Marico tops dividend payers' chart - Share market analysis of dhaka stock exchange, Bangladesh

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19 January, 2015 09:40 AM Source: The Daily Star Bangladesh

Marico Bangladesh offered 900 percent cash dividends in total last year, the highest among all listed companies, after it rolled out a 500-percent special dividend to mark the multinational firm's 12 years in the country.

Marico that makes fast-moving consumer goods led the other 224 equity companies that disbursed dividends ranging from 5 percent to 620 percent in 2014.

The 500-percent dividend was a one-off, said Iqbal Chowdhury, finance director of Marico Bangladesh.

The company also offered special discounts in every product category for its consumers and special incentives to employees to mark the occasion, he said.

Net profit of Marico Bangladesh, a leader in FMCG and a subsidiary of Mumbai-based Marico group, was Tk 139 crore for the year that ended in March.

Earnings-per share of the company, which was listed in Bangladesh stockmarket in 2009, stood at Tk 43.99, net asset value per share Tk 54.16 and net operating cash flow per share Tk 85.84.

British American Tobacco Bangladesh Company, Reckitt Benckiser, Linde Bangladesh, Heidelberg Cement, Glaxo SmithKline, Bata Shoe, Berger Paints and Grameenphone were the other companies that gave over 100-percent dividends last year.

The healthy dividends show that multinational companies (MNCs) are doing well in the country,

The MNCs' capital structure is comparatively small and their retained earnings higher, since they usually do not go for expansion, said Faruq Ahmad Siddiqi, former chairman of Bangladesh Securities and Exchange Commission.

So, they can afford higher dividends, he said, adding that MNCs prefer to give cash dividends.

In contrast, the local companies prefer to give bonus dividends, he said, adding that bonus dividends reduce the ability to pay out dividends in future. Dividend in cash is an indicator of the financial soundness of a company and its ability to share profits with shareholders, he said.

However, the tendency to give bonus dividends is declining in recent days, Siddiqi added.

Of the 225 companies that disbursed dividends last year, 91 gave cash dividends, 74 bonus dividends and the rest 60 both cash and bonus dividends, according to data from the Dhaka Stock Exchange.

Some 28 listed equity companies did not give dividends at all last year.


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