Global economic slowdown, high dollar value, and a staggering rise in raw materials prices have pushed Walton Hi-Tech Industries to a tight corner as the local giant is likely to see the lowest profit in the fiscal year 2022–23 since its capital market listing.
The locally grown multinational company made a net profit of Tk 249 crore in the first three quarters of FY23, and its earnings per share (EPS) was Tk 8.25 for the July–March period of the last fiscal.
The electrical and electronics appliances maker had posted a net profit of Tk 819.93 crore, and EPS of Tk 27.07 in the July–March period of FY22.
The publicly traded company’s annual net profit was Tk 1,216 crore in the fiscal 2021-22, which was Tk 1,639 crore in FY21, Tk 726 in FY20, and Tk 1,376 crore in FY19.
Now, it seems impossible for the local electronics giant to outstrip the previous year’s profit in the fiscal year 2022–23 because it needs to add Tk 967 crore more in the June quarter to make the same profit in FY23 that it made in the year before.
The electrical and electronics appliances maker’s earnings per share was Tk 40.16 in FY22, much higher than Tk 8.25 it reported for July-March of FY23.
When contacted, Walton’s Company Secretary Rafiqul Islam could not be reached over mobilephone for a comment.
Later, the company’s Deputy Managing Director Humayun Kabir was contacted by The Business Post, but citing his illness he declined to say anything.
The listed engineering-sector firm posted earnings per share of Tk 1.52 negative in the first quarter of FY23, against earnings per share of Tk 9.28 for the same period the year before.
The company that time said its earnings had fallen mainly due to price hikes of raw materials, higher freight costs, vulnerable market conditions, and the devaluation of the taka against foreign currencies, especially the US dollar.
At the end of the first nine months of FY23, when its earnings per share were 70 per cent year-on-year lower, the company earnings had decreased due to the price hike of raw materials and higher freight costs, hampering the overall profitability.
The locally grown multinational organised the ‘International Advanced Components and Technology (ATS) Expo-2023’ last month, where its Managing Director and CEO, Golam Murshed said Walton was now exporting products to over 40 countries around the world.
The expo would help the company achieve its export target of $10 billion by 2030, Golam Murshed said.
This was the first time in the history of Bangladesh that a single Bangladeshi brand organised such a technology and solutions expo. The expo highlighted the potential industries of Bangladesh and the domestic industries’ capabilities.
Walton shares remained stuck at its floor price of Tk 1047.7 each on Thursday.
Walton Hi-Tech Industries is the second largest listed company in terms of market capitalisation.
In recent times, the electrical and electronic appliance maker’s several sponsor directors together offloaded 4.25 lakh shares from their holdings.
The shares offloading was implemented aiming to comply with the securities regulator’s order that every listed company must have a minimum of 10 per cent free float shares in the stock market.
Even after huge offloading by its directors and sponsors, now Walton’s free float share accounts for only 1 per cent of its total shares, as per the Dhaka Stock Exchange (DSE) data.
The Bangladesh Securities and Exchange Commission (BSEC) in December 2021 gave the company’s board three years to comply with the minimum requirement of free float shares.
Free-float shares are those held by external shareholders who are listed shareholders and do not require a previous declaration to trade firm equities.
In 2020, Walton had raised Tk 100 crore through the capital market.
The company has a paid-up capital base of Tk 302 crore.
Incorporated in 1977, Walton Hi-Tech Industries started manufacturing refrigerators, freezers, air-conditioners, and compressors in early 2008.
Institutional investors held a 0.38 per cent stake in the company, while foreign investors owned 0.10 per cent, and the general public 0.52 per cent till July this year.