Govt makes setting up single-member companies easier
The government has brought in a major amendment to the Companies Act allowing setting up of single-member companies, a move that is expected to give a boost to entrepreneurship, draw investors and support the growth of SMEs. The cabinet gave its approval to the amendment on Monday and it would be now placed in parliament to set it in motion. Allowing single-member companies would draw local and foreign investors and improve the country’s ranking on the World Bank’s Ease of Doing Business Index, Cabinet Secretary KhandkerAnwarul Islam told reporters on Monday.The reform is a starting point to addressing a range of improvements in the regulatory regime that are needed to support the establishment and growth of microenterprises and small- and medium-sized enterprises, said ZahidHussain, a former lead economist of the World Bank’s office in Dhaka. The government is committed to moving rapidly from its current position of 168th in the Doing Business ranking to less than 100 within the next few years. Because of the new changes, 50,000 new firms would be set up in the country, according to an estimate. The changes to the Companies Act have been part of the $250 million budget support the government has received from the WB recently. Usually, a country has to fulfil conditions before securing budget support from the WB. Bangladesh was also supposed to meet some conditions before availing the financing in June.Bangladesh’s customs regime, which fails to exploit the opportunities of automation and risk-based approaches, is increasingly a binding constraint to the expansion of export-oriented industries. The country ranks 176th of 190 economies in the 2020 Doing Business “trading across borders” indicator, by far the worst-performing country in South Asia and far behind landlocked countries like Bhutan and Nepal, as well as India. To ensure quick clearance of goods and modernise the customs administration through trade facilitation, the government has formulated the new Customs Act.
Stocks back in the red amid low turnover
Stocks snapped a two-day gaining streak on Wednesday, as risk-averse investors went for short-term profit booking on sector specific shares ahead of Eid festival. The retail investors sold shares to pull out money ahead of Eid festival as only six trading days are left before Eid-ul-Azha vacation, said a leading broker. DSEX, the key index of the Dhaka Stock Exchange, went down by 9.0 points or 0.22 per cent to settle at 4,076, after adding 35 points in the past two sessions.Two other indices also edged lower. The DS30 index saw a fractional loss of 0.18 point to finish at 1,371 and the DSE Shariah Index shed 2.93 points to close at 945. Share prices flickered between green and red amid existence of floor price and gradual reopening of the economy, commented UCB Capital Management. Market analysts said investors remained worried about the ongoing Covid-19 pandemic and its impact on the country’s economy.The daily turnover is hovering around Tk 2.50 billion in the past few days as some of the investors refrained themselves from taking fresh position due to ongoing virus scare and floor price system, he said. Turnover, another important indicator of the market, remained low and amounted to Tk 2.47 billion on the country’s prime bourse, which was Tk 2.52 billion in the previous session.A total number of 65,829 trades were executed in the day’s trading session with a trading volume of 85.38 million shares and mutual fund units. The market-cap on the premier bourse also fell to Tk 3,168 billion on Wednesday, from Tk 3,171 billion in the previous session. Pioneer Insurance topped the turnover chart with shares worth Tk 117 million changing hands, closely followed by Grameenphone, Nahee Aluminum, Fine Foods and Bangladesh Shipping Corporation.The Chittagong Stock Exchange also backed to the red with its All Shares Price Index (CASPI)-losing 14 points to close at 11,607 and the Selective Categories Index – CSCX -shedding 8.0 points to finish at 7,036.Of the issues traded, 43 gained, 54 declined and 99 remained unchanged on the CSE. The port city bourse traded 2.27 million shares and mutual fund units with turnover value of Tk 58 million.
IDCOL finances green energy projects
Infrastructure Development Company Limited (IDCOL) has financed the first Rooftop Solar project of FORTIS Group. The 428.22 kWp project will be implemented on the rooftop of K A Design Ltd, an RMG manufacturing concern of FORTIS Group, located at BoroBeraid, Badda, Dhaka, said a statement. The rooftop solar project is a part of the on-going green initiatives of FORTIS group to use more environment-friendly technology and become less dependent on grid electricity by using renewable energy sources. Electricity produced from this project will not only reduce electricity bills of K A Design Ltd., but also reduce the diesel consumption during load-shedding. In addition, the project owners can export unutilized electricity generated from the project to national grid through Net Metering Guideline 2018. Currently the unit cost of electricity from rooftop solar falls below Tk 8 and this makes the investment very lucrative. The project will be implemented at a total project cost of Tk 29.9 million. Under the facility agreement, IDCOL is providing concessional loan of Tk 23.9 million. IDCOL has completed the first disbursement of the loan amount for the project and the project is expected to be completed very soon.
