Navana Pharma IPO price discovery from July 4

Navana Pharmaceuticals Ltd will begin the process to discover the cut-off price of its shares under the book-building method of the initial public offering on July 4. 

The bidding period for eligible investors will continue until July 7, said the Dhaka Stock Exchange in a notice on its website yesterday.

It comes amid the criticism of the bidding process of the Bangladesh Securities and Exchange Commission (BSEC) since eligible investors don't get enough time to make bids and win stocks. For example, eligible investors got less than 10 seconds to win bids in case of the IPO of JMI Hospitals.

Mohammad Rezaul Karim, a spokesperson of the BSEC, said that until the Public Issue Rules were amended, the share allocation on the "first come first served" basis would continue.

An asset manager said as the BSEC has fixed the valuation process of a stock, all eligible investors quote almost the same price.

"But those who bid first win the shares. The BSEC should allocate shares among all of the top bidders."

The valuation report submission period for eligible investors through the electronic subscription system of the exchanges will start on July 12 and continue till July 14.

Eligible investors, namely pension funds, recognised provident funds and gratuity funds, that intend to submit applications must maintain a minimum investment of Tk 1.5 crore. It is Tk 3 crore for other eligible investors.

The minimum bidding value shall be Tk 20 lakh, said the notice.

Navana Pharmaceuticals plans to raise Tk 75 crore through the IPO.

The company's net profit after tax stood at Tk 19.18 crore and earnings per share were Tk 2.39 in the July-March period of the current financial year.