educationnewsbd24blog - PROSPECTUS OF · 2019. 3. 30. · "This being the first issue of the issuer, there has been no formal market for the securities of the issuer. The face value

Prospectus

I

“প ুঁজিবািারেজবজির াগঝ ুঁ জিপরূ্ণ।জিরিওব রঝজবজির াগিরুি”

‘’Investment in capital market involves certain degree of risks. The investors are required to read the prospectus and risk factors carefully, assess their own financial conditions and risk taking ability before

making their investment decisions.’’

PROSPECTUS OF

Silco Pharmaceuticals Limited (SPL)

PUBLIC ISSUE OF 30,000,000 ORDINARY SHARESOF TK. 10.00 EACH AT PAR TOTALING TO TK. 300,000,000.00

Opening and closing date of subscription:

Opening date of subscription: March 07, 2019 Closing date of subscription: March 19, 2019

MANAGERS TO THE ISSUE:

ISSUE DATE OF THE PROSPECTUS: February 11, 2019

Prospectus

II

Preliminary Information and Declarations:

“If you have any query about this document, you may consult the issuer, issue manager and underwriter”

“A person interested to get a prospectus may obtain from the Issuer and the Issue Managers”.

NAME & ADDRESS CONTACT PERSON TELEPHONE & FAX NUMBER, E-MAIL, WEB ADDRESS

ISSUER

Silco Pharmaceuticals Limited Registered & Corporate Office: 41, Nurani, Bankalapara, Subid Bazar, Sylhet-3100, Factory: BSCIC Industrial Estate, Khadimnagor, Sylhet-3103

Dr. Md. Badrul Haque Rukan

Managing Director

Phone: +88 0821-722241, 0821-728512 Fax: Nil E-mail: [email protected] Web: www.Silcopharma.com

ISSUE MANAGERS

EBL Investments Limited 59, Motijheel C/A (1st Floor) Dhaka-1000

Tahid Ahmed Chowdhury, FCCA

Managing Director

Phone: +880-2-7118975,7119039-Ext-201,02-7118975 Fax: +880-2-7120251 Email: [email protected] Web: www.eblinvestments.com

City Bank Capital Resources Limited City Centre (Level-14), Unit ID:13D 90/1 Motijheel C/A, Dhaka-1000

Ershad Hossain Managing Director & CEO

Phone: +88 02 55110945, 55110946 Fax: +88 02 55110947 Email: [email protected] Web: www.cbcrl.com

Citizen Securities & Investment Limited House-408, Road-29, 1st Floor Mohakhali DOHS, Dhaka-1206

Md. Uzzal Hossain Managing Director & CEO

(Current Charge)

Phone: +88 02 9847988 Fax: Nil Email: [email protected] Web: www.citizensecurities.com

UNDERWRITERS

EBL Investments Ltd 59, Motijheel C/A (1st Floor), Dhaka-1000, Bangladesh


Managing Director

Phone: +880-2-7118975,7119039-Ext-201,02-7118975 Fax: +880-2-7120251 Email: [email protected] Web: www.eblinvestments.com

MTB Capital Limited MTB Tower (level-3) 111 Kazi Nazrul Islam Avenue, Bangla Motor, Dhaka-1000

Khairul basher Abu Taher Mohammed

Chief Executive Officer

Phone: +88-02-9339586,9337961 Fax: +88-02-8321760 Email: [email protected] Web: www.mtbcap.com

FAS Capital Management Ltd. Suvastu Imam Square (4th Floor) 65 Gulshan, Dhaka-1212

Shadhan Chandra Das, FCA


Phone: +02-8834251 Fax: +88-02-9860258 E-mail: [email protected] Web: www.fasbd.com



(Current Charge)


AUDITOR Ahmad & Akhtar Chartered Accountants BCIC Bhaban (3rd Floor), 30-31,Dilkusha,C/A,Dhaka-1000 A Correspondent Member Firm of Russell Bedford International, UK.

Mohammad Naser

Phone: +88 02-9561289 Fax: +88 02 -9564366 E-mail: [email protected] Web: www.aacabd.org

mailto:[email protected]

Prospectus

III

“CONSENT OF THE BANGLADESH SECURITIES AND EXCHANGE COMMISSION HAS BEEN OBTAINED TO THE ISSUE OR OFFER OF THESE SECURITIES UNDER THE SECURITIES AND EXCHANGE ORDINANCE, 1969, AND THE BANGLADESH SECURITIES AND EXCHANGE COMMISSION (PUBLIC ISSUE) RULES, 2015. IT MUST BE DISTINCTLY UNDERSTOOD THAT IN GIVING THIS CONSENT THE COMMISSION DOES NOT TAKE ANY RESPONSIBILITY FOR THE FINANCIAL SOUNDNESS OF THE ISSUER COMPANY, ANY OF ITS PROJECTS OR THE ISSUE PRICE OF ITS SECURITIES OR FOR THE CORRECTNESS OF ANY OF THE STATEMENTS MADE OR OPINION EXPRESSED WITH REGARD TO THEM. SUCH RESPONSIBILITY LIES WITH THE ISSUER, ITS DIRECTORS, CHIEF EXECUTIVE OFFICER, MANAGING DIRECTOR, CHIEF FINANCIAL OFFICER, COMPANY SECRETARY, ISSUE MANAGER, ISSUE MANAGER’S CHIEF EXECUTIVE OFFICER, UNDERWRITERS, AUDITOR(S), VALUER AND/OR CREDIT RATING COMPANY (IF ANY)."

"This being the first issue of the issuer, there has been no formal market for the securities of the issuer. The face value of the securities is tk. 10.00 (ten) and the issue price is tk. 10.00, i.e. ‘1 (One)-times’ of the face value. The issue price has been determined and justified by the issuer and the issue managers as stated under the paragraph on “justification of issue price” should not be taken to be indicative of the market price of the securities after listing. No assurance can be given regarding an active or sustained trading of the securities or the price after listing."

"Investment in securities involves a degree of risk and investors should not invest any funds in this offer unless they can afford to take the risk of losing their investment. Investors are advised to read the risk factors carefully before taking an investment decision in this offer. For taking an investment decision, investors must rely on their own examination of the issuer and the offer including the risks involved. The securities have not been recommended by the Bangladesh Securities and Exchange Commission (BSEC) nor does BSEC guarantee the accuracy or adequacy of this document. Specific attention of investors is invited to the statement of ‘risk factors’ given on page number (153 to 162)”

"The issuer, having made all reasonable inquiries, accepts responsibility for and confirms that this prospectus contains all material information with regard to the issuer and the issue, that the information contained in the prospectus are true, fair and correct in all material aspects and are not misleading in any respect, that the opinions and intentions expressed herein are honestly held and that there are no other facts, the omission of which make this document as a whole or any of such information or the expression of any such opinions or intentions misleading in any material respect."

Prospectus

IV

Availability of Prospectus

The Prospectus and abridged version prospectus in hard and soft forms of the Company shall be obtained from the following addresses:

NAME & ADDRESS CONTACT PERSON TELEPHONE & FAX NUMBER, E-MAIL, WEB ADDRESS

ISSUER

Silco Pharmaceuticals Limited Registered &Corporate Office: 41, Nurani, Bankalapara, Subid Bazar, Sylhet-3100 Factory: BSCIC Industrial Estate, Khadimnagor, Sylhet-3103

Dr. Md. Badrul Haque Rukan Managing Director

Phone: +88 0821-722241, 0821-728512 Fax: Nil E-mail: [email protected] Web: www.Silcopharma.com

ISSUE MANAGERS



Managing Director

Phone: +880-2-7118975,7119039-Ext-201 Fax: +880-2-7120251 Email: [email protected] Web: www.eblinvestments.com

City Bank Capital Resources Limited City Centre (Level-14), Unit ID:13D 90/1 Motijheel C/A, Dhaka-1000

Ershad Hossain Managing Director & CEO

Phone: +88 02 55110945, 55110946 Fax: +88 02 55110947 Email: [email protected] Web: www.cbcrl.com



(Current Charge)


UNDERWRITERS



Managing Director

Phone: +880-2-7118975,7119039-Ext-201 Fax: +880-2-7120251 Email: [email protected] Web: www.eblinvestments.com

MTB Capital Limited MTB Tower (level-3) 111 Kazi Nazrul Islam Avenue, Bangla Motor, Dhaka-1000

Khairul basher Abu Taher Mohammed


Phone: +88-02-9339586,9337961 Fax: +88-02-8321760 Email: [email protected] Web: www.mtbcap.com

