Key Particulars of the IPO Major Products of the Company Analysis... · M. Zakir Chowdhury MD & CEO...
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Source: Research Department, Prime Bank Investment Limited (PBIL). Email: [email protected] IPO PROFILE OF New Line Clothing Limited Key Parculars of the IPO Ticker NEWLINE Face Value (Tk.) 10 Offer Price per share (Tk.) 10 No. of Share (IPO) 30,000,000 No. of Pre-IPO Share 39,900,000 No. of Post-IPO Share 69,900,000 Issue Size (Offer Price) (Tk) 300,000,000 Pre-IPO Paid-up Capital (TK) 399,000,000 Post-IPO Paid UP (Tk) 699,000,000 Authorized Capital (Tk) 1,000,000,000 No. of Free Float Shares on Debut 22,500,000 Post-IPO EPS (3m, Mar 31, 2019) 0.39 Post-IPO EPS (9m, Mar 31, 2019) 0.84 Annualized EPS (12m, 2018-19) 1.12 NAVPs (as on June,2018) 24.23 PE at Tk 10 (Post-IPO) 8.93 Company Overview New Line Clothing Ltd was incorporated on May 23, 2000 as private limited company. New Line Clothings Limited has been using sophisticated machineries and technologies in order to produce high quality yarn dyed woven fabric. It helps the company to be competitive over the competitors in the market because of latest machineries and technolo- gies. The company offers complete apparel sourcing and thereby allowing us to offer an expansive array of products, taking advantage of strengths, skills and price advantages offered by each country. It has already proudly heralded its presence in the potential markets of Germany, UK and Aus- tralia. The principal activities of the company is to manu- facture various kinds of woven Garments for both ladies and gents including trousers, shirts, children wear, gents wear, female wear, jackets, Sportswear, denim garments etc. and marketing thereof. Newline’s professionals of pro- duction and merchandising teams with their vast practical experience in manufacturing merchandising combine forc- es to bring customers a well managed, proactive Time & Action calendar for every order & style. Veteran Textile professionals lead each team through organized quality processed with strict control at every stage from raw mate- rials and sampling, to bulk production and packaging. Lo- gistics department is fully equipped with all the latest in- formation of shipment particulars. The world-wide online communication with all prominent carriers enables us for getting into actual and real time information. Major Products of the Company Industry Overview Name of Sponsors and Directors Top Five Private Placement Shareholders Name Position Post IPO % Osman Khadem Chairman 6.85% M. Zakir Chowdhury MD & CEO 3.42% Sigma Technologies Ltd. Director 11.42% Md. Asif Rahman Director 3.42% Maruful Haque Chowdhury Director 3.42% Mashiul Haq Chowdhury Director 2.28% Md. Saiful Islam Helaly Independent Director N/A Syed Kamal Uddin Independent Director N/A Total 30.81% Ladies and gent’s trousers, shirts, children wear, gents wear, female wear, towel, brassier, socks, hooks, buttons Name No. of Shares Pre IPO % Lock In Mostafa Zamanul Bahar 3,890,000 9.75% 1 Yr. Mithy Islam Khan 3,890,000 9.75% Tartila Akhter Chowdhury 2,740,000 6.87% Afsana Jabin 2,740,000 6.87% Fatema Mahbub 2,700,000 6.77% The readymade garments industry acts as a catalyst for the development of Bangladesh. The industry has been making crucial contribution to rebuilding the country and its econo- my is none other than the readymade garment (RMG) indus- try, which is now the single biggest export earner for Bangla- desh. The sector accounts for 81% of total export earnings of the country. The apparel industry of Bangladesh started its journey in the 1980s and has come to the position it is in to- day.
Transcript of Key Particulars of the IPO Major Products of the Company Analysis... · M. Zakir Chowdhury MD & CEO...
