Best Holdings' stock trading begins today

Best Holdings Limited, the proprietor of Le Meridien Dhaka, is set to initiate the trading of its shares on both the Dhaka Stock Exchange (DSE) and Chittagong Stock Exchange (CSE) under the 'N' category on Tuesday.

Best Holdings has secured a listing in the travel and leisure sector following a successful initial public offering (IPO) through the book-building method, raising Tk350 from the stock market.

According to the DSE, the trading code for the company is BESTHLDNG and the DSE company code is 29005.

Earlier, in October 2023, Best Holdings got approval from the Bangladesh Securities and Exchange Commission (BSEC) to raise funds from the stock market to finance its ongoing projects.

Determining the cut-off price at electronic bidding by the eligible investors in November last year, the cut-off price of its shares was fixed at Tk35 each.

The eligible investors including institutional investors and mutual funds bought 25% of the company's shares at the cut-off price. While the general investors got an allotment of shares at a 30% discounted price of Tk24 each.

The cut-off price is the price at which institutional investors have primary shares allocated for them in an IPO under the book-building method.

On 30 January this year, Best Holdings successfully allotted the initial public offering shares (IPO) to the general investors.

General investors living in the country, who applied for IPO shares of the company for Tk10,000 got 86 shares each while the non-resident Bangladeshi applicants got 101 shares for every Tk10,000 application.

Before starting subscriptions by the general investors, the BSEC had lifted the bar in IPO applications so that general investors could apply as much as they wanted.

However, later the BSEC had capped the limit up to Tk15 lakh for getting allotment of shares.

Usually, investors could apply for getting shares allotted by Tk10,000 in the primary market.

According to Best Holdings' financials, in October-December of 2023, its consolidated profit stood at Tk37.74 crore. Its consolidated profit stood at Tk71.66 crore in the six months from July to December.

According to the company, Best Holdings will use 50% of the fund (Tk176 crore) for building construction and other civil works, 33% (Tk115.6 crore) for repayment of existing liabilities, and around 13% for local machinery and equipment acquisition.

Best Holdings is in the process of raising fresh funds to build a resort at Bhaluka upazila in Mymensingh. The cost of the total project, which will offer world-class hospitality outside the capital, is Tk1,586.91 crore, as per the prospectus.

In this project, the IPO and the company's fund will contribute Tk755 crore and the rest will come from loans.