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Robi’s Reddot to open new subsidiary to sell tech services

Staff Correspondent
19 Jul 2023 18:11:35 | Update: 20 Jul 2023 16:51:33
Robi’s Reddot to open new subsidiary to sell tech services

Reddot Digital Ltd, owned by the country’s second-largest telecom operator Robi Axiata, is going to open a new subsidiary – AxEnTec PLC – subject to the court approval.

The board of directors of Reddot on July 12 approved the scheme and the registered office of the new venture will be in Bangladesh, as per a disclosure filed with the Dhaka Stock Exchange (DSE) Wednesday.

The new subsidiary will serve the market through sales, distribution and marketing services for connectivity, IT and ICT solutions, digital services, software, applications and hardware, including data center, cloud and cloud infrastructure, internet of things (IoT), and cyber security.

Reddot, however, will continue its existing business of development and operations of IT and ICT software, applications and other related solutions, the DSE filing read.

With an aim to expand its network coverage and improve data services, Robi Axiata, the parent company of Reddot Digital Ltd, is set to borrow $55 million (about Tk 600 crore) from its parent company – Axiata Group Berhad, according to another regulatory filing published Monday last.

The multinational firm said they did not pledge any asset as security and did not create any charge with RJSC in relation to this loan agreement.

The multinational company’s revenue grew by 16.28 per cent to Tk 2,347 crore in the first quarter (January-March) of 2023 on a year-on-year basis.

The company also posted a 5.5 per cent year-on-year jump in net profit to Tk 42 crore in the current year’s first quarter.

Its earnings per share (EPS) in the January-March this year was Tk 0.08, which was the same as in the last year’s same period.

Robi shares have been stuck at the floor price of Tk 30 each on the DSE since August last year.

The telecom operator reported a net asset value (NAV) of Tk 12.90 per share for the quarter ended March 31 this year. Its net asset value was Tk 12.72 per share till March 2022.

The company’s net operating cash flow per share (NOCFPS) was Tk 1.83 as on current year’s March quarter.

The multinational’s consolidated net profit had reached Tk 183.3 crore in 2022 from Tk 180.3 crore in the year before.

Despite a slim growth, the company paid a 7 per cent cash dividend to its shareholders for the year ended in December 2022, the highest since its incorporation.

Robi was the first operator to roll out 3.5G services in Bangladesh. It introduced 4.5G services across all 64 districts in 2018.

With an authorised capital of Tk 6,000 crore, the company’s paid-up capital is Tk 5,237 crore.

Sponsor-directors owned a 90 per cent stake in the company, while institutional investors held 1.66 per cent, and the general public 8.34 per cent as on June this year.