125 listed companies fear heavy losses
Sunbd Desk || Published: 2020-05-04 10:10:17 || Updated: 2020-05-04 10:10:17
Stock market insiders said the coronavirus outbreak had cast a negative impact on the revenue and net income of companies in the manufacturing and service sector
Some 125 publicly-traded companies in the manufacturing and service sectors have expressed fears of heavy losses due to the ongoing coronavirus outbreak.
Among them, 116 companies are in the manufacturing sector, such as RMG, cement, ceramics, engineering, and tannery sector. The other nine are in the real estate and service sector.
These companies are listed on the country’s prime bourse Dhaka Stock Exchange (DSE), out of a total of 321 listed companies.
Talking to Dhaka Tribune, higher officials of these companies said they forecast a huge decline in revenue in the third quarter and annual profit from after the pandemic began.
Stock market insiders said the coronavirus outbreak had cast a negative impact on the revenue and net income of companies in the manufacturing and service sector. Therefore, investors will be deprived o their profits.
Meanwhile, some listed companies have also suspended productions due to the lack of demand and disruption in the global supply chain, and also to minimize spread of the virus among employees.
Impact on listed companies in the manufacturing sector
Industry insiders have expressed concerns over a huge fall in earnings of 56 export-oriented textile and apparel companies listed at the DSE.
Global clothing brands and retailers have cancelled import orders worth $1.40 billion from Bangladesh after the pandemic hit their business badly, mostly in the European and US markets.
According to Bangladesh Garment Manufacturers and Exporters Association (BGMEA), a total of 347 apparel exporters faced work order cancellations worth $927 million. Another 220 exporters belonging to the BKMEA also faced cancellations of work orders worth $480 million.
The pandemic also slowed down the cement, ceramics, and the engineering sector. There are 51 companies in this sectors listed with the DSE.
Bangladesh Steel Manufacturers Association General Secretary Md Shahidullah said his sector is now facing a shortage in raw materials as European nations and the United States, where the raw materials usually comes from, has been gripped by the coronavirus outbreak.
Shahidullah, also vice-president of the Bangladesh Cement Manufacturers Association, said the cement companies used to meet the demand of government projects, corporate projects, and individual homebuilders, but in the current situation, all their activities have come to a standstill.
Earlier on April 12, LafargeHolcim Bangladesh declared layoffs at its head office in Dhaka due to a fall in sales from the shutdown enforced to curb the spread of the virus.
Standard Ceramic Industry has already closed its factory due to the outbreak.
Beside, the six listed tannery and footwear companies had kept their operations halted since the general holidays began on March 25.
Industry insiders fear many of these companies will collapse and many employees might lose their jobs.
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