Fin424: Financial Market

Homework-02

Submitted By:
Maliha Tahsin Shafa
Id:19104153
Section:03

Submitted to:
Mr. Salim Afzal Shawon, CFA (BRAC Business School)

Date:
15th April 2022
 1.List out all VC and PE investors active in Bangladesh. List Investments they have
made in 2019-2021. Include brief description.
Ans-
Announ Transactio
Name of Institute Invested In cement n Type Amount Description
Date
Startup Bangladesh Moner Mar 31, Seed round undisclos Moner Bondhu is a platform to
Limited (VC) Bondhu 2021 ed provide care for mental health and
The ICT Ministry's well-being service.
flagship venture capital Dhaka Cast Mar 31, Seed round undisclos Dhaka Cast is a health care startup
fund, was established in 2021 ed focused to support diabetic patients
March 2020 with an and fully run by experienced and
authorized capital of qualified doctors.
BDT500 crores. It is the EduHive Mar 31, Seed round undisclos EduHive is an EdTech platform
first and only venture 2021 ed based in Bangladesh that makes
capital fund supported by education digitally available.
the government of the
People's Republic of
Bangladesh. It had made
15 investments in which
they are the lead investor
in four of them. Their
most recent investment
was in Truck Lagbe,
which was raised 2022.
IDLC Finance (VC) Truck Lagbe Sep 20, Series-A $4M Truck Lagbe is bringing
IDLC is Bangladesh's 2021 transparency to the logistics market
largest non-banking in Bangladesh through its booking
financial institution. platform.
IDLC Finance has
invested in four
companies. Arogga raised ChalDal Feb 28, Series-B $4.6M Chaldal is an online platform for
$1.3 million on 2022, 2020 grocery and delivery based in
which was their most Dhaka, Bangladesh.
recent investment.
Maslin Capital Ltd E-Desh Apr 21, Series-A $235k E-Desh is an e-commerce logistics
(PE/VC) 2021 company with experience,
It is an alternative capabilities, functional
investment firm focused competence, and technological
exclusively on supporting embedment that delivers
visionary founders at the comprehensive logistic solutions.
early stages of company
formation and growth.
Anchorless Shikho Jul 28, Seed Round 1.3 Shikho is an education technology
Bangladesh (VC) 2021 million firm in Bangladesh that is
An early-stage venture developing a hyper-localized
investment fund focused digital learning ecosystem for
on advancing the pupils.
Bangladeshi startup Alice lab May 11, Seed Round $500K Alice is a omni-channel
ecosystem through access 2021 conversational AI based SAAS
to global resources. platform to Boost Sales, Automate
Support and Reduce Cost!
 Anchorless Bangladesh Maya Feb 8, Seed Round $2.2M Maya is a mobile-based digital
has made 6 investments. 2021 wellbeing assistant that directly
Their most recent connects to experts, doctors, and
investment was when therapists.
Shikho raised. Gaze Jun 16, Seed Round $830K Gaze is building password less 1-
2020 click authentication.
Loop Freight May 18, Seed Round $700K Loop is a technology-enabled
2020 logistics company for truckload
freight.
SBK Tech Ventures LOOX Dec 1, Pre-seed $115K LOOX is Bangladesh's first
(VC) 2021 round fashion-focused online
It is a social impact marketplace, making fashion
technology fund that purchasing authentic, enjoyable,
invests in early-stage tech and real.
platforms in Jatri Sep 13, Seed round $1.2M Jatri is a public transportation
underdeveloped 2021 travel planner, digital ticketing
economies. SBK Tech platform, and mobility marketplace
Ventures has invested in 5 that helps drivers provide safe and
companies. Their most dependable transportation.
recent investment was on Praava Mar 8, Series-A $10.6M Praava Health is a patient-driven
Jan 25, 2022, when Health 2021 company disrupting the healthcare
Shajgoj raised $2M. standard for Bangladesh's 170
million citizens.
BD Venture (VC) Handy mama June 1, Seed funding $300k HandyMama is the leading on-
An outcome of a group of 2019 demand cleaning and handymen
leaders from Bangladesh's services platform of Bangladesh.
financial and C-Work May, Seed funding BDT C-Work Microjob Limited, a
entrepreneurial 2019 500k blockchain based crowdsourced
ecosystems working microjob platform,
tirelessly to promote Beetles ltd - - Undisclos Beetles' goal is to keep cyber
innovative and promising ed thieves at bay while also protecting
seed, early, and growth the client's data.
stage entrepreneurs and
firms by facilitating
financing, consulting, and
other essential services.
They've made a total of 8
investments thus far.
Tiger IT Foundation SohoPathi Sep 21, Pre seed $50K “Sohopathi" is a social learning
A foundation working for 2020 round platform for connecting students
the social welfare of with their best fit educators.
Bangladesh and organizer
of the National "Tiger
Challenge" along with
MIT Solve

