IDLC INVESTMENTS MANAGES ROBI’S IPO: THE BIGGEST EVER IN BANGLADESH
IPO Snapshot
Bangladesh Securities & Exchange Commission has approved the IPO of Robi Axiata Limited on September 23, 2020 in its 741st Commission Meeting. With an issue size of BDT 5,237 million, Robi is set to be the biggest ever IPO in the history Bangladesh.
The following outlines some of the highlights of Robi’s IPO:
The capital market of Bangladesh has witnessed large scale IPOs in the past, but none had crossed the BDT 5,000 million mark and through this, Robi has set a new benchmark for mega IPOs in Bangladesh. Furthermore, the last IPO of a multinational company took place around a decade ago. Also, as the second entrant of the telecommunication sector in the capital market, the listing of Robi will significantly boost the market capitalization. The fund raised from IPO will be used in network expansion.
Robi and Telco Outlook
Robi was incorporated as a public limited company on October 22, 1995 as TM International (Bangladesh) Limited with the brand name ‘Aktel’. In 2010, it was rebranded as ‘Robi’ and the Company changed its name to Robi Axiata Limited.Robi Axiata Limited is a subsidiary Company of Axiata Investments (Labuan) Limited, which is also the subsidiary of the leading Asian telecom giant, Axiata Group Berhad, based in Malaysia. Other shareholders in the entity include Axiata Group Berhad, Bharti International (Singapore) Pte. Limited. Robi is the second largest mobile network operator in Bangladesh with 49.100 million subscribers as of end of July 2020.1
Role of IDLC Investments
IDLC Investments worked as the corporate advisor for the Robi-Airtel merger, which till date has been one of the biggest merger in Bangladesh. Robi initiated its plans to go public in early 2019 and subsequently appointed IDLC Investments as the issue manager for this journey. Being awarded as the “Best Investment Bank in Bangladesh” by Euromoney Awards for Excellence for three consecutive years since 2018, IDLC Investments has managed some of the cornerstone IPOs of the country, which includes that of Berger Paints Bangladesh Limited, Marico Bangladesh Limited, first ever IPO in Bangladesh to exercise “Green Shoe Dilution Option” and RAK Ceramics (Bangladesh) Limited, the first ever IPO under Book-Building method in Bangladesh.
Mr. Arif Khan, CEO and Managing Director of IDLC Finance commented “We are really proud to be the issue manager for this largest IPO. We believe this initiative will further foster the growth of the telecommunication sector. IDLC will continue introducing such well-governed companies, bringing a positive impact in Bangladesh’s capital market.”
Mr. Md. Moniruzzaman, Managing Director of IDLC Investments added “Our focus on good governance has been the key driver in execution of IPOs. A coherent ideology between the management of the issuer and issue manager is vital for the successful completion of IPO. Robi’s IPO has yet again proven the operational excellence of IDLC Investments and we shall continue to steer towards this path for the foreseeable future.”
Apart from IPO, merger & acquisition, IDLC Investments is also engaged in portfolio management and margin lending business and looks forward to build a better investment ecosystem in the capital market of Bangladesh.
DELIVERY SERVICES AMIDST PANDEMIC : SAFEGUARDING CONSUMER DEMAND
Delivery Service to the rescue for consumer demand in a pandemic-driven world
A global event as prominent as the COVID-19 outbreak is likely to have an impact on the life style of people all over the world. Thus, a sudden change in consumer behavior is not surprising, rather rational. However, the success of a business depends on how fast and efficiently it can cope up with any unfavorable situation as risk is a fundamental element of any business. Before pandemic, the biggest vertical to deliver for logistic service providers of the country was e-commerce and f-commerce, covering around 60% of the whole pie which mostly consisted luxury products. After the corona virus outbreak, in no time the demand for grocery and essentials reached sky-rocket. The market leader, Chaldal was receiving 16,000 orders per day which was only 2,500 before pandemic. On the other hand, food delivery services dropped by 80% since all the restaurants were closed. However, when the whole country was staying inside home in order to minimize Covid-19 contamination, the logistics service providers were serving day and night to cater the sudden shift of the consumer demand. They responded to the situation swiftly by either extending their verticals or shifting their concentration to adjust the shift in market dynamics. As we are moving on with this new normal arrangements, the booming sectors must capitalize on this opening at once and focus on practices like consumer retention, that will make this growth more sustainable. On the other hand, a post COVID-19 boom for the verticals which are lagging behind, seems to be on the cards.
Sushmita Saha
Assistant Manager
IDLC Finance Limited