RAK Ceramics launches book-building method

The RAK Ceramics (Bangladesh) Ltd has successfully completed the price discovery of its shares through bidding by Eligible Institutional Investors (EII) under the book- building method, the first of its kind in Bangladesh.
IDLC Finance Ltd is the lead issue manager while BRAC EPL Investments Ltd is the joint issue manager to this IPO and Prime Finance and Investment Limited is the Registrar to the issue.
The book building is a process where market participants determine price of security. Bidding of company shares was conducted in web-based software available at ‘www.bbsbangladesh.com’, which was introduced jointly by Dhaka Stock Exchange (DSE) and Chittagong Stock Exchange (CSE).
The online registration was open from February 25 to 28h while bidding was open from March 1-3, said a press release yesterday.
The company is issuing a total of 34.51 million ordinary shares, of which the EII quota is 6.902 million shares.
The institutional quota was oversubscribed more than 15 times, 20 per cent advance money deposited was Tk 1,020 million and total value equivalent to Tk 5,058 million.
Face value of each share is Tk 10 while the indicative price is Tk 40 and the highest bidding price was Tk 48, lowest bidding price was Tk 40 while the weighted average price and the cut- off price were both Tk 48.
A total of 175 EII registered with the system of which 168 participated in the bidding.
Of the rest of the issue, 10 per cent is reserved for Non- Resident Bangladeshis, 10 per cent is for Mutual Funds and 60 per cent is for the general public. Tentative date for public subscription is from April 11 to 18 and market lot is 200 shares.
RAK Ceramics, an UAE owns 73 per cent of the company having market shares of over 1/4th of tiles and more than 2/3rd of sanitary ware products.

Courtesy of The Independent