FAS Capital Management Ltd. Suvastu Imam Square (4th Floor) 65 Gulshan, Dhaka-1212

Shadhan Chandra Das, FCA Chief Executive Officer

Phone: +02-8834252 Fax: +88-02-9860258 E-mail: [email protected] Web: www.fasbd.com



(Current Charge)


STOCK EXCHANGES

Dhaka Stock Exchange Limited (DSE) DSE Library, Research and Information Department 9/F, Motijheel C/A, Dhaka- 1000

Md. Afzalur Rahman Manager

Phone: +88 02 9564601-7, 9666944-8 Fax: +88 02-9569755, 9564727 Email: [email protected] Web: www.dsebd.org

Chittagong Stock Exchange Limited (CSE) CSE Building, 1080, Sheikh Mujib Road, Chittagong-4100 Dhaka Office:52-53, Dilkusha C/A, Dhaka- 1000

Md. Jabed Sarwar Assistant Manager

Phone: +88-031 714632-3, 720871 Fax: +88-031 714101, +880-2 9513911-15 E-mail: [email protected] Web: www.cse.com.bd

Prospectus would also be available on the web sites of BSEC (www.secbd.org), DSE (www.dsebd.org), CSE (www.csebd.com), Silco Pharmaceuticals Limited (SPL)(www.silcopharma.com), EBL Investments Limited (www.eblinvestments.com), City Bank Capital Resources Limited (www.cbcrl.com), Citizen Securities & Investment Limited (www.citizensecurities.com) and at the Public Reference Room of the Bangladesh Securities and Exchange Commission (BSEC) for reading and studying.

Names and dates of the newspapers where abridged version of prospectus was published:

Sl. Newspaper Name Date Page

Number

1 The Daily Samakal 11.02.2019 13

2 The Daily Bonikbarta 11.02.2019 11

3 The Daily Sharebiz 11.02.2019 09

4 The Daily New Age 11.02.2019 11

5 The Daily Independent 11.02.2019 10

http://www.secbd.org/http://www.dsebd.org/http://www.csebd.com/http://www.silcopharma.com/http://www.cbcrl.com/http://www./

Prospectus

V

Definitions and Acronyms or Elaborations

Terms : Description

A AGM : Annual General Meeting

Allotment : Letter of allotment for shares

B BAS : Bangladesh Accounting Standards

BO A/C : Beneficiary Owner Account or Depository Account

BSEC : Bangladesh Securities and Exchange Commission

BSCIC : Bangladesh Small and Cottage Industries Corporation

BFRS : Bangladesh Financial Reporting Standards

C CDBL : Central Depository Bangladesh Limited

CIB : Credit Information Bureau

Certificate : Share Certificate

CIS : Collective Investment Scheme

Commission : Bangladesh Securities and Exchange Commission

Companies Act : Companies Act, 1994 (Act. No. XVIII of 1994)

CSE : Chittagong Stock Exchange Limited

CFC Inhalers : Chlorofluorocarbons Inhalers

CGMP : Current Good Manufacturing Practice

D DAR : (Data/Action/Response) method is the format utilized for

documentation of problems identified in the patient care plan (problem oriented charting format)

DSE : Dhaka Stock Exchange Limited

DTM&H : Diploma in Tropical Medicine and Hygiene

DLO : Diploma in Laryngology and Otology

E EHS : Environmental Health and Safety

EI : Eligible Investors

EURO : Official currency of the European Union

EPS : Earning Per Share

EMS : Express Mail Service

F FC Account : Foreign Currency Account

FCPS : Fellow of College of Physicians and Surgeons

G GBP : Great Britain Pound

GP : General Public

H HFA Inhalers : Hydrofluoroalkane Inhalers

I IPO : Initial Public Offering

Issue : Public Issue of shares of Silco Pharmaceuticals Limited

Issuer : Silco Pharmaceuticals Limited

Issue Managers : Citizen Securities & Investment Limited (CSIL) and City Bank Capital Resources Limited (CBCRL)

Prospectus

VI

EBL Investments Limited

IV Infusions : Intravenous Infusions

M MP : Market Price

MBBS : Bachelor of Medicine and Bachelor of Surgery

MRSH : Member of the Royal Society for the Promotion of Health (UK)

MS : Master of Surgery

MCPS : Member of College of Physicians and Surgeons

MRCP : Membership of the Royal Colleges of Physicians

N NAV : Net Asset Value of the Company

NRB : Non-Resident Bangladeshi

NBR : National Board of Revenue

O OBST : Obstetrician

R RJSC : Registrar of Joint Stock Companies and Firms

S SPL/SILCO : Silco Pharmaceuticals Limited

Securities Market : Share market

Securities : Shares of Silco Pharmaceuticals Limited

Sponsors : The Sponsors Shareholders of Silco Pharmaceuticals Limited

STD Account : Short Term Deposit Account

Stockholders : Shareholder

SC : Share Certificate

Subscription : Application money

T Taka/Tk./BDT : Bangladeshi Taka

The Company : Silco Pharmaceuticals Limited

TIN : Tax Identification Number

U USD : United States Dollar

V VAT : Value Added Tax

W WPPF : Workers’ Profit Participation Fund

WDV : Written Down Value

Prospectus

VII

Table of Contents SECTION (I): EXECUTIVE SUMMARY ..................................................................................................................................... 1

a) About the industry: ................................................................................................................. 1

b) About the Issuer: .................................................................................................................... 2

c) Financial Information: ............................................................................................................. 3

d) Features of the issue and its objects: ..................................................................................... 3

e) Legal and other Information: .................................................................................................. 3

f) Promoters’ background: ......................................................................................................... 5

g) Capital structure and history of capital raising: ...................................................................... 6

h) Summary of Valuation Report of securities:........................................................................... 7

i) Others: .................................................................................................................................... 7

SECTION (II): CONDITIONS IMPOSED BY THE COMMISSION IN THE CONSENT LETTER ....................................................... 9

CONDITIONS UNDER 2CC OF THE SECURITIES AND EXCHANGE ORDINANCE, 1969 .......................... 9

SECTION (III): DECLARATION AND DUE DILIGENCE CERTIFICATES ..................................................................................... 17

DECLARATION ABOUT THE RESPONSIBILITY OF THE DIRECTOR(S), INCLUDING THE CEO OF “SILCO

PHARMACEUTICALS LIMITED (SPL)” IN RESPECT OF THE PROSPECTUS ............................... 17

DUE DILIGENCE CERTIFICATE BY ISSUE MANAGER ........................................................................... 18



DUE DILIGENCE CERTIFICATE BY THE UNDERWRITER(S) .................................................................. 24




SECTION (IV): ABOUT THE ISSUER ...................................................................................................................................... 31

Particulars of the Company............................................................................................................... 31

Names of the Sponsors and Directors .............................................................................................. 31

Names of the Directors ..................................................................................................................... 32

Particulars of Auditor and Registrar to the Issue .............................................................................. 32

Name of the Stock Exchanges where the Securities to be listed: ..................................................... 32

SECTION (V): CORPORATE DIRECTORY OF THE ISSUER ...................................................................................................... 33

SECTION (VI): DESCRIPTION OF THE ISSUER ...................................................................................................................... 34

a. Summary ............................................................................................................................... 34

b. General Information: ............................................................................................................ 35

c. Capital Structure: .................................................................................................................. 40

d. Description of Business: ....................................................................................................... 46

Prospectus

VIII

e. Description of Property: ....................................................................................................... 61

f. Plan of Operation and Discussion of Financial Condition: .................................................... 85

SECTION (VII): MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULT OF OPERATIONS99

a) Overview of business and strategies: ................................................................................... 99

b) SWOT ANALYSIS: ................................................................................................................... 99

c) Analysis of the financial statement of last five years: ........................................................ 101

d) Known trends, demands, commitments, events or uncertainties that are likely to have an

effect on the company’s business: ..................................................................................... 102

e) Trends or expected fluctuations in liquidity: ...................................................................... 102

f) Off-balance sheet agreements those have or likely to have a current or future effect on

financial condition: ............................................................................................................. 102

SECTION (VIII): DIRECTORS AND OFFICERS ...................................................................................................................... 103

a) Name, Father’s Name, age, Residential address, Educational qualification, experience and

position of each of the directors and any person nominated/represented to be a director,

showing the period for which the nomination has been made and the name of the

organization which has nominated him: ............................................................................ 103

b) Date of first Directorship and Expiry of Current Tenure of the directors: ......................... 104

c) Name of Interest and Involvement in other business/organization of directors: .............. 104

d) Statement of if any Directors of the issuer are associated with the securities market in any

manner and any director of the issuer company is also director of any issuer of other listed

securities during last three years with dividend payment history and market performance:

