The cut-off price of shares of Esquire Knit Composite Limited (EKCL) has been set at Tk45 each, after bidding by eligible institutional investors.

As per the book building method, eligible institutional investors took part in the price discovery of the shares by bidding between 5pm on Monday and the same time on Thursday. At the end of the bidding process, with a proposed rate between Tk53 and Tk45, the cut-off price was set at Tk45.508.

EKCL, a unit of Esquire Group, will raise Tk1.50 billion from the capital market for business expansion through the Initial Public Offering (IPO).

The export-oriented knit garments factory held a road show for the IPO in April 2017. Prime Finance Capital Management is the issue manager for the EKCL IPO.

Book building is a process through which an issuer attempts to determine the price to offer for its shares based on the demands of institutional investors.

As per the book-building method, institutional investors will be offered 60% of the shares at the cut-off price. The remaining 40% of the shares will be offered to other investors, including general investors and non-resident Bangladeshis, at a 10% discount on the cut-off price.

EKCL will use the proceeds from the IPO to buy machinery, for civil construction, and to meet IPO expenses.

The company’s weighted average Earning per Share (EPS) stood at Tk2.52 and its Net Asset Value (NAV) per share (with revaluation reserve) was Tk 45.83 at the end of June 30, 2017.

Located at Sonargaon in Narayanganj, EKCL was commercially launched in 2001, and has knitting, fabric dyeing and finishing facilities under one roof.

Source: Dhaka Tribune