Dhakathai Alcomaxx files for going public

Dhakathai Alcomaxx PLC – a leading manufacturer of aluminium profiles for architectural and industrial purposes – has filed for raising Tk30 crore through an initial public offering (IPO) to expand its business and meet growing demand in the local market.

The company plans to use Tk19 crore for expansion, Tk5 crore for working capital, Tk4.71 crore for loan repayment, and Tk1.28 crore for IPO expenses.

According to its application with the Bangladesh Securities and Exchange Commission (BSEC), the manufacturer plans to issue 3 crore shares via the fixed price method.

Md Mahfug Alam, company secretary of Dhakathai Alcomaxx, told The Business Standard that the demand for aluminium profiles in Bangladesh is experiencing significant growth, driven by numerous mega projects, rapid urbanisation, and ongoing construction activities.

He noted that local companies currently meet 90% of the demand, which is expanding at a rate of 15% to 20% annually, while the remaining 10% is fulfilled through imports from China.

Presently, Dhakathai Alcomaxx holds a market share of approximately 20% to 22% in the local aluminium profiles market. The company aims to capitalise on the increasing demand by expanding its market share through the introduction of compliant and high-quality products.

However, in recent years, operational costs for aluminium profiles have risen significantly due to higher raw material and fuel costs, squeezing profit margins for industry companies.

From July to December 2023, the company reported revenues of Tk213.96 crore, up from Tk193.09 crore in the same period the previous year. Its net profit after tax increased by 16% to Tk7.35 crore, up from Tk6.33 crore year-over-year.

Earnings per share for the period were Tk0.55, and the net asset value per share stood at Tk11.32 as of December 2023. Prime Bank Investment Limited is serving as the issue manager for the company.

Founded in 1997 through a collaboration of local and international entrepreneurs, Dhakathai Alcomaxx is led by Kareem Din, who serves as the director and chairman with 26 years of experience in the aluminium industry.

Industry experts have highlighted substantial investments totalling approximately Tk1,000 crore in Bangladesh’s aluminium extrusion sector.

The market demand for aluminium profiles is nearly 60,000 tonnes annually. Currently, 10 local companies together satisfy 90% of the domestic demand for these products.

Key players in the sector include KAI Bangladesh Aluminium, Dhaka Thai, PHP Group, Chung Hua Aluminium Industry, Bangladesh Thai Aluminium Ltd, and Nikki Thai Aluminium Ltd.

Moreover, the sector employs approximately 30,000 people, significantly contributing to employment opportunities in Bangladesh.