............................................................................................................................................ 104

e) Family relationship (father, mother, spouse, brother, sister, son, daughter, spouse’s father,

spouse’s mother, spouse’s brother, spouse’s sister) among the directors and top five

officers: ............................................................................................................................... 105

f) Brief description of other businesses of the directors: ...................................................... 105

g) Short bio-data of each director .......................................................................................... 106

h) Loan status of the issuer, its directors and shareholders who hold 10% or more shares in the

paid-up capital of the issuer in terms of the CIB Report of Bangladesh Bank:................... 108

i) Name, position, educational qualification, age, date of joining in the company, overall

experience (in year), previous employment, salary paid for the financial year of the CEO,

MD, CFO, CS, Advisers, Consultants and all Departmental Heads. If the Chairman, any

director or any shareholder received any monthly salary than this information should also

be included: ........................................................................................................................ 108

j) Changes in the key management persons during the last three years: ............................. 109

k) A profile of the sponsors including their names, father’s names, age, personal addresses,

educational qualifications, and experiences in the business, positions/posts held in the past,

directorship held, other ventures of each sponsor and present position: ......................... 109

Prospectus

IX

l) If the present directors are not the sponsors and control of the issuer was acquired within

five years immediately preceding the date of filing prospectus details regarding the

acquisition of control, date of acquisition, terms of acquisition, consideration paid for such

acquisition etc. .................................................................................................................... 110

m) If the sponsors/directors do not have experience in the proposed line of business, the fact

explaining how the proposed activities would be carried out/managed: ......................... 111

n) Interest of the key management persons: ......................................................................... 111

o) All interests and facilities enjoyed by a director, whether pecuniary or non-pecuniary: .. 111

p) Number of shares held and percentage of shareholding of Sponsors and Directors(pre issue):

............................................................................................................................................ 112

q) Change in board of directors during last three years: ........................................................ 112

r) Director’s engagement with similar business: ................................................................... 112

SECTION (IX): CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS ......................................................................... 113

a) Description of any transaction during the last five years, or any proposed transactions

certified by the auditors, between the issuer and any of the following persons, giving the

name of the persons involved in the transaction, their relationship with the issuer, the

nature of their interest in the transaction and the amount of such interest ..................... 113

b) Transaction or arrangement entered into by the issuer or its subsidiary or associate or entity

owned or significantly influenced by a person who is currently a director or in any way

connected with a director of either the issuer company or any of its subsidiaries/holding

company or associate concerns, or who was a director or connected in any way with a

director at any time during the last three years prior to the issuance of the prospectus . 114

c) loans either taken or given from or to any director or any person connected with the

director, clearly specifying details of such loan in the prospectus, and if any loan has been

taken from any such person who did not have any stake in the issuer, its holding company

or its associate concerns prior to such loan, rate of interest applicable, date of loan taken,

date of maturity of loan. and present outstanding of such loan ....................................... 114

SECTION (X): EXECUTIVE COMPENSATION ...................................................................................................................... 115

a) The total amount of remuneration/salary/perquisites paid to the top five salaried officers

of the issuer in the last accounting year and the name and designation of each such officer:

............................................................................................................................................ 115

b) Aggregate amount of remuneration paid to all directors and officers as a group during the

last accounting year: ........................................................................................................... 115

c) If any shareholder director received any monthly salary/perquisite/benefit it must be

mentioned along with date of approval in AGM/EGM, terms thereof and payments made

during the last accounting year: ......................................................................................... 115

d) The board meeting attendance fees received by the director including the managing director

along with date of approval in AGM/EGM: ........................................................................ 115

e) Any contract with any director or officer providing for the payment of future compensation:

............................................................................................................................................ 115

Prospectus

X

f) If the issuer intends to substantially increase the remuneration paid to its directors and

officers in the current year, appropriate information regarding thereto: ......................... 115

g) Any other benefit/facility provided to the above persons during the last accounting year:

............................................................................................................................................ 115

SECTION (XI): OPTIONS GRANTED TO DIRECTORS, OFFICERS AND EMPLOYEES ............................................................. 116

SECTION (XII): TRANSACTION WITH THE DIRECTORS AND SUBSCRIBERS TO THE MEMORANDUM ............................... 116

a) Benefits received by the issuer during the last five years along with the description of assets,

services or other consideration received or to be received; .............................................. 116

b) Assets were acquired or to be acquired from the Directors and Subscribers of the

Memorandum: .................................................................................................................... 116

SECTION (XIII): OWNERSHIP OF THE COMPANY’S SECURITIES ........................................................................................ 117

a) The names, Addresses, BO ID Number of all shareholders of the Company before IPO,

indicating the amount of securities owned and the percentage of the securities represented

by such ownership: ............................................................................................................. 117

b) There shall also be a table showing the name and address, age, experience, BO ID Number,

TIN number, numbers of shares held including percentage, position held in other companies

of all the directors before the public issue: ........................................................................ 127

c) The average cost of acquisition of equity shares by the directors certified by the auditors:

............................................................................................................................................ 129

d) A detail description of capital built up in respect of shareholding (name-wise) of the issuer’s

sponsors/ directors. In this connection, a statement to be included: ............................... 130

e) Detail of shares issued by the company at a price lower than the issue price: ................. 133

f) History of significant (5% or more) changes in ownership of securities from inception: .. 133

SECTION (XIV): CORPORATE GOVERNANCE ..................................................................................................................... 134

a) Management disclosure regarding compliance with the requirements of Corporate

Governance Guidelines of the Bangladesh Securities and Exchange Commission (BSEC); 134

b) A compliance report of Corporate Governance requirements certified by competent

authority; ............................................................................................................................ 134

c) Details relating to the issuer's audit committee and remuneration committee, including the

names of committee members and a summary of the terms of reference under which the

committees operate. .......................................................................................................... 141

SECTION (XV): VALUATION REPORT OF SECURITIES PREPARED BY THE ISSUE MANAGER .............................................. 142

SECTION (XVI): DEBT SECURITIES ..................................................................................................................................... 145

SECTION (XVII): PARTIES INVOLVED AND THEIR RESPONSIBILITIES ................................................................................. 145

SECTION (XVIII): MATERIAL CONTRACTS ......................................................................................................................... 146

SECTION (XIX): OUTSTANDING LITIGATIONS, FINE OR PENALTY ..................................................................................... 149

SECTION (XX): RISK FACTORS AND MANAGEMENT’S PERCEPTIONS ABOUT THE RISKS.................................................. 150

i. Internal risk factors may include, among others: ............................................................... 150

Prospectus

XI

ii. External risk factors may include among others: ............................................................... 155

iii. Other risks factors may include: ......................................................................................... 158

SECTION (XXI): DESCRIPTION OF THE ISSUE..................................................................................................................... 160

SECTION (XXII): USE OF PROCEEDS .................................................................................................................................. 165

a) Use of net proceeds of the offer indicting the amount to be used for each purpose with

head-wise break-up ............................................................................................................ 165

b) Utilization of the total amount of paid-up capital and share premium, if any, including the

sponsors’ contribution and capital raised of the issuer at the time of submission of

prospectus, in details with indication of use of such funds in the financial statements; .. 210

c) If one of the objects is an investment in a joint venture, a subsidiary, an associate or any

acquisition, details of the form of investment, nature of benefit expected to accrue to the

issuer as a result of the investment, brief description of business and financials of such

venture: .............................................................................................................................. 211

d) If IPO proceeds are not sufficient to complete the project, then source of additional fund

must be mentioned. In this connection, copies of contract to meet the additional funds are

required to be submitted to the Commission. The means and source of financing, including

details of bridge loan or other financial arrangement, which may be repaid from the

proceeds of the issue along with utilization of such funds: ............................................... 211

e) A schedule mentioning the stages of implementation and utilization of funds received

through public offer in a tabular form, progress made so far, giving details of land

acquisition, civil works, installation of plant and machinery, the approximate date of

completion of the project and the projected date of full commercial operation etc. The

schedule shall be signed by the Chief Executive Officer or Managing Director, Chief Financial

