Robi on Thursday held the lottery draw for allocation of its record-setting initial public offering (IPO) among general investors.
The much-anticipated IPO created a craze among retail investors in the capital market, said several market participants to Dhaka Tribune.
A total of 465,290 applicants were selected using the lottery draw out of 1,280,425 applications. The list of lottery winners can be found here.
The company raised Tk 387.7 crore from the general investors including eligible institutional investors through the IPO.
Applications submitted for the IPO exceeded the IPO amount by 5.74 times, indicating a high demand for the stock among investors.
This suggests the pressure has amped up on the country’s second-largest mobile operator to improve its financial performance to satisfy the heightened shareholder expectations.
Last month, Robi posted a 77.2 per cent slump in profit between July and September from a year earlier. Its main competitor Grameenphone posted a 22.4 per cent profit growth for the quarter.
Robi’s third-quarter’s takings take its profit in the first nine months of 2020 to Tk 116.1 crore, up 1.9 per cent year-on-year.
“Although Robi has a decent top line, the numbers drop significantly when it comes to the bottom line due to inefficiency in managing expenses,” said a recent report of Brac-EPL.
Its asset turnover is half of Grameenphone’s without any trend in improvement in efficiency.
Its net property, plant and equipment (PPE)/site is Tk 84 lakh, which is more than double of Grameenphone’s net PPE/site of Tk 38 lakh.
“Therefore, it seems like Robi is inefficient in utilising its funds to construct sites for its subscribers,” the report said.
Robi has a much lower operating margin than that of Grameenphone due to the higher cost of revenue, maintenance and depreciation expenses.
Moreover, due to a high debt number, the interest and lease payments pull down the earnings as well, the report added.
Robi Axiata is a joint venture between Axiata Group Berhad of Malaysia and Bharti Airtel of India. Axiata holds 68.7 per cent controlling stake in the entity, and Bharti holds the remaining 31.3 per cent share in the company.
The company commenced operations in 1997 as Telekom Malaysia International (Bangladesh) with the brand name ‘Aktel’. In 2010, it was rebranded as ‘Robi’ with the company changing its name to Robi Axiata.