Sonali Aansh stock soars on stellar profit growth

Sonali Aansh Industries Ltd registered a 1.88% jump in its share price on Wednesday at the Dhaka Stock Exchange (DSE), thanks to its staggering 388% year-on-year profit growth in the July to December period of the fiscal 2021-22.

According to its half-yearly financials published on the DSE website on Wednesday, the company's earnings per share (EPS) stood at Tk1.27, which was Tk0.26 in the same period of FY21.

After the disclosure, the company's stellar profit growth attracted more investors to buy its shares and at the end of the trading session, the shares closed at Tk476.8 each.

On the day, 33,324 shares were traded for Tk1.61 crore while the total number of outstanding shares of the company is 27.12 lakh.

To explain its share price hike to the stock exchange, the company said that its profit increased due to an increase in sales.

At the end of the first half of FY22, its net asset value per share stood at Tk226.93 and the net operating cash flow per share Tk7.90.

Earlier, the company had paid a 10% cash dividend to its shareholders for FY21. Last year, the company's EPS was Tk1.13, up by 82% compared to the previous year.

But the company's auditor said the company did not charge the depreciation against their assets, which is why its net asset value and profit were overstated.

Sonali Aansh's paid-up capital is only Tk2.71 crore. The securities regulator recently asked the company to submit its plan to raise the capital to Tk30 crore.

The company was listed with the stock exchange in 1985 when Beximco Group was its owner. Later, the business conglomerate exited the company's board.

According to the DSE website, Sonali Aansh's board holds 50.78% shares, where institutional investors have 5.63% and general investors have 43.59% as of February this year.

Sonali Aansh Industries, one of the leading export-oriented manufacturers in the jute sector, produces jute yarn and diversified jute products.