Oxygen sellers see sharp rise in FY21

Covid-19 pandemic has blessed the oxygen sellers as its demand increased significantly across the country.

The country's oxygen producers and suppliers saw a sharp rise in sales in the fiscal year 2020-21.

The sales of top oxygen seller Islam Oxygen Limited reached Tk145.42 crore in fiscal 2020-21, a 31% growth compared to the previous fiscal.

The only listed full-fledged oxygen seller, Associated Oxygen, also posted a significant growth of 43% to Tk56 crore in the last fiscal year, compared to the previous year.

Linde Bangladesh Limited, a multinational oxygen seller, witnessed a stellar growth in supplying medical oxygen. But its core business is welding electrodes and industrial gas supply.

In July last year, Associated Oxygen raised Tk15 crore from the capital market to boost the production capacity to meet the growing demand. Currently, its production capacity is 8.27 lakh cubic metres of oxygen per month.

A senior officer of the company said "In the pre-covid period, we supplied gas for industries only, but as per the government order, we are now supplying oxygen to hospitals for Covid-infected patients."

He also said now the company is focusing more to invest in the production of medical oxygen. And that is why, it has secured robust retained earnings by not declaring more dividends to the shareholders.

In its financial statement, the multinational company said the pre-pandemic demand for medical oxygen was about 30 – 35 tonnes per day, which surged to 70–75 tonnes per day during the pandemic. To meet the increased demand, the company's Narayanganj plant is being operated at full capacity. In addition, the closed and mothballed Chattogram plant was brought into operation. As production in the company's two plants were not enough to meet the local demand, medical oxygen had to be imported from Linde units in India.

Amid the pandemic, Islam Oxygen already has increased its annual production capacity to 2.5 crore cubic metres, said its Managing Director Nurul Islam in a road-show event in the capital on Monday.

The company has announced to collect Tk93 crore through initial public offering (IPO), with an aim to nearly double its production capacity by setting up a new plant.

The MD said if it can get its IPO approved, the company's production capacity would cross 4.5 crore cubic metres.

He further said, the expansion will help Bangladesh to be self-sufficient in the increasingly needed medical and industrial gases by reducing the foreign dependence.

The industry insiders said the country is still lagging behind in oxygen production. Hospitals in particular do not have the vehicles and cylinders needed to deliver oxygen. Therefore, many people have lost their lives due to lack of oxygen during the ongoing pandemic. So, oxygen producing companies need to increase their investments.