Officer and Chairman on behalf of Board of Directors of the issuer: ................................. 211

f) If there are contracts covering any of the activities of the issuer for which the proceeds of

sale of securities are to be used, such as contracts for the purchase of land or contracts for

the construction of buildings, the issuer shall disclose the terms of such contracts, and

copies of the contracts shall be enclosed as annexure to the prospectus: ........................ 212

g) If one of the objects of the issue is utilization of the issue proceeds for working capital, basis

of estimation of working capital requirement along with the relevant assumptions, reasons

for raising additional working capital substantiating the same with relevant facts and figures

and also the reasons for financing short with long term investments and an item wise break-

up of last three years working capital and next two years projection: .............................. 212

h) Where the issuer proposes to undertake one or more activities like diversification,

modernization, expansion, etc., the total project cost activity-wise or project wise, as the

case may be: ....................................................................................................................... 212

i) Where the issuer is implementing the project in a phased manner, the cost of each phase,

including the phases, if any, which have already been implemented: .............................. 212

j) The details of all existing or anticipated material transactions in relation to utilization of the

issue proceeds or project cost with sponsors, directors, key management personnel,

associates and group companies: ....................................................................................... 212

Prospectus

XII

k) Summary of the project appraisal/ feasibility report by the relevant professional people with

cost of the project and means of finance, weaknesses and threats, if any, as given in the

appraisal/ feasibility report: ............................................................................................... 213

SECTION (XXIII): LOCK-IN .................................................................................................................................................. 223

SECTION (XXIV): MARKETS FOR THE SECURITIES BEING OFFERED .................................................................................. 231

SECTION (XXV): DESCRIPTION OF SECURITIES OUTSTANDING OR BEING OFFERED ........................................................ 232

a) Dividend, voting and preemption rights; ............................................................................ 232

b) Conversion and liquidation rights; ...................................................................................... 232

c) Dividend policy; .................................................................................................................. 232

d) Other rights of the securities holders; ................................................................................ 233

SECTION (XXVI): FINANCIAL STATEMENTS ....................................................................................................................... 234

a) The latest financial statements prepared and audited by the Commission’s panel auditors in

adherence to the provisions of the Securities and Exchange Rules, 1987, theক োম্পোনি আইি, ১৯৯৪, International financial Reporting and Auditing Standards as adopted in Bangladesh from time to time and any other law as applicable; .......................................................... 234

b) Information as is required under section 186 of the ক োম্পোনিআইি, ১৯৯৪,relating to holding company; ............................................................................................................................ 260

c) Selected ratios as specified in Annexure-D; ....................................................................... 260

d) Auditors report under Section 135(1), Paragraph 24(1) of Part II of Schedule III of the

ক োম্পোনিআইি, ১৯৯৪. The report shall include comparative income statements and balance sheet and aforementioned ratios for immediate preceding five accounting years of the

issuer. If the issuer has been in commercial operation for less than five years, the above

mentioned inclusion and submission will have to be made for the period since commercial

operation; ........................................................................................................................... 267

e) Financial spread sheet analysis for the latest audited financial statements;..................... 269

f) Earnings Per Share (EPS) on fully diluted basis (with the total existing number of shares) in

addition to the weighted average number of shares basis. Future projected Net Income

should not be considered while calculating the weighted average EPS; ........................... 271

g) All exdtra-ordinary income or non-reccuring income coming from other than core

operations should be shown separatly whole showing the Net Profit as well as the Earning

Per Share;............................................................................................................................ 271

h) Quarterly or half-yearly EPS should not be annualized while calculating the EPS: ............ 271

i) Net asset value (with and without cosidering revaluation surplus/reserve) per unit of the

securities being offered at the date of the latest audited statement of fianancial position

............................................................................................................................................ 271

j) Re-audit the Audited Financial Statement ......................................................................... 271

k) Following statements for the last five years or any shorter period of commercial operation

certified by the auditors: .................................................................................................... 272

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XIII

i. Certificate on long term and short term borrowings including borrowing from related party or connected persons with rate of interest and interest paid/accrued of ‘Silco Pharmaceuticals Limited’ period from 01 January 2012 to 30 June 2017 ......................... 272

ii. Certificate on Statement of Principal Terms of Secured Loans and Assets on which charge have been created against those loans of ‘Silco Pharmaceuticals Limited’ period from 01 January 2012 to 30 June 2017 ............................................................................................ 274

iii. Certificate on unsecured loans with terms & conditions of ‘Silco Pharmaceuticals Limited’ period from 01 January 2012 to 30 June 2017 ................................................................... 276

iv. Certificate on inventories showing amount of raw material, packing material, stock-in-process and finished goods, consumable items, store & spares parts, inventory of trading goods etc. of ‘Silco Pharmaceuticals Limited’ period from 01 January 2012 to 30June 2017. ............................................................................................................................................ 276

v. Certificate on trade receivables showing receivable from related party and connected persons of ‘Silco Pharmaceuticals Limited’ period from 01 January 2012 to 30 June 2017 ............................................................................................................................................ 277

vi. Certificate on any loan given by the issuer including loans to related party or connected persons with rate of interest and interest realized/accrued of ‘Silco Pharmaceuticals Limited’ period from 01 January 2012 to 30 June 2017 ................................................................... 277

vii. Certificate on other income showing interest income, dividend income, discount received and other non-operating income of ‘Silco Pharmaceuticals Limited’ period from 01 January 2012 to 30 June 2017 ......................................................................................................... 278

viii. Certificate on turnover showing separately in cash and through banking channel of ‘Silco Pharmaceuticals Limited’ period from 01 January 2012 to 30 June 2017 ......................... 278

ix. Certificate on related party transaction of ‘Silco Pharmaceuticals Limited’ period from 01 January 2012 to 30 June 2017 ............................................................................................ 279

x. Certificate on Reconciliation of business income shown in tax return with net income shown in audited financial statements of ‘Silco Pharmaceuticals Limited’ period from 01 January 2012 to 30 June 2017 ......................................................................................................... 280

xi. Certificate on Confirmation that all receipts and payments of the issuer above Tk. 500,000/- were made through banking channel of ‘Silco Pharmaceuticals Limited’ period from 01 January 2012 to 30 June 2017 ............................................................................................ 280

xii. Certificate on Confirmation that Bank Statements of the issuer are in conformity with its books of accounts of ‘Silco Pharmaceuticals Limited’ period from 01 January 2012 to 30 June 2017 .................................................................................................................................... 280

xiii. Certificate on Statement of payment status of TAX, VAT and other taxes/duties of ‘Silco Pharmaceuticals Limited’ period from 01 January 2012 to 30 June 2017 ......................... 281

SECTION (XXVII): PUBLIC ISSUE APPLICATION PROCEDURE............................................................................................. 379

SECTION (XXVIII): OTHERS ................................................................................................................................................ 384

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SECTION (I): EXECUTIVE SUMMARY

a) About the industry:

The pharmaceutical industry in Bangladesh is one of the most developed technology sectors within Bangladesh. Manufacturers produce insulin, hormones, and cancer drugs. Presently, the pharma industry of Bangladesh meets 98 percent of the local demand and exports to more than 150 countries. Bangladesh's pharmaceutical sector can grow at 15 percent for the next five years riding on the expanded domestic market as well as new export frontiers, according to a new research.

Source: EPB

Since the beginning of the decade, the pharmaceutical industry in Bangladesh has experienced double-digit growth driven by large consumer base, improved health consciousness and a supportive regulatory framework. Two effective policies have accelerated the growth of the sector. One was the Drug Control Ordinance 1982, which banned foreign companies from selling imported pharmaceutical products in the country. The other was the relaxation of the World Trade Organization’s agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS), which permitted Bangladesh to reverse engineer patented generic drugs. The relaxation of TRIPS for least-developed countries has been extended to 2033. Now, Bangladesh proudly stands alone as the only LDC that has a well-developed pharma sector.

36.2 4144.3 48.3

59.872.6

81.290.3

FY 2010 FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017

Pharma Exports in Millions of $

Pharma Exports in Millions of $

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− Bangladesh earned $43 million from exporting pharmaceutical goods in the first five month of

the 2017-18 fiscal year

− Emerging generic drug hub in the region

− Nearly self-sufficient; 98% demand met by local production

− Total market size approx. US $2 billion since 1982, which is around 1% of GDP

− Historically good growth maintained (c.>10-15% last few years)

− Strong manufacturing base; skilled manpower

− Largest white collar labor intensive employment sector

− 2nd highest contributor to national exchequer

− Registered pharmaceutical companies: 245; functional 220

− All the top 10 companies are local and they have approx. 70% market share

− MNCs such as Radiant, Sanofi and Novo Nordisk enjoy a 10.5% market share

− Leading companies have major approvals (US FDA, EU GMP, UK MHRA, TGA Australia, ANVISA

Brazil etc.)

