Alif Industries to invest Tk 400cr to expand its business in garment sector

Alif Industries a knit-based factory to produce yarn as part of efforts to reduce import dependency plans to invest Tk 400 crore to expand its business in the garment sector. The main focus is to develop backward linkage industry in the readymade garment sector.

The company will raise the capital to set up a spinning mill with the capacity of running 50,000 spindles and another green plant consisting of 25 production lines to manufacture woven denim.

The company will raise the money by issuing three crore ordinary shares at an average price that is 30 times of its earnings per share and the three months’ moving average of the market price.

The EPS of the company was Tk 1.39 in the October-December period last year, according to the DSE.

Shares of the company were traded at Tk 105.60 yesterday at the prime bourse. In the last three months, the share price of Alif Group ranged between Tk 143 and Tk 95, DSE data showed.

The company prefers the stock market for sourcing the funds instead of bank loans as the market price of the company’s shares remained high, said Azimul Islam, managing director of Alif Group. Their directors will make equity investment if they don’t get expected investors.

Alif Industries will hold an extraordinary general meeting to win the approval in favour of its investment decision on March 11 and later the proposal will be sent to the Bangladesh Securities and Exchange Commission for permission.

Alif Industries, previously known as Sajib Knitwear, was listed with the capital market in 1995. The company started trading in the main market in December last year following its return from the over-the-counter market.

Alif Group also bought CMC Kamal Textil Mills from AHM Mustafa Kamal, the planning minister, and changed the name of the company to Alif Manufacturing Company in December last year. The group has been involved in the garment business for over three decades. Starting with Alif Garments Ltd, it now has eight garments factories.

These companies produce woven tops and bottoms and employ about 8,000 people. The group has recently acquired Shadhin Garments that has 100 production lines, according to the group’s profile.