To determine the cut-off price of Navana Pharmaceuticals Limited's shares, the Dhaka Stock Exchange (DSE) will arrange 72-hour bidding from 5 pm on 4 July.
Only eligible investors – institutions and approved provident, gratuity and pension funds – can participate in the process which will continue till 5 pm on 7 July.
Each investor needs to bid for a minimum of Tk20 lakh to participate in the bidding which will take place through the electronic subscription system of the country's premier bourse.
According to the securities regulator's direction, the institutions having a minimum of Tk3 crore investments in the secondary market will be eligible for the bidding. But in the case of provident, pension and gratuity funds, the minimum investment amount is Tk1.50 crore.
Earlier, on 19 June, the Bangladesh Securities and Exchange Commission (BSEC) allowed Navana Pharma to raise Tk75 crore from the stock market through an initial public offering (IPO) under the book-building method.
When a company wants a premium on the face value of its shares during an IPO, it has to go through the book-building method.
In this way, eligible investors determine the share price with a premium, which is called the cut-off price, and general investors get a 30% discount on the cut-off price.
Of the funds, the drugmaker plans to use Tk23.24 crore for a new general production building, Tk9.73 crore for a new utility and engineering building, and Tk17.85 crore for refurbishing the cephalosporin unit, Tk21.18 crore for loan repayment, and the rest for meeting IPO expenses.
Asian Tiger Capital Partners Investment Ltd and EBL Investments Ltd are the issue managers, while AFC Capital Limited is the registrar of Navana Pharma's IPO.
Navana Pharmaceuticals was established in 1986 under the Islam Group with a factory in Rupganj, Narayanganj.
Back in 2020, Anisuzzaman Chowdhury, Professor Dr Jonaid Shafiq, Imrana Zaman Chowdhury, Masuma Parvin, Zahara Rasul, Javed Kaiser Ally, Tarana Ahmed, and Sayeed Ahmed bought the company's shares from the Islam Group family.
Now, Anisuzzaman Chowdhury and Professor Dr Jonaid Shafiq, who are also directors of United Commercial Bank, are Navana Pharma's chairman and managing director, respectively.
Islam Group's Chairman Manzurul Islam holds 3% of Navana Pharma shares.
At the end of the first nine months of fiscal 2021-22, Navana Pharma's revenue increased by 38% to Tk366.64 crore, and net profits by 45% to Tk19.18 crore, compared to the same period in the previous fiscal year.
At the end of March, its total liabilities stood at Tk31 crore and short-term loans at Tk277 crore.
According to its audited annual report for fiscal 2020-21, its net profit stood at Tk20.23 crore, up from Tk13.74 crore in the previous fiscal year.
Revenues stood at Tk360.66 crore, which was Tk314.90 crore a year ago.