− the government has started the process of constructing an active pharmaceutical ingredient

industrial park in Munshiganj

Bangladesh Pharma has high capability in Specialized Pharmaceuticals The industry continues its strong research orientation in generic formulation development and has already proven its skills with successful development of specialized, high-tech formulations which are very difficult to imitate. Leading companies have focused on specialized dosage delivery systems to create strong differentiation and successfully developed metered dose inhaler (MDI), dry powder inhaler (DPI), lyophilized injectables, sterile ophthalmics, prefilled syringes, oral thin films, multi-layer tablets, biological products, including insulin, vaccines etc.

(Data Source: http://www.bapi-bd.com/bangladesh-pharma-industry/overview#)

b) About the Issuer:

Incorporation As Public Limited Company

25 January, 1995 Registration no. C-27781(1627)/95

Commencement of Commercial Operation

According to the certificate of Commencement the date of commercial operation is 25 January, 1995, but the Company received the drug manufacturing license on 29 October, 2003 and the commercial operation has started on 30 October, 2003

Denomination of Share Price from BDT 1,000 to BDT 10 per share

20 November, 2012

Factory Location BSCIC Industrial Estate, Khadimnagor, Sylhet-3103, Bangladesh

Head Office 41, Nurani, Bankalapara, Subid Bazar, Sylhet-3100, Bangladesh

Nature of Business The principal activities of the Company are to manufacturing, selling and distributing pharmaceutical products throughout Bangladesh

http://www.bapi-bd.com/bangladesh-pharma-industry/overview

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c) Financial Information:

Sl. Particulars Year Ended 30-June-17

Year Ended 30-June-16 (6 month)

Year Ended 31-Dec-15

Year Ended 31-Dec-14 (Re-stated)



1 Sales Revenue 906,528,993 438,643,061 851,159,177 810,144,679 997,984,022 839,888,056

2 Gross Profit 290,918,804 156,054,907 309,293,054 216,166,601 389,458,285 361,355,947

3 Net profit before tax

158,351,004 91,996,678 180,114,491 93,038,732 264,673,814 245,191,183

4 Net Profit after tax 102,928,153 59,797,841 117,074,419 60,475,177 140,884,897 126,954,589

5 Total Assets 1,990,153,525 1,837,353,837 1,763,194,426 1,658,786,812 1,575,355,908 1,383,204,412

6 Share Capital 643,700,000 643,700,000 643,700,000 43,700,000 43,700,000 43,700,000

7 Retained Earnings 992,012,653 889,084,502 829,286.660 712,212,241 637,727,973 390,762,145

8 No. of Shares 64,370,000 64,370,000 64,370,000 4,370,000 4,370,000 4,370,000

9 Face Value 10.00 10.00 10.00 10.00 10.00 10.00

10 NAV Per Share 25.41 23.81 22.88 172.98 155.93 99.42

11 EPS (Diluted) 1.60 0.93 1.82 0.94 2.19 1.97

d) Features of the issue and its objects:

Offer Price BDT 10.00

Number of Shares 30,000,000 Ordinary Shares

Offer Size BDT 300,000,000.00

Issue Manager EBL Investments Limited City Bank Capital Resources Limited Citizen Securities & Investment Limited

Register to the Issue N/A

Underwriter(s)

EBL Investments Ltd

MTB Capital Limited

FAS Capital Management Ltd.

Citizen Securities & Investment Limited

NAV per Share BDT 25.41

EPS per Share BDT 1.60

Purpose of Raising Fund

Proceeds from initial public offering (IPO) will be used for Civil construction, purchase of machineries and purchase of Delivery van & other vehicles.

Date of Implementation

Within 18 months after receiving IPO fund

e) Legal and other Information:

Name of the Company Silco Pharmaceuticals Limited

Legal Status Public Limited Company

Date of Incorporation 25 January, 1995

Date of Commencement of Business 25 January, 1995

Registration Number C-27781(1627)/95

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Certificate/License Name Issuing Authority Certificate

/License No Validity

Trade License Sylhet City Corporation 1582 Valid till 30.06.2019

Factory Trade License Khadimpara Union

Council 295 Valid till 30.06.2019

Tin Certificate National Board of

Revenue, Govt. of Bangladesh

325025208929 N/A

VAT certificate

Commissioner of Customs, Excise and

VAT, Govt. of Bangladesh

22011005258 Area Code:

220101 N/A

Certificate of Incorporation Registrar of Joint Stock Companies and Firms, Govt. of Bangladesh

C-27781(1627)/95

N/A

Certificate for Commencement of Business

Registrar of Joint Stock Companies Bangladesh

9036 N/A

Environmental Clearance Certificate

Department of Environment, Sylhet

285 Valid till 22.07.2019

Drugs Import Registration certificate

Controller of Imports & Exports, Govt. of

Bangladesh B-116725 Valid till 30.06.2019

Fire License Bangladesh Fire Service

& Civil Defense

Sylhet - 2/1264/2002-

2003 Valid till 30.06.2019

Certificate of Renewal of License to Manufacture Drugs

Directorate General of Drug Administration &

Licensing Authority (Drugs)

License No.: 450 License No.: 217

Valid till 13.08.2019

Membership certificate of The Sylhet Chamber of Commerce & Industry

The Sylhet Chamber of Commerce & Industry

Membership no. O-1081


Narcotics Production and Processing License

Department of Narcotics Control,

Sylhet 01/03-04 Valid till 30.06.2019

Factory License Department of Factory,

Sylhet 929/Sylhet Valid till 30.06.2019

Certificate of Good Manufacturing Practice (GMP) for Pharmaceutical Products

Directorate General of Drug Administration &

Licensing Authority (Drugs)

DA/6-173/2013/24263


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f) Promoters’ background: Mrs. Naim Fatema Mrs. Naim Fatema is the Chairman of Silco Pharmaceuticals Ltd. She was born in a respectable Muslim family at Sylhet in 1954. Mrs. Fatema completed her BA (Hons) and MA in Sociology and started her professional career in the field of teaching profession and now she is the Head Mistress of M.C College Shisu Biddaloy, Sylhet. Mrs. Fatema is also a Director of North East Medical College. She visited many countries including UK, USA, India, Thailand, Malaysia etc. on business and personal tour.

Dr. Md. Badrul Haque Rukan Dr. Md. Badrul Haque Rukan, aged 64, is a Director of the company since inception. He is currently employed as a Managing Director of the company. Mr. Rukan is a prominent Child Specialist in Sylhet city; completed his MBBS, DCH from DUB, also achieved MRSC degree from London. After obtaining his MBBS Degree he engages himself in his in own profession and simultaneously engages in relevant business sector and serving efficiently in medical, Pharmaceuticals industry and profession for more than 35 years. He has long experience involving in Pharmaceuticals industry with particular experience in product development and marketing. Dr. Rukan is also involved with many social organizations and visited many countries including UK, USA, India, Bangkok, Malaysia, Singapore etc. on business and personal purpose. He is also the director of Park View Medical College and National Diagnostic Centre situated in Sylhet.

Dr. Azizur Rahman Dr. Azizur Rahman is a Director Silco Pharmaceuticals Ltd. and has long experience working with pharmaceuticals Industry. He is a professor of Child Health of North East Medical College & Hospital. Dr. Rahman is also a sitting Chairman and Director of Al-Amin Dental College, Sylhet. During his career as a medical professional he has awarded many degrees in Bangladesh and overseas. He completed his MBBS and DTM & H from Dhaka Medical and achieved MRSH degree from London, UK.

Prof. Dr. Md. Harunur Rashid Prof. Dr. Md. Harunur Rashid is one of the renowned and famous ENT specialists in Bangladesh, born in 1955. He has completed MBBS and DLO from Dhaka Medical. He is involved in Silco Pharmaceuticals Ltd. since inception of the Company and advising in product & market development. He is a former Vice Principal and head of the ENT department of Sylhet MAG Osmani Medical College, Sylhet. Prof. Dr. Md. Harunur Rashid visited many countries including UK, USA, Japan, China, India, Thailand, Malaysia and many others.

Dr. Mahmudul Majid Chowdhury Dr. Mahmudul Majid Chowdhury is a Medicine Specialist trained from overseas countries. He has completed his MBBS and DIM in Internal Medicine from Bangladesh and subsequently trained from Royal Post Graduate Medical College. Dr. Chowdhury also received Specialist Training in Medicine from London Hammersmith Hospital, UK. He has vast experience and knowledge about Internal Medicine. He also worked as a Medicine specialist in Sylhet MAG Osmani Medical College Hospital, Sylhet.