2.From DSE, collate information on IPO listing requirements for any private company.
Choose at least IPO within 2019-2022 and find its IPO expenses as % of total expenses
(you can get that from IPO prospectus and/or other sources)

Ans-
 To get listed via IPO in Bangladesh, a company must fulfil some requirements-

➢ The company must make an offer of at least 10% of its paid-up capital, or Tk. 15 cores
at face value, whichever is more.
➢ It has made no adjustments, including the increase in paid-up capital following the date
of the audited financial statements included in the draft prospectus.
➢ The panel auditors examine the company's most recent financial statements time to time
in accordance with the Bangladesh Auditing Standards and Companies Act of 1994.
➢ It has prepared its financial statements in compliance with the Securities and Exchange
Rules of 1987, as well as the conditions of the International Financial Reporting
Standards (IFRS) / International Accounting Standards (IAS) in Bangladesh.
➢ It has consistently attended Bangladesh's annual general meeting.
➢ It has worked in accordance with the DSE board's guidelines.
➢ In the production of the prospectus, it followed with all of these rules' criteria.
➢ At the time of the application, the company have not incurred any losses.
➢ It has followed the Commission's asset valuation rules.
➢ The Issuer or any of its directors are not in default with a bank.
➢
Year Company Name Total Expense IPO Expense % Of Total
IPO expense
2019 Ring Shine Textiles Limited 1,500,000,000 36,000,000 2.40%
Coppertech Industries Limited 200,000,000 15,000,000 7.50%
Sea Pearl Beach Resort & Spa ltd 150,000,000 21,678,448.00 7.23%
Silco Pharmaceuticals Limited 300,000,000 21,678,448.00 7.23%
New Line Clothings Limited 300,000,000 15,934,350 5.31%
Genex Infosys Limited 200,000,000 17,000,000 8.50%
S. S. Steel Limited 250,000,000 20,567,500 8.22%
2020 Robi Axiata Limited 5,237,933,340 80,209,766 01.53%
Crystal Insurance Company Limited 160,000,000 10,728,500 6.70%
Dominage Steel Building ltd 300,000,000 19,576,000 06.53%
Associated Oxygen Limited 150,000,000 19,443,500 12.96%
Express Insurance Limited 260,790,000 15,000,000 5.75%
Bond of Ashuganj Power Station Company 1,000,000,000 42,100,000 (4.21%
Ltd.
2021 ACME Pesticides Limited 300,000,000.00 18,501,000 06.17%
Sena Kalyan Insurance ltd 160,000,000.00 11,000,000.00 6.87%
South Bangla Agriculture & Commerce 1,000,000,000.00 48,145,864.00 4.81%
Bank Ltd
Sonali Life Insurance Company Limited 190,000,000 12,000,000 6.32%
Desh General Insurance Company Limited 160,000,000 9,566,500 5.97%
NRB Commercial Bank Limited 1,200,000,000 39,476,376 3.29%
eGeneration Limited 150,000,000 17,611,000 11.74%
Taufika Foods and Agro Industries Limited 300,000,000 28,000,000 09.33%
2022 Union Bank Ltd 4,280,000,000 65,000,000 1.51%
BD Thai Food and Beverage Limited 150,000,000 11,000,000 7.33%
 Union Insurance Company Limited 193,609,040 11,627,721 6.01%

BD Thai Food & beverages Limited

Total Expense 150,000,000
Total IPO Expense 11000000(7.33%)

% Amount from total

SL Particulars Amount In TK Cost
1 Manager To the Issue Fees
Manager to the issue fees 3,000,000 2.00%
VAT against Issue Management Fee 450,000 0.30%
2 Listing Related Expenses:
Prospectus Submission Fees to DSE & CSE 100,000 0.07%
DSE and CSE Annual Fee 815,000 0.54%
Data Transmission Fee for DSE & CSE 400,000 0.27%
Fees related to Listing with the stock
exchanges 2,645,000 1.76%
3 BSEC Fees
Application Fee 50,000 0.03%
Consent Fee 600,000 0.40%
4 IPO Commission/Expenses: 0.00%
Underwriting Commission 262,500 0.18%
Auditors' Certification Fee 200,000 0.13%
5 CDBL Fees and Expenses:
Security Deposit 500,000 0.33%
Documentation fee 2,500 0.00%
Annual fee 100,000 0.07%
Connection Fee 6,000 0.00%
Initial Public Offering fee 122,250 0.08%
6 Printing, Publication and Others:
Publication of prospectus 312,500 0.21%
Abridge Version of Prospectus and Notice 434,250 0.29%
Notice for prospectus, Lottery, Refund etc. 200,000 0.13%
Lottery related expenses including BUET fee 800,000 0.53%
Total 7.33%

