Crisis worsens for Renwick Jajneswar as sweets go bankrupt
- Established in 1881
- Losses incurred up to FY2003-04
- Profit for 16 years – from FY2003-04 to FY2018-19
- Then again started to incur losses from fiscal year 2019-20
- Losses in Fiscal Year 2019-20 – Tk6.47 crore
- Losses in fiscal year 2020-21 – approximately Tk5.50 crore
- Amusement park built on unused land
- A market to be built on the unused land
- Five-member task force formed by Bangladesh Sugar & Food Industries Corporation to find ways to make the business profitable
Renwick Jajneswar & Company (Bd) Ltd – a supplier of spare parts for sugar factories – suffered huge losses due to declining sales due to the closure of several factories.
The government has decided to close six sugar companies for reform and modernization in 2020 amid the Covid-19 pandemic.
As a result, the state-owned company was unable to supply its products to these factories, which further reduced its income.
According to its officials, the company, established on 38.98 acres of land in Kushtia in 1881, was initially profitable but now suffers huge losses from bad debts and overspending.
They said the company made an average of around Tk 15 crore each year, repairing and making parts for the candy stores. However, due to the closure of the six factories, revenues have dropped significantly.
Although he earned more than Tk13 crore in fiscal year 2019-20, he was only able to earn Tk6 crore in the following fiscal year.
Speaking to The Business Standard, Al-Wadud Amin, Managing Director