Dr. Mohammed Afzal Dr. Mohammad Afzal is a renowned medicine specialist in Sylhet. He was born in 01 April 1949 in Sylhet. He has completed his MBBS and FCPS in Medicine. He has vast experience and knowledge about Medicine and one of the most popular Medicine Specialist in Sylhet.

Dr. Md. Abdus Sabur Dr. Md. Abdus Sabur is a renowned Obstetrics and Gynecology specialist in Sylhet. He was born in 15 October 1954 in Sylhet. He has completed his MBBS and FCPS. He is also a WHO fellow. Dr. Md. Abdus

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Sabur has vast experience and knowledge about Obstetrics and Gynecology and one of the most popular Gynecologist in Sylhet.

Dr. A.Z.M Monzurul Haque Chow. Dr. A.Z.M Monzurul Haque Chowdhury is a renowned consultant in Sylhet. He was born in 01 November 1956 in a well reputed family. He has completed his MBBS from Bangladesh later he went to USA and completed his MS degree. He has vast experience and knowledge of practicing about 30 years in local and abroad.

Dr. Md. Zakaria Dr. Md. Zakaria is a renowned Dermatologist in Sylhet. He was born in 01 July 1955 in the Jharnarpar village of Sylhet district. He has completed his MBBS from Bangladesh later he became a member of the College of Physicians and Surgeons. Dr. Md. Zakaria has also completed his Diploma in Dermatology & Venereology. He has vast experience and knowledge about Medicine.

Dr. S.M. Abul Lais Dr. S.M. Abul Lais is a renowned physicist in Sylhet. He was born in 30December 1940 in a well reputed family of Sylhet. He has completed his MBBS and MRCP from UK. Dr. S.M. Abul Lais has vast experience and knowledge about practicing both in UK and Bangladesh.

Mrs. Nargis Akhter Mrs. Nargis Akhter is a Housewife. She was born in 11 September 1979 in Sylhet district in a respected Muslim family. She is one of the sponsors of Silco Pharmaceuticals Limited.

Dr. A.T.M.A. Jalil Dr. A.T.M.A. Jalil is a renowned Cardiologist in Sylhet. He was born in 20February 1955. He has completed his MBBS and FCPS in Medicine and Cardiology. He has vast experience and knowledge about Medicine and Cardiovascular Disease.

g) Capital structure and history of capital raising:

Capital structure of the Company

Particulars No. of shares Nominal

Price Issue Price

Amount (BDT)

Before IPO

Authorized Capital 105,000,000 10 10 1,050,000,000.00

Issue, Subscribed & Paid up Capital 64,370,000 10 10 643,700,000.00

Total Paid up Capital before IPO (A) 64,370,000 10 10 643,700,000.00

After IPO

To be Issued through IPO (B) 30,000,000 10 10 300,000,000.00

Paid up Capital (post IPO) (A+B) 94,370,000 10 10 943,700,000.00

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History of Capital Raising

Particulars

No.of Share issued Amount of share capital

(Taka) Consideration

in cash Consideration

other than cash

January 25, 1995 (At the time of Incorporation)

1,200,000.00 - 1,200,000.00

November 20, 2012 (Second Allotment) 42,500,000.00 - 42,500,000.00

March 18, 2015 (Third Allotment) 600,000,000.00 - 600,000,000.00

Total 643,700,000.00 - 643,700,000.00

h) Summary of Valuation Report of securities:

Method Particulars Amount in Taka

Method-1 Net Asset Value(NAV) per share 25.41

Method-2 Historical Earning based value per share based on overall Market P/E

24.32

Method -3 Average market price per share of similar stocks 429.40

i) Others:

(i) Declaration by the Issuer regarding any material changes We, the Issuer, declare that we did not make any material changes including raising of paid-up capital after the date of audited financial statements as included in the prospectus.

Sd/- Dr. Md. Badrul Haque Rukon Managing Director Silco Pharmaceuticals Limited

(ii) Declaration by the Issue Manager regarding connection with the Issuer

We, the Issue Manager of the forthcoming IPO of Silco Pharmaceuticals Limited hereby declare that, we or any of our connected person is in no way connected with the Issuer or any of its connected person nor does hold any securities thereof.

Sd/- Tahid Ahmed Chowdhury, FCCA

Managing Director EBL Investments Limited

Sd/- Ershad Hossain

Managing Director & CEO City Bank Capital Resources Limited

Sd/-

Md. Uzzal Hossain Managing Director & CEO (Current Charge)

Citizen Securities & Investment Limited

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(iii) Description of leased land on which factory building is situated

Name of Lessor Bangladesh Small and Cottage Industries Corporation (BSCIC)

Date of signing lease deed 30.12.1998 and 31.08.2003 respectively

Area & location of leased land

Total Area: 45,000 sqft. Location: BSCIC Industrial Estate, Khadimnagor, Sylhet-3103, Bangladesh

Tenure of lease 99 years effective from 30.12.1998

Ownership of leased land

Bangladesh Small and Cottage Industries Corporation (BSCIC) has the sole ownership of this land, Silco Pharmaceuticals Limited took this land for 99 years operating lease

Nature of lease Operating Lease

Termination clauses of lease

According to Article 4, the Lessee shall commence manufacturing operation on the land within two years from the date of the commencement of the lease, failing which the lease will be Liable to be terminated but the Lessor may for just and sufficient reasons, extend the period.

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SECTION (II): CONDITIONS IMPOSED BY THE COMMISSION IN THE CONSENT LETTER

DISCLOSURE IN RESPECT OF ISSUANCE OF SECURITY IN DEMAT FORM

As per provisions of the Depository Act, 1999 and regulations made there under, share of the Company will be issued in dematerialized form only and for this purpose Silco Pharmaceuticals Limited will sign an agreement with the Central Depository Bangladesh Limited (CDBL). Therefore, all transfers, transmissions, splitting or conversions will take place on the CDBL system and any further issuance of shares (including rights and bonus) will also be issued in dematerialized form only.

CONDITIONS UNDER 2CC OF THE SECURITIES AND EXCHANGE ORDINANCE, 1969

PART–A

1. The company shall go for Initial Public Offer (IPO) for 30,000,000 Ordinary Shares of Tk. 10.00 each at par totaling Tk. 300,000,000.00 (Taka Thirty Crore only) following the Securities and Exchange Ordinance, 1969, the Bangladesh Securities and Exchange Commission (Public Issue) Rules, 2015, the Depository Act, 1999 and rules made there under.

2. The abridged version of the prospectus, as approved by the Commission, shall be published by the

issuer in 4 (Four) national daily newspapers (two in Bangla and two in English), within 02 (two) working days of issuance of this consent letter. The issuer shall post the full prospectus, vetted by Commission, in the issuer’s website and shall also put on the websites of the Commission, stock exchanges, and the issue manager, within 3 (three) working days from the date of issuance of this letter and shall remain posted till the closure of the subscription list. The issuer shall submit to the Commission, the stock exchanges and the issue manager a diskette containing the text of the vetted prospectus in “MS -Word” format.

3. The company shall submit 40 (Forty) copies of the printed prospectus to the Bangladesh Securities

and Exchange Commission for official record within 05 (Five) working days from the date of publication of the abridged version of the prospectus in the newspaper.

4. The issuer company and the issue manager shall ensure transmission of the prospectus and its abridged version for NRBs through email to the Bangladesh Embassies and Missions abroad within 5 (Five) working days from the date of publication of the abridged version of the prospectus in the newspaper. A compliance report shall be submitted in this respect to the Commission jointly by the issuer and the Issue Manager within 02 (Two) working days from the date of said transmission of the prospectus.

5. The following declaration shall be made by the company in the prospectus, namely: -

“Declaration about Listing of Shares with the stock exchange (s):

None of the stock exchange(s), if for any reason, grants listing within 75 (Seventy Five) days from the closure of subscription, any allotment in terms of this prospectus shall be void and the company shall refund the subscription money within 15 (Fifteen) days from the date of refusal for listing by the stock exchanges, or from the date of expiry of the said 75 (Seventy Five) days, as the case may be. In case of non-refund of the subscription money within the aforesaid 15 (Fifteen) days, the Directors of the company, in addition to the issuer company, shall be collectively and severally

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liable for refund of the subscription money, with interest at the rate of 2% (two percent) above the bank rate, to the subscribers concerned. The issue manager, in addition to the issuer company, shall ensure due compliance of the above-mentioned conditions and shall submit compliance report thereon to the Commission within 07 (Seven) days of expiry of the aforesaid 15 (Fifteen) days time period allowed for refund of the subscription money.”

6. All applicants shall apply for a minimum market lot of 500 shares worth Taka 5,000/- (Taka five thousand only) or its multiples.

