-Paid up capital Tk 130.97 cr
-Current loan Tk 387.62 cr
Mahfuz Emran: Capital market-listed Aman Feed is caught in the net of debt. With a paid-up capital of Tk 130.97 crore, the debt of this company is Tk 387.62 crore. That means the debt is about three times the capital of the company. Even the fixed assets of the company, the amount of debt is more than double. The issue of the company’s debt has reached the court. However, the amount of debt has not decreased, on the contrary, the amount of debt is increasing with time.
On the one hand, the company is stuck in the web of debt, on the other hand, the money taken from the capital market investors has not been utilized properly. It even gave false information to the regulatory body Bangladesh Securities and Exchange Commission (BSEC). Because of that, BSEC fined all the directors of the company Tk 25 lakhs.
It is known that a bank published a notice in the newspaper to auction the land of Aman Feed on August 7, 2020 due to non-payment of loan. According to the notification, the bank owed Tk 268.4 million to Aman Feed including loan and interest till July 31, 2020.
The company resorted to the court when it took the initiative to auction the land of bank Aman Feed to collect the money due. In June last year, the court had restrained the auction sale of Amani Feed’s mortgaged properties. In view of this, the auction sale of the company’s land has been suspended for the time being.
On the other hand, even after such a scandal regarding loans, Aman Feed’s loan amount has not decreased. Rather, the company’s debt seems to be increasing with time. According to the latest published annual report of the company, their total debt at the end of the financial year ended June 2021 was Tk 385.62 crore.
Out of this, long-term debt is Tk 186.88 crore. A year ago i.e. in June 2020, the long term debt was Tk 171.95 crore. In June 2019, long term debt was Tk 156.33 crore. That is, the company’s long-term debt increased consistently every year.
Along with long term loans, short term loans have increased consistently. According to the June 2021 financial report, the short-term debt of the company is Tk 174.58 crore. A year ago in June 2020, the amount of this loan was 160.85 crore. In June 2019, it was Tk 142.47 crore.
In addition, the current portion of the company’s long-term debt in June 2021 is Tk 23.46 crore. A year ago in June 2020, the current portion of long-term debt was Tk 15.42 crore. In June 2019, the current portion of long-term debt was Tk 10.39 crore.
Meanwhile, the amount of fixed assets of the company is decreasing year by year in addition to abnormal debt. At the end of June 2021, the fixed assets of the company stood at Tk 143.43 crore. A year ago in June 2020, fixed assets were Tk 148.21 crore. Fixed assets in June 2019 were Tk 153.84 crore. That is, the fixed assets of the company have decreased consistently.
In other words, on the one hand, the company’s fixed assets have decreased, on the other hand, the amount of debt has increased. In the span of two years, the company’s fixed assets have decreased by Tk 10.41 crore. On the contrary, the loan amount has increased by Tk 72 crore. In this, compared to fixed assets, the company’s debt has increased more than twice. Against the fixed assets of Tk 143 crore, the debt amount of the company stands at Tk 385 crore.
Aman Feed, which was listed on the stock market in 2015, also committed irregularities in the use of IPO money. In 2015, the company collected Tk 72 crore from the stock market through IPO. According to the IPO prospectus, the time limit for disbursement was 15 months from receipt of funds or September 27, 2016. But the company could not spend the IPO money within the stipulated time.
In 2020, the audit report of audit firm MABS & J Partners revealed irregularities against Aman Feed in the use of IPO funds. In view of which the then commission of BSEC fined each director of the company 25 lakh rupees.
At that time BSEC informed that Aman has violated Section 18 of the Securities and Exchange Ordinance 1996. In addition, the Commission has violated conditions 4, 8 and 9 of the letter of approval.
When contacted to know about this, the company secretary of Aman Feed Masud Karim told, “I have just joined Aman Feed. Therefore, I cannot comment on anything without making inquiries.
Financial reporting expert and former chairman of BSEC Farooq Ahmed Siddiqui said that debt should not be more than 20 to 30 percent of an organization’s assets. If the debt is high and the company is not making good profits, then the company may be at risk.
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