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GPH Ispat defers Tk968cr rights share issue amid weak market conditions
27 Oct 2026
Source: The Business Standard

GPH Ispat Limited has deferred its proposed Tk968 crore rights share issue, citing prevailing capital market conditions and the need to safeguard the interests of the company and its general shareholders.

The decision was reviewed at a board meeting on 24 October and subsequently placed before shareholders at the company's annual general meeting on 25 October, where it was formally deferred.

Following the disclosure to the Dhaka Stock Exchange (DSE) today (26 October), the company's share price fell 2.53% to close at Tk15.40.
The steelmaker had planned to raise nearly Tk968 crore by issuing 96.78 crore rights shares at a face value of Tk10 each, offering two rights shares for every existing ordinary share.

The proceeds were primarily intended to repay bank loans amid sluggish domestic demand and persistent energy shortages affecting the steel sector.

The company said the proposal would be reconsidered once market conditions improve.

The postponement comes as GPH Ispat grapples with a heavy debt burden. As of 30 June 2026, it had long-term loans of Tk4,088 crore and short-term borrowings of Tk2,802 crore, taking total debt to around Tk6,890 crore. Total liabilities rose 9% year-on-year to Tk8,319 crore in FY26.

To ease its financial strain, the company recently approached Bangladesh Bank seeking a four-month waiver or relaxation of Credit Information Bureau (CIB) requirements.

In a letter to the central bank governor on 24 September, GPH Ispat said procedural requirements were hindering its ability to secure banking facilities and complete debt restructuring negotiations with more than two dozen banks and financial institutions.

Operational challenges have also hit the steelmaker's revenue. Net revenue fell 29% year-on-year to Tk3,940 crore in FY26 from Tk5,606 crore a year earlier.

Revenue from its core MS rod sales dropped 29% to Tk4,038 crore, while MS billet generated no revenue during the year. Income from industrial gas fell 37% to Tk22.72 crore, while export earnings plunged 55% to Tk8 crore.

Net profit plummeted to Tk3.54 crore, leaving the company with a net profit margin of just 0.08%. It remained barely profitable mainly due to lower management expenses and a reduced income tax burden.

Speaking to The Business Standard on condition of anonymity, a senior company official attributed the operational crisis to a severe cash crunch. The liquidity shortage has prevented the company from opening letters of credit (LCs) to import scrap metal and essential raw materials, forcing its factories to operate well below capacity.

 
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