The cut-off price of shares in Lub-rref (Bangladesh) Limited has been set at Tk30 each after bidding by eligible institutional investors.
As per the book building method, eligible institutional investors took part in the price discovery.
At the end of the bidding process, with a proposed rate between Tk13 and Tk60, the cut-off price was set at Tk30, according to the Dhaka Stock Exchange (DSE).
According to the rules of the book building method, shares will be sold to general investors at a 10% discount on the cut-off price.
Institutional investors will be offered 50% of the shares at the cut-off price. The remaining 50% will be offered to other investors, including general investors and non-resident Bangladeshis.
The construction and engineering company seeks to raise Tk150 crore through an IPO.
The Chittagong-based company is due to use the Tk150-crore IPO fund to install new machinery at its plant and repay some of its bank loans.
Lub-rref (Bangladesh) supplies "BNO Lubricants" brand lubricants across the country.
Earlier, the Bangladesh Securities and Exchange Commission (BSEC) had allowed the company to determine the cut-off price of its shares through bidding by eligible investors.
The lubricant manufacturer will invest Tk98 crore to expand its existing manufacturing plant, which would enable the company to capture 20% lube oil market share, from the existing 8%, according to Lub-rref's IPO prospectus.
According to the entity’s audited financial statements for the year ending on June 30, 2019, the company’s weighted net asset value per share was Tk31.93 while earnings per share (EPS) was Tk2.08.
NRB Equity Management Limited acts as the issue manager of the company’s IPO.