Marico Bangladesh holds 20th AGM
The 20th Annual General Meeting (AGM) of Marico Bangladesh Limited (MBL) was held virtually on Wednesday, said a statement. Saugata Gupta, Chairman of the board of directors of Marico Bangladesh Limited, presided over the meeting.A large number of shareholders attended virtually at the meeting wherein all proposed agenda were unanimously passed as per notice. The major agenda of the AGM were: adoption of the Director’s Report and Auditor’s Report along with the Audited Financials of 2019-2020, declaration of Final Dividend for the year ended March 31, 2020, re-election and appointment of the directors and appointment of Statutory Auditors. During the AGM, a final cash dividend of 200 per cent (equivalent to Tk. 20 per share) was confirmed and approved. This was preceded by three interim cash dividend of 750 per cent (equivalent to Tk. 75 per share) declared and paid by the company quarterly in this financial year – bringing the total cash dividend to 950 percent (equivalent to Tk. 95 per share) for the year ended March 31, 2020. Speaking about the performance of the company, Saugata Gupta said that the Company’s net profit after tax stood at Tk 2.65 billion with a topline of Tk 9.80 billion. Consequently, the earnings per share (EPS) stood at Tk 84.01.
‘Digital Loan’ launched on pilot basis by City Bank, bKash
City Bank has launched a collateral-free Digital Loan, whereby users can request and receive loans of up to Taka 10,000 instantly through bKash. This is a pilot initiative targeting a limited group of selected bKash users. Under the pilot initiative, bKash users can request a loan from City Bank from the bKash App, receive the loan disbursement into their bKash accounts as well as repay the loan from their bKash accounts.City Bank has initiated this pilot scheme with the approval of Bangladesh Bank, and aims to expand access to finance to unbanked populations and contribute towards the journey of financial inclusion, according to a statement. Upon successful completion of the project, City bank will commercially launch the Digital Loan to eligible bKash users, subject to approval from Bangladesh Bank for commercial launch.City Bank will closely monitor users’ loan payment behaviour and determine whether users will be eligible for loans in the future, along with fulfilling City bank’s regulatory obligations to report any loan defaulters to the Bangladesh Bank.To avail the loan under the pilot initiative, eligible users will need to click the ‘Loan’ icon on the bKash app and enter the desired loan amount within the loan limit approved by City Bank, as well as accept the loan terms and conditions. Users will also have to give consent to share their KYC information, available with bKash, with City Bank before availing the Digital Loan. After successfully entering the bKash PIN, the loan amount will be instantly disbursed into the user’s bKash account.
Number of e-GP tenders crosses 4 lakh
The number of tenders invited online in Bangladesh has gone past four lakh in an indication of the country’s race towards digitalisation. This is a landmark achievement of the electronic government procurement (e-GP) system introduced by the Central Procurement Technical Unit (CPTU) of the Implementation Monitoring and Evaluation Division, according to a press release. Prime Minister Sheikh Hasina rolled out the e-GP portal in 2011 as part of digitalising public services. Now, the total value of the tenders is Tk 410,000 crore.Currently, there are 1,365 procuring agencies in the country. As of yesterday, 1,343 agencies registered with the e-GP system. The number of tenderers registered with e-GP stood at 74,395. Both procuring agencies and tenderers embraced the ICT-based digital procurement system as it has reduced physical hassles. It also saves time and costs, the press release said. In Bangladesh, about 80 per cent of the annual development programme and 45 per cent of the national budget is spent on public procurement.The Washington-based lender has supported the government to put in place the e-GP. The country now has 60 national certified procurement trainers and 37,000 officials have been trained in procurement and the use of e-GP. A key transparency measure is a publication of 100 per cent of procurement notices and contract award information, the WB said. Procurement lead time (from invitation to contract signing) for all tenders decreased by 28 per cent, from 86.7 days in the fiscal year 2011-12 to 62.2 days in FY2018-19. A 2017 study by Wahid Abdallah, then a research fellow at the Brac Institute of Governance and Development, showed that the e-GP holds enormous potential benefits for the country. Each Tk 1 spent on such efforts will do a phenomenal Tk 663 of good, the study found.