7. The IPO Shall stand cancelled in case of under-subscription in any category above 35%. In such an event, the Issue manager shall inform the Commission within 2 (Two) working days and release the subscription money within 10 (Ten) working days after receiving verification report from CDBL and the information from exchanges regarding subscription.

8. 20% of the securities reserved for other general public shall be reserved for ক্ষতিগ্রস্থ কু্ষদ্র তিতিয় োগকোরী.

In case of under-subscription under any of sub-categories of eligible investors category or general public category, the unsubscribed portion shall be added to other sub-category of the same category. In case of over subscription in the general public category, the issuer and the issue manager shall jointly conduct an open lottery. In case of over subscription in the eligible investors category, securities shall be allotted on pro-rata basis. No eligible investor shall apply for more than 2% (two percent) of the total securities reserved for the eligible investors.

9. An applicant cannot submit more than two applications, one in his/her own name and the other jointly with another person. In case, an applicant submits more than two applications, all applications will be treated as invalid and will not be considered for allotment purpose. In addition, 15% (fifteen) of the application money will be forfeited by the Commission and the balance amount will be refunded to the applicant.

10. The applicants who have applied for more than two applications using same bank account, their application will not be considered for lottery and the Commission will forfeit 15% of their subscription money.

11. Making of any false statement in the application or supplying of incorrect information therein or suppressing any relevant information in the application shall make the application liable to rejection and subject to forfeiture of 25% of the application money and/or forfeiture of share (unit) before or after issuance of the same by the issuer. The said forfeited application money or share (unit) will be deposited in account of the Bangladesh Securities and Exchange Commission (BSEC). This is in addition to any other penalties as may be provided for by the law.

12. The company shall furnish the list of allotees to the Commission and the stock exchange(s) simultaneously in which the shares will be listed, within 24 (Twenty-Four) hours of allotment.

13. Shares not allotted at the time of according this consent, but allotted after listing, in favor of sponsors, directors or shareholders having 10% or more shares, other than alternative investment funds, through stock dividends, shall be subject to a lock-in period of 02(two) years from the date of issuance of the prospectus.

14. If any share of Sponsors/Directors/Promoters is in paper format, it shall be handed over to securities custodian registered with the Commission and shall remain held till completion of lock-in period and the name of the securities custodian shall be furnished to the Commission

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jointly by the issuer and issue manager, along with a confirmation thereof from the custodian, within one week of listing of the shares with the stock exchange(s). Or they (shares of Sponsors/ Directors/ Promoters) can be demated and shall remain in lock-in under CDBL system and issuer shall submit a dematerialization confirmation report generated by CDBL and attested by Managing Director of the company along with the lock-in confirmation to the Commission within one week of listing of the shares with the stock exchange(s). In respect of shares other than Sponsors/Directors/Promoters the issuer will ensure their lock-in of those shares and submit a statement to this effect to the Commission.

15. The company shall not declare any dividend/bonus shares before listing of its capital with any Exchange from the date of this consent for raising of capital.

16. The company shall not engage itself into any merger/amalgamation or acquisition activities without taking “No Objection” from the Commission, on the scheme of the said merger/amalgamation or acquisition, as recommended by the Board of Directors, before approval by the shareholders in General Meeting.

17. The company shall submit environment clearance certificate for proposed increased production capacity before utilization of IPO proceeds.

PART–B

Application Process Step-1 (Applicant)

1. An applicant for public issue of securities shall submit application/buy instruction to the Stockbroker/Merchant Banker where the applicant maintains customer account, within the cut-off date (i.e. the subscription closing date), which shall be the 25th (twenty fifth) working day from the date of publication of abridged version of prospectus.

2. The application/buy instruction may be submitted in prescribed paper or electronic form, which shall contain the Customer ID, Name, BO Account Number, Number of Securities applied for, Total Amount and Category of the Applicant. At the same time:

a. Other than non-resident Bangladeshi (NRB) and Foreign applicants shall make the application

money and service charge available in respective customer account maintained with the Stockbroker/Merchant Banker. No margin facility, advance or deferred payment is permissible for this purpose. In case the application is made through a margin account, the application money shall be deposited separately and the Stockbroker/Merchant Banker shall keep the amount segregated from the margin account, which shall be refundable to the applicant, if become unsuccessful.

b. Non-resident Bangladeshi (NRB) and Foreign applicants shall submit bank drafts (FDD), issued in favor of the Issuer for an amount equivalent to the application money, with their application to the concerned Stockbroker/Merchant Banker. A Non-resident Bangladeshi (NRB) and Foreign applicant may also submit a single draft against 02(two) applications made by him/her, i.e. one in his/her own name and the other jointly with another person. The draft (FDD) shall be issued by the Bank where the applicant maintains Foreign Currency account debiting the same account and provide the customer with a certificate mentioning the FC account number which has been debited to issue the FDD. The applicant shall also submit the certificate with their application. No banker shall issue more than two drafts from any Foreign Currency account for any public issue. At the same time, the applicant shall make the

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service charge available in respective customer account maintained with the Stockbroker/Merchant Banker.

c. Eligible Investors shall submit application through the electronic subscription system of the exchange(s) and deposit the full amount intended to subscribe by the method as determined by the exchange(s).

Step-2 (Intermediary) 3. The Stockbroker/Merchant Banker shall maintain a separate bank account only for this purpose

namely “Public Issue Application Account”. The Stockbroker/Merchant Banker shall: a. post the amount separately in the customer account (other than NRB and Foreign applicants),

and upon availability of fund, block the amount equivalent to the application money;

b. Accumulate all the application/buy instructions received up to the cut-off date, deposit the amount in the “Public Issue Application Account” maintained with its bank within the first banking hour of next working day of the cut-off date;

c. Instruct the banker to block the account for an amount equivalent to the aggregate application money and to issue a certificate in this regard.

4. Banker of the Stockbroker/Merchant Banker shall block the account as requested for, issue a

certificate confirming the same and handover it to the respective Stockbroker/Merchant Banker.

5. For Non-resident Bangladeshi (NRB) and foreign applicants, the Stockbroker/Merchant Banker shall prepare a list containing the draft information against the respective applicant’s particulars.

6. The Stockbroker/Merchant Banker shall prepare category wise lists of the applicants containing Customer ID, Name, BO Account Number and Number of Securities applied for, and within 03 (three) working days from the cut-off date, send to the respective Exchange, the lists of applicants in electronic (text format with tilde ‘~’ separator) format, the certificate(s) issued by its banker, the drafts and certificates received from Non-resident Bangladeshi (NRB) and Foreign applicants and a copy of the list containing the draft information.

7. On the next working day, the stock exchanges shall provide the Issuer with the information

received from the Stockbroker/Merchant Bankers, the drafts submitted by Non-resident Bangladeshi (NRB) and Foreign applicants and the list containing the draft information. Stock Exchanges shall verify and preserve the bankers’ certificates in their custody.

8. The application/buy instructions shall be preserved by the Stockbroker/Merchant Bankers up to 6 months from listing of the securities with exchange.

Step-3 (Issuer)

9. The Issuer shall prepare consolidated list of the applications and send the applicants’ BOIDs in electronic (text) format in a CDROM to CDBL for verification. The Issuer shall post the consolidated list of applicants on its website and websites of the Exchanges. CDBL shall verify the BOIDs as to whether the BO accounts of the applicants are active or not.

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10. On the next working day, CDBL shall provide the Issuer with an updated database of the applicants containing BO Account Number, Name, Addresses, Parents’ Name, Joint Account and Bank Account Information along with the verification report.

11. After receiving verification report and information from CDBL, the Issuer shall scrutinize the applications, prepare category wise consolidated lists of valid and invalid applications and submit report of final status of subscription to the Commission and the stock exchanges within 10 (ten) working days from the date of receiving information from the stock exchanges.

12. The Issuer and the issue manager shall conduct category wise lottery with the valid applications within 03 (three) working days from the date of reporting to the Commission and the Stock Exchanges, if do not receive any observation from the Commission or the Stock Exchanges.

13. The Issuer and issue manager shall arrange posting the lottery result on their websites within 06 (six) hours and on the websites of the Commission and Stock Exchanges within 12 (twelve) hours of lottery.

