The share price of Sinobangla Industries shot up by 30 per cent or Tk 18 to Tk 78.20 on Thursday after it announced rights issues to raise the paid-up capital.
The board of directors decided to issue one rights share against existing two shares at an issue price of Tk 20 each, including premium of Tk 10 per share.
Currently, the company's paid-up capital is Tk 199.98 million.
It will issue rights shares mainly for loan repayment and purchasing capital machinery, according to a filing with the Dhaka Stock Exchange on Thursday.
The issuance of rights share is subject to the approval of shareholders in the extraordinary general meeting scheduled for January 18, 2023 and the regulatory authorities.
The rights issue is an offer of new shares by a company to its existing shareholders in proportion to the shares they already own and usually at a discount to the market price.
The board has also recommended 10 per cent cash and 1.0 per cent stock dividend for the year ending June 30.
Earnings per share (EPS) rose to Tk 1.81 for the year ending June 30, 2022 from Tk 1.79 in the same period last year.
The sponsor-directors own 30.61 per cent stake in the company, while institutional investors own 7.20 per cent and the general public 62.19 per cent as of September 30, 2022.
Founded in 1996 as a China-Bangladesh joint venture, the company produces and exports a complete range of polypropylene woven sacks and value-added flexible intermediate bulk containers.
