Aramit Cement’s ‘No Dividend’ disappointed investors

Sharebarta24.com, Dhaka: The managers of Aramit Cement, a listed cement company, are cheating investors by not paying dividends despite their profits. Although it has made a profit for the first time since 2016, it has again announced that it will not pay dividends to investors. As a result, the shareholders of the company are expressing their displeasure. He also demanded to check the financial report of the company.

The company also reported a loss of Tk 1.32 per share in the first quarter of the just-ended financial year. However, in the second quarter, it can earn 1 taka 9 paisa per share. Then in the third quarter the income is another 72 paise. Investors were expecting a dividend after the quarter’s earnings per share rose to 48 paise at the end of the quarter.

Meanwhile, despite Aramit Cement being a good fundamentals company, many questions have arisen among the people as it has declared no dividend. Investors question how policy makers, including the government, are desperately working to improve the capital market, while Aramit Cement declares no dividends despite its profits. The matter of this company needs to be investigated by forming a special committee of the regulatory body.

Investors allege that Aramit Cement’s declared dividend has deceived investors. And if it does not cheat, then what is the reason for no dividend? Where the company is profitable, there is no reason not to pay dividends. Gains nominal value and companies pay dividends annually. Investors have demanded punishment for the company’s board of directors.

In this regard, Abdur Razzak, General Secretary of Sammilita Oikya Parishad, Bangladesh Capital Market Investors, said that companies like Aramit Cement are cheating investors in these difficult times of capital market. Investors are scrambling to declare a no-dividend as they do not recover from the landslide. We also have doubts about what the company will do in the future. On behalf of the investors, I demand appropriate punishment for them.

Prof Abu Ahmed, a capital market analyst, said that even with the EPS condition of 0.60 paise for Aramit Cement, no dividend is nothing but the worst manipulation of the directors. All shares will be affected by the December closing for such low mentality and low activities. Managers are arbitrarily declaring minimum dividends or no dividends for their own vested interests as there is no proper regulation on dividend payment. The regulatory body is also playing a silent role despite seeing these irregularities.

The company’s share price has jumped in the last one year in the hope of returning dividends. At this time the share price rose from a minimum of 13 rupees 20 paise to 74 rupees. However, on the day of declaration of dividend, the price stood at Tk 59.10 paise, slightly lower from the highest position.

In the last one year, the share price of the company has fluctuated from Tk 28.80 to Tk 48.50. Later, however, the price decreased. On the day of declaration of dividend, the share price was 36 rupees 90 paise. As the company returns to profitability, so does its asset value. At the end of June last year, the assets per share was 26 rupees 91 paise. This time it has been 29 rupees 13 paise.

Of this, the company has reported a loss of Tk 2.98 per share in 2016, Tk 4.57 per share in the following year, Tk 5.15 per share in 2019 and Tk 6.8 per share last year as per the company’s financial position on the DSE. However, this year’s financial report shows last year’s loss of Tk 5.81 per share. This time the profit per share is 80 paise. The company’s board of directors made the decision on Thursday after reviewing the accounts for the fiscal year ended June 30.

Investors in this company can be at least a little relieved to be able to earn 80 paisa per share even if they do not receive dividends. Earlier, the company had incurred losses for four consecutive years from 2016 to 2020. Of this, in 2018, 2 taka 96 paise per share,

The company reported a loss of Tk 4.58 per share in the following year, Tk 5.15 per share in 2019 and Tk 6.8 per share last year as per the company’s financial position on the DSE. The company has set a record date of November 24 for dividends. The annual general meeting has been called on December 23 to approve the dividend.


Source: Share Barta 24 by www.sharebarta24.com.

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