14. Within 02 (two) working days of conducting lottery, the Issuer shall:

a. Send category wise lists of the successful and unsuccessful applicants in electronic (text format with tilde ‘~’ separator) format to the respective Exchange.

b. send category wise lists of unsuccessful applicants who are subject to penal provisions as per conditions of the Consent Letter issued by the Commission in electronic (text format with tilde ‘~’ separator) format to the respective Stock Exchange mentioning the penalty amount against each applicant.

c. Issue allotment letters in the names of successful applicants in electronic format with digital signatures and send those to respective Stock Exchange in electronic form.

d. Send consolidated allotment data (BOID and number of securities) in electronic text format in a CDROM to CDBL to credit the allotted shares to the respective BO accounts.

Step-4 (Intermediary)

15. On the next working day, Stock Exchanges shall distribute the information and allotment letters to the Stockbroker/Merchant Bankers concerned in electronic format and instruct them to:

a. remit the amount of successful (other than NRB and Foreign) applicants to the Issuer’s respective Escrow account opened for subscription purpose and unblock the amount of unsuccessful applicants;

b. send the penalty amount of other than NRB and Foreign applicants who are subject to penal provisions to the Issuer’s respective Escrow Accounts along with a list and unblock the balance application money;

16. On the next working day of receiving the documents from the Stock Exchanges, the

Stockbrokers/Merchant Bankers shall request its banker to:

a. release the amount blocked for unsuccessful (other than NRB and Foreign) applicants;

b. remit the aggregate amount of successful applicants and the penalty amount of unsuccessful (other than NRB and foreign) applicants who are subject to penal provisions to the respective ‘Escrow’ account of the Issuer opened for subscription purpose.

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17. On the next working day of receiving request from the Stockbrokers/Merchant Bankers, their

bankers shall unblock the amount blocked in the account(s) and remit the amount as requested for to the Issuer’s ‘Escrow’ account.

18. Simultaneously, the Stockbrokers/Merchant Bankers shall release the application money in the customer accounts; inform the successful applicants about allotment of securities and the unsuccessful applicants about releasing their blocked amounts. The unblocked amounts of unsuccessful applicants shall be placed as per their instructions. The Stockbroker/Merchant Banker shall be entitled to recover the withdrawal charges, if any, from the applicant who wants to withdraw the application money, up to an amount of Tk. 5.00 (five) per withdrawal.

19. All drafts submitted by NRB or Foreign applicants shall be deposited in the Issuer’s respective ‘Escrow’ accounts and refund shall be made by the Issuer by refund warrants through concerned stockbroker or merchant banker or transfer to the applicant’s bank account (FC account which has been debited to apply by NRB or foreign applicants) through banking channel within 10 (ten) working days from the date of lottery.

Miscellaneous:

20. The Issuer, Issue Manager(s), Stockbrokers and Merchant Bankers shall ensure compliance of the above.

21. The bank drafts (FDD) shall be issued considering TT Clean exchange rate of Sonali Bank Ltd. on the date of publication of abridged version of prospectus.

22. Amount deposited and blocked in the “Public Issue Application Account” shall not be withdrawn or transferred during the blocking period. Amount deposited by the applicants shall not be used by the Stockbrokers/Merchant Bankers for any purpose other than public issue application.

23. The Issuer shall pay the costs related to data transmission, if claimed by the Exchange concerned up to an amount of Tk. 2,00,000.00 (taka two lac) for a public issue.

24. The Stockbroker/Merchant Bankers shall be entitled to a service charge of Tk. 5.00 (taka five) only per application irrespective of the amount or category. The service charge shall be paid by the applicant at the time of submitting application.

25. The Stockbroker/Merchant Banker shall provide the Issuer with a statement of the remittance and drafts sent.

26. The Issuer shall accumulate the penalty amount recovered and send it to the Commission through a bank draft/payment order issued in favor of the Bangladesh Securities and Exchange Commission.

27. The concerned Exchange are authorized to settle any complaints and take necessary actions against any Stockbroker/Merchant Banker in case of violation of any provision of the public issue application process with intimation to the Commission.

PART–C

1. The issue manager shall carefully examine and compare the published prospectus and its abridged version on the date of publication with the copies vetted by the Commission. If any discrepancy is found, both the issuer and the issue manager shall jointly publish a corrigendum immediately in

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the same newspapers concerned, simultaneously endorsing copies thereof to the Commission and the stock exchanges concerned. In this regard, the issue manager shall submit a compliance report to the Commission within 5 working days from the date of such publications.

2. The fund collected through Public Offering shall not be utilized prior to listing with Exchange(s) and that utilization of the said fund shall be effected through banking channel, i.e. through account payee cheque, pay order or bank drafts etc.

3. The company shall furnish status report on utilization of Public Offering proceeds audited by foreign affiliated auditors and authenticated by the board of directors to the Commission and the Exchanges within 15 (Fifteen) days of the closing of each month until such fund is fully utilized, as mentioned in the schedule contained in the prospectus. The issuer shall simultaneously post the status report in its website and Exchanges shall also post the same in company information contained in websites of the Exchanges. In the event of any irregularity or inconsistency, the Commission may employ or engage any person to examine whether the issuer has utilized the proceeds for the purpose disclosed in the prospectus.

4. While auditing the utilization of IPO proceeds, the auditors will perform their jobs under the following terms of reference (TOR) and confirm the same in their report/certificate:

a. Whether IPO proceeds have been utilized for the purposes/heads as specified in the prospectus;

b. Whether IPO proceeds have been utilized in line with the condition (if any) of the Commission’s consent letter;

c. Whether utilization of IPO proceeds have been completed within the time schedule/implementation schedule as specified in the published prospectus;

d. Whether utilization of IPO proceeds is accurate and for the purpose of the company as mentioned/specified in the published prospectus; and

e. The auditors should also confirm that: (i) assets have been procured/imported/constructed maintaining proper/required procedure as well as at reasonable price; and (ii) auditors’ report has been made on verification of all necessary documents/papers/vouchers in support of IPO proceeds making reconciliation with Bank Statement.

5. All transactions, excluding petty cash expenses, shall be effected through the company’s bank transfers.

6. Proceeds of the public offering shall not be transferred to any other bank account before listing with the Exchange(s). The proceeds shall not be used for any purpose other than those specified in the prospectus without any valid ground. Any material deviation in this respect must have prior approval of at least 51% of the public shareholders, other than sponsors and directors, in a general meeting through a board approved agenda and due notification to the shareholders. Before the said general meeting, such deviation as recommended by the board of directors shall be published as price-sensitive information with detailed description and reasons for such deviation. If approved by the shareholders, the meeting resolution shall be submitted to the Commission along with reasonable explanations and the decision shall be published as price-sensitive information.

7. If any quarter or half-year of the financial year ends after publication of the abridged version of prospectus and before listing of its securities with any exchange, the company shall

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disseminate/transmit/submit the said quarterly/half yearly financial statements in accordance with the Commission’s Notification SEC/CMRRCD/2008-183/admin/03-34 dated September 27, 2009 and Rules 13 of the Securities and Exchange Rules, 1987.

8. In the event of arising issues concerning Price Sensitive Information as defined under the তিতকউতরটিজ

ও এক্সয়েঞ্জ কতিশি (িুতিধোয় োগী িযিিো তিতিদ্ধকরণ) িীতিিোলো ১৯৯৫, after publication of the abridged version of

prospectus and before listing of its securities with any exchange, the company shall disseminate/transmit/submit the information as price sensitive in accordance with the Commission’s Notification No. SEC/SRMI/200-953/1950 dated October 24, 2000.

PART–D

1. As per provision of the Depository Act, 1999 & regulations made there under, shares will only be issued in dematerialized condition. All transfer/transmission/splitting will take place in the Central Depository Bangladesh Ltd. (CDBL) system and any further issuance of shares (Including rights/bonus) will be made in dematerialized form only.

2. The issuer and the issue manager shall ensure due compliance of all the above conditions, the ‘Bangladesh Securities and Exchange Commission (Public Issue) Rules, 2015’ and the listing regulations of the exchanges.

3. The Commission may impose further conditions/restrictions etc. from time to time as and when considered necessary which shall also be binding upon the issuer company.

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SECTION (III): DECLARATION AND DUE DILIGENCE CERTIFICATES

DECLARATION ABOUT THE RESPONSIBILITY OF THE DIRECTOR(S), INCLUDING THE CEO OF “SILCO PHARMACEUTICALS LIMITED (SPL)” IN RESPECT OF THE PROSPECTUS

[Rule 4(1) (d)]

This prospectus has been prepared, seen and approved by us, and we, individually and collectively, accept full responsibility for the authenticity, accuracy and adequacy of the statements made, informatio

Documents

educationnewsbd24blog - PROSPECTUS OF · 2019. 3. 30. · "This being the first issue of the issuer, there has been no formal market for the securities of the issuer. The face value