IFAD Autos to buy equity stake of Gulf Oil Bangladesh

IFAD Autos Limited, a leading assembler and seller of vehicles, has recently signed an agreement with Gulf Oil Bangladesh Limited (GOBL) on buying 49% of its equity stakes at a cost of USD1.685 million. The company made the announcement by a price sensitive information (PSI) statement on Thursday after the end of trading hours. GOBL, the subsidiary company of Gulf Oil International Limited (UK), is engaged in importing and selling lubricants, greases and car care products in Bangladesh. Purchase of the new company will diversify the revenue stream of IFAD Autos, which currently deals with only assembling and selling of vehicles and spare parts, said an equity research analyst. IFAD Autos will finance the investment with its own fund and the management expects the investment to contribute a profit of approximately Tk4.36cr next year, said the statement. According to the Dhaka Stock Exchange website, IFAD Autos currently has 15.5 crore shares outstanding, suggesting the expected profit next year from the investment in GOBL will be Tk0.28 per share. On April 30, IFAD Autos reported earnings per share of Tk2.01 during the first nine months (ending in March 2017) of its operation in Fiscal Year 2017. Stock price of IFAD Autos closed at Tk137.4 on Thursday after registering a gain of 6.5% over the last week. The stock was the mostly traded in Dhaka Stock Exchange last week contributing 3% to the total turnover.