Source: Research Department, Prime Bank Investment Limited (PBIL). Email: [email protected]
IPO PROFILE OF New Line Clothing Limited
Key Particulars of the IPO
Ticker NEWLINE
Face Value (Tk.) 10
Offer Price per share (Tk.) 10
No. of Share (IPO) 30,000,000
No. of Pre-IPO Share 39,900,000
No. of Post-IPO Share 69,900,000 Issue Size (Offer Price) (Tk) 300,000,000
Pre-IPO Paid-up Capital (TK) 399,000,000
Post-IPO Paid UP (Tk) 699,000,000
Authorized Capital (Tk) 1,000,000,000
No. of Free Float Shares on Debut 22,500,000
Post-IPO EPS (3m, Mar 31, 2019) 0.39
Post-IPO EPS (9m, Mar 31, 2019) 0.84
Annualized EPS (12m, 2018-19) 1.12
NAVPs (as on June,2018) 24.23
PE at Tk 10 (Post-IPO) 8.93
Company Overview
New Line Clothing Ltd was incorporated on May 23, 2000
as private limited company. New Line Clothings Limited
has been using sophisticated machineries and technologies
in order to produce high quality yarn dyed woven fabric. It
helps the company to be competitive over the competitors
in the market because of latest machineries and technolo-
gies. The company offers complete apparel sourcing and
thereby allowing us to offer an expansive array of products,
taking advantage of strengths, skills and price advantages
offered by each country. It has already proudly heralded its
presence in the potential markets of Germany, UK and Aus-
tralia. The principal activities of the company is to manu-
facture various kinds of woven Garments for both ladies
and gents including trousers, shirts, children wear, gents
wear, female wear, jackets, Sportswear, denim garments
etc. and marketing thereof. Newline’s professionals of pro-
duction and merchandising teams with their vast practical
experience in manufacturing merchandising combine forc-
es to bring customers a well managed, proactive Time &
Action calendar for every order & style. Veteran Textile
professionals lead each team through organized quality
processed with strict control at every stage from raw mate-
rials and sampling, to bulk production and packaging. Lo-
gistics department is fully equipped with all the latest in-
formation of shipment particulars. The world-wide online
communication with all prominent carriers enables us for
getting into actual and real time information.
Major Products of the Company
Industry Overview
Name of Sponsors and Directors
Top Five Private Placement Shareholders
Name Position Post IPO
%
Osman Khadem Chairman 6.85%
M. Zakir Chowdhury MD & CEO 3.42%
Sigma Technologies Ltd. Director 11.42%
Md. Asif Rahman Director 3.42%
Maruful Haque
Chowdhury Director 3.42%
Mashiul Haq Chowdhury Director 2.28%
Md. Saiful Islam Helaly Independent Director N/A
Syed Kamal Uddin Independent Director N/A
Total 30.81%
Ladies and gent’s trousers, shirts, children wear, gents
wear, female wear, towel, brassier, socks, hooks, buttons
Name No. of
Shares Pre IPO
% Lock In
Mostafa Zamanul Bahar
3,890,000 9.75%
1 Yr.
Mithy Islam Khan 3,890,000 9.75%
Tartila Akhter Chowdhury
2,740,000 6.87%
Afsana Jabin 2,740,000 6.87%
Fatema Mahbub 2,700,000 6.77%
The readymade garments industry acts as a catalyst for the
development of Bangladesh. The industry has been making
crucial contribution to rebuilding the country and its econo-
my is none other than the readymade garment (RMG) indus-
try, which is now the single biggest export earner for Bangla-
desh. The sector accounts for 81% of total export earnings of
the country. The apparel industry of Bangladesh started its
journey in the 1980s and has come to the position it is in to-
day.
Source: Research Department, Prime Bank Investment Limited (PBIL). Email: [email protected]
IPO PROFILE OF New Line Clothing Limited
Key Observations
Operating Profit Margin & Net Profit Margin
Ratio 2017 2016 2015 2014 2013
Current Ratio 1.45 1.64 1.96 3 2.26
ROA 2.84% 1.95% 2.31% 6.80% 6.74%
ROE 5.86% 3.83% 4.46% 11.8% 11.5%
Debt-Equity 0.98 0.91 0.82 0.77 0.81
Gross Profit Margin
12.9% 15.7% 14.7% 14.3% 14.2%
Operating Profit Margin
7.3% 9.1% 8.7% 10.6% 13.0%
Net Profit Margin
3.55% 2.83% 2.92% 6.97% 7.16%
Financial Indicators
Post IPO total shareholding percentage of the company’s sponsors and directors would stand at 74.13% .
Over the course of the last five financial years, Es-quire Knit Composite Limited has a CAGR of for Revenue 5.61% and for Net Profit Margin –10.49%.
Labor unrest or strikes makes the industry in Bangladesh vulnerable and susceptible to compet-itive pressure which arises from other low cost countries.
The Company does not have any supplier, which contribute 10% or more of its raw material or fin-ished goods.
The decline of the profit margins over the last five financial years could be a cause for concern for the company going forward.
New Line Clothing Limited has no subsidiary Company.
Since the company is export oriented, the compa-ny faces a significant risk to exchange rate fluctua-tion
Revenue Earned During Last Five Financial Years
Year Utilization (%)
2018 75%
2019 75%
2020 80%
Capacity Utilization (Yearly)
Financing of IPO fund
Particulars % No. of Ordi-
nary Shares
Issue
price
Issue Amount
(Taka)
Eligible
investor
(EI)
EI 50% 12,000,000
10
120,000,000
Mutual
Funds
and CIS
10%
3,000,000
30,000,000
General
public
(GP)
GP 40%
12,000,000
120,000,000
NRB 10%
3,000,000
30,000,000
Total 100% 69,900,000
699,000,000
Return on Assets & Return on Equity
7.3%
9.1%
8.7%
10.6%13.0%
3.6%2.8%2.9%
7.0%
7.2%
2.5%
5.0%
7.5%
10.0%
12.5%
20172016201520142013Operating Profit Margin Net Profit Margin
2.84%1.95%
2.31%
6.80%6.74%
5.86%3.83%4.46%
11.80%11.57%
1.50%
4.00%
6.50%
9.00%
11.50%
20172016201520142013ROA ROE
2,081
1,607 1,7361,977
1,673
2017 2016 2015 2014 2013
Revenue
Source: Research Department, Prime Bank Investment Limited (PBIL). Email: [email protected]
IPO PROFILE OF New Line Clothing Limited
Implication Schedule of IPO Proceeds
Particulars Amount %
Acquisition of Plant & Machinery
117,682,660 41.4%
Extension of Factory Building 76,382,990 39.4%
Long term loan repayment 90,000,000 20.2%
Issue Date of Prospectus: January 24, 2019
Year End: June
Issue Manager: Banco Finance & Investments Ltd.
Sandhani Life Finance Ltd.
Southeast Bank Capital Services Ltd.
Dividends Declaration
Disclaimer
Market PE 13.04
Sector (TEXTILE) PE 17.91
PE – HFL 13.84
PE – SIMTEX 13.02
Price relative to different prices
Other IPO Details
Particulars Approximate period of project completion & commercial op-eration
Plant & Machinery Within 9 months of obtaining IPO
proceeds
Civil Construction Within 9 months of obtaining IPO
proceeds
Bank Loan Immediately after the subscrip-
tion n of the IPO fund
Period On Debut 6-months 9-months
Portion Initial 50% Next 25% Last 25%
Date 27.05.19 27.11.19 27.02.20
Use of the Proceeds of IPO (in mn)
Lock-in Free Period for EI: (from Issue Date of Prospectus)
This Document/Report has been prepared and issued by Prime
Bank Investment Limited on the basis of the public infor-
mation available in the market, internally developed data and
other sources believed to be reliable. Whilst all reasonable
care has been taken to ensure that the facts and information
stated in the Documents are accurate as on the date men-
tioned herein. . If any person takes any action relying on this
Document, shall be responsible solely by himself/herself/
themselves for the consequences thereof any claim or de-
mand for such consequences shall be rejected outright by PBIL
or by any court of law.
Price 25 30 35 40 45 50
PE 22.3 26.7 31.3 35.7 40.2 44.6
PE relative to other companies
Email: [email protected]
Contact: +8802-48810315-6
CORPORATE OFFICE
Tajwar Center (5th Floor)
House: 34, Road: 19/A, Block: E
Banani, Dhaka-1213
Contact Us
Prepared by
Rahat-Ul-Amin Head of Research
Shakawat Hossain Research Analyst
Syed Reazul Haque Research Analyst
Year 2017 2015 2014 2016 2013
Cash (%) Nil Nil Nil Nil Nil
Stock (%) Nil Nil Nil 303% Nil
The major portion of IPO amount will be used for acquisi-
tion of plant and machinery and for the extension of the
factory building. The rest of the amount will be used to pay
of f the bank loan.
