Robi starts move to get listed, raise Tk 500cr through IPO

Robi, the second largest mobile operator in Bangladesh, has begun a process to raise around Tk 500 crore from the capital market through an initial public offering, Securities and Exchange Commission officials said.
The BSEC has suggested that the company should opt for the fixed price method of floating shares so that the general investors can be benefited, a senior official of the commission said.
Robi Axiata Ltd, a subsidiary of the Malaysia-based Axiata Group, has recently signed a memorandum of understanding with IDLC Investment Limited to appoint it as issue manager to the IPO, he said.
Officials of Robi declined to comment.
BSEC officials said that the multinational company had met the commission’s top brass several times over the IPO issue and the commission assured the company of every possible support.
After preparing the December-end annual financial statements and IPO prospectus, the company might submit the IPO proposal by June this year, they said.
As per the current public issue rules, a company must float at least an amount of 10 per cent of its paid up capital.
Robi has a paid up capital of around Tk 5,000 crore, and to comply with the rules, the company would float 10 per cent of its paid up capital or around 50 crore shares at Tk 10 per share through the IPO, said the BSEC official.
If enlisted, the number of free float shares of Robi would be the highest among all the listed companies except few banks.
According to the new public issue rules amended in September last year, a company can apply for IPO if it has been in commercial operation having positive net profit after tax at least for the latest financial year.
Robi would be the largest company in terms of paid up capital to be enlisted on the country’s capital market.
The Malaysia-based telecom operator would be the first multinational company to be enlisted on the country’s stock exchanges after RAK Ceramics that was enlisted in 2010.
Grameenphone, the largest mobile operator in the country, was enlisted on the stock exchanges in 2009.
No MNC was enlisted on the bourses under the current commission led by its chairman M Khairul Hosain in last nine years.
Market experts said there were many MNCs doing business in the country and the government by giving policy support could enlist them on the bourses to flourish the capital market.
Robi expects that the company would make profits in its last financial year ended on December 31, 2019 and expects to submit the IPO proposal to the BSEC as soon as possible, the BSEC officials said.
Robi incurred losses of Tk 24.6 crore in the first quarter (January-March) and Tk 32.2 crore in the second quarter (April-June) of the year 2019, but its business turned around significantly in the third quarter, posting Tk 170.7 crore in profits.
Therefore, the company made profits of Tk 114 crore in the last nine months (January-September).
At the end of September, 2019, the net asset value of the company was Tk 6,046 crore while cash and cash equivalent was Tk 275.9 crore.
The subscriber base of the operator increased to 4.81 crore at the end of September last year, representing almost 30 per cent of the market share.
The company commenced operation in 1997 as Telekom Malaysia International (Bangladesh) with the brand name Aktel. In 2010, it was rebranded as Robi and the company changed its name to Robi Axiata Limited.
Following its merger with Airtel Bangladesh, the merged company, Robi Axiata Limited (Robi), started its commercial operation on November 16, 2016.