3.Provide market microstructure information for DSE (trading mechanism, circuit

breakers, floor brokers, categories, tick sizes, indices, different trading boards etc.).
Trading Mechanism- The stock market is a type of capital market in which different firms'
stocks are traded. The open cry-out auction technique was used to launch DSE floor trading.
Trading is now fully automated, thanks to the DSE and the central depository. Bids/offers,
depth, and required broker details are all stored in today's automated trading environment and
can be retrieved for future reference.
Circuit Breaker-The maximum permitted difference of the price (given as a percentage) of an
incoming order from the Circuit Breaker Base Price for that instrument is known as the Circuit
Breaker. If an order violates a circuit breaker, it will be rejected.
There is a limit how much a company's share price can rise or fall.
Price Limit Price change limit
Up to TK 200 10%
Above TK 200 to Tk 500 8.75%
Above TK 500 to Tk 1000 7.50%
Above TK 1000 to Tk 2000 6.25%
Above TK 2000 to Tk 5000 5%
Above TK 5000 3.75%

If a stock's closing price on the previous day is 200 or less than 200, it can rise or fall by up to
10%. If a stock's prior day's closing price falls between 200 and 500, it can increase or drop by
up to 8.75 %. And so on. Any company's IPO share has no price limit for the first two days,
which means it can be gone up or down at any limit. Furthermore, when a firm declares its
dividend amount, there is no price limit on that day.
Tick size-It is the smallest currency increment used to specify an order's price. Tick size must
be TK 0.10 according to BSEC.
Floor Broker-Investor clients use floor brokers as intermediaries, providing them the closest
thing to direct access to the exchange floor. Floor brokers are in charge of analysing market
data, prices, and competition in order to make the best possible deals on behalf of their clients.
Banks, mutual funds, pension funds, and even some affluent individuals are typical clients. A
floor broker earns commission on each trade they execute on behalf of a customer, therefore
getting the best offer is in their best interests. Floor brokers are not to be confused with floor
traders, who, unlike floor brokers, trade on their own account instead of their clients'.
Categories-There are some categories of Company’s in DSE:
A Category Companies-Companies that have held current annual general meetings on a
regular basis and distributed dividends at a rate of 10% or more in the previous English calendar
year
B Category Companies-Companies that convene annual general meetings on a regular basis
but have failed to declare a dividend of at least ten percent in the previous English calendar
year.
Z Category Companies-Companies that have not held their current annual general meetings
or declared any dividends, or that have been out of business for more than six months, or whose
accumulated loss after adjustment of revenue reserve, if any, is negative and exceeds their paid-
up capital.
G Category Companies-G Category Companies are basically Greenfield companies.
Companies that have not yet begun operations but are seeking subscribers to invest in their
business. They essentially demand capital in the primary market.
N Category Companies- Companies in the N- Category are those that are already in operation
and enter the primary market to collect money.
Indices-Currently, the Dhaka Stock Exchange calculates two indices: the DSE Broad Index
(DSEX) and the DSE 30 Index (DS30). Mutual funds, debentures, and bonds are not included
in any of the DSE Indices.
DSEX- Stocks must have a float-adjusted market capitalisation of more than 100 million BDT
to be eligible. Additionally, if a current index constituent's market capitalization falls below
100 million BDT but is greater than 70 million BDT, the company remains in the index as long
as it fits the other eligibility conditions.
DS30 - As of the rebalancing reference date, eligible equities must have a float-adjusted market
capitalisation of more than 500 million BDT.
DSES-This is a stock market index in Bangladesh. It's a subset of the Dhaka Stock Exchange
(DSE) and includes stocks from this index that comply with Shariah, the Islamic religious law.
Trading Board- The Dhaka Stock Exchange (DSE) has established an Alternative Trading
Board (ATB) for trading unlisted company securities, private placement bonds, sukuk, and
open and mutual funds. To be listed on ATB, a company's securities must be in demat form,
and it must be able to comply with the provisions of IFRS, IAS, and the Companies Act of
1994. Bonds and sukuk issued through private placements will be eligible securities in the
ATB. ATB is an automated transaction system that welcomes all types of investors.