Robi Axiata to enter stock market
However, the company thinks existing tax incentive for listing is not enough
Robi Axiata Ltd, the second largest telecom service provider in Bangladesh, is interested in getting listed in the local stock exchanges, said Dr M Khairul Hossain, chairman of the Bangladesh Securities and Exchanges Commission (BSEC).
At the opening session of World Investor Week 2019 on Monday, the chief securities regulator said: "We had spoken about the ongoing audit claims dispute with Grameenphone and Robi, and Robi expressed interest in entering the stock market after the issue is resolved.
"The company is interested in getting listed through an initial public offering (IPO), using the book building method, but we advised them to make a better consolidation of financial statements – which the company is currently doing," he added.
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Robi Axiata Ltd emerged as the second largest telecom service provider in 2016, following a merger between Robi and Airtel Bangladesh in 2016.
The merged entity has turned out to be a profit making organisation, which is what stock market investors look for.
When contacted, Shahed Alam, the chief corporate and regulatory officer of Robi Axiata said the company is always keen on diversifying its source of funds for further growth of the business.
He informed The Business Standard that Robi had recently held a fruitful discussion with the BSEC about the possibility of floating a corporate bond.
Regarding getting listed in the stock market, the company thinks that the existing tax incentive structure for equity sharing with general investors is not sufficient.
At present, listed telecom service providers are allowed to pay corporate tax on only 5 percentage points less than their non-listed competitors – which was 10 percent until July 2017.
Robi's statement to The Business Standard reads: "While we are very keen on getting listed in the stock market, the exorbitantly high corporate tax and the minimum tax is causing tremendous strain on our business.
We don't think that such a taxation structure is conducive for us to come to the stock market."
"Therefore, we urge the authorities to address these well-founded concerns of ours to help the business find a strong footing.
In addition, allowing a corporate tax incentive would create a scenario that could win the confidence of potential investors and our shareholders," the statement added.
