Envoy Textiles is set to raise Tk 87 crore by issuing non-convertible cumulative preference shares in order to bring sustainable finishing machine and build captive power.

The preference share would be fully redeemable, with a tenure of five years. The shares would be issued to banks, insurance companies, institutional investors and eligible investors.

The face value of the preference shares would be Tk 1 crore for institutional investors and Tk 50 lakh for eligible investors.

The Bangladesh Securities and Exchange Commission yesterday gave Envoy Textile, which made its debut on the stock exchange in 2012, the go-ahead to issue the preference shares.

"We will utilise the fund to purchase sustainable finishing machine where chemical would be used at a very low level," said Kutubuddin Ahmed, chairman of Envoy Textile.

The other funds would be used in forming captive power of 10 megawatts and repayment of short-term loan, Ahmed said.

Envoy's profit after tax shot up 68 per cent year-on-year to Tk 55.4 crore in the 2018-19 financial year. During the period, its revenue increased 20.6 per cent to Tk 911.85 crore.

Asked about the impact of the coronavirus pandemic on Envoy Textile, Ahmed said they are lucky that they brought in raw materials in hordes before the virus spread.

On the other hand, the textile maker imports only 15-20 per cent of its requisite cotton from China, which can be brought from India though but at a higher cost.

"However, if the epidemic continues for long it will impact all textile companies. And the woven garment makers would be impacted the most," he added.

The news of the announcement though failed to cheer the market: shares of Envoy Textile closed 0.40 per cent higher at Tk 24.80 yesterday.

Source: The Daily Star