s latest situation.
