Borak Real Estate going public to raise Tk400cr, roadshow on 18 Oct
BMSL Investment Limited and Swadesh Investment Management Limited will be the issue managers for the company’s IPO
Borak Real Estate Limited — a subsidiary of the publicly listed Unique Hotel and Resorts Limited — is set to conduct a roadshow this 18 October with the aim of raising Tk400 crore through an initial public offering (IPO).
On the roadshow, the real estate company's management will explain the firm's financial strength and future opportunities to the investors.
Borak Real Estate's IPO will be under the book-building method in which institutional investors bid to set a reference price of the shares, more commonly known as the cut-off price. General investors will get a discount on the cut-off price.
Keep updated, follow The Business Standard's Google news channel
According to the Public Issue Rules, companies that want no premium over face value for their primary shares go public under fixed-price method, while premium seeking firms need to follow the book-building method.
A senior official at the company said Borak Real Estate plans to use Tk100 crore of its IPO fund to repay its high-cost bank loans, and the rest to implement new construction projects.
BMSL Investment Limited and Swadesh Investment Management Limited will be the issue managers for the company's IPO.
Borak Real Estate was established in 1991. It builds urban luxury apartments and commercial spaces. The 20-storied Unique Trade Centre, and five-star hotel The Westin Dhaka are two of its notable projects in the capital.
The company has a 19.37% stake at Unique Hotel and Resorts — the owner of The Westin Dhaka.
Unique Hotel has been listed on the stock market since 2012. On Tuesday, its shares closed at Tk65 apiece at the Dhaka Stock Exchange. The company recommended a 20% cash dividend in the fiscal 2022-23.
In 2010, Borak Real Estate and Unique Hotel — concerns of the Unique Group — signed an agreement for establishing a five-star hotel named Sheraton Dhaka under the condition of 50-50 profit sharing.
As per the deal, Borak has provided 100% space along with surrounding area for the hotel's construction while Unique Hotel has borne the costs of construction and operations.
Currently, Eastern Housing is the only real estate company that is listed on the stock exchanges. Its shares closed at Tk91.50 each at the DSE on Tuesday. It recommended a 25% cash dividend to its shareholders for the last fiscal year, where its earnings per share was Tk7.37, which was 25% higher than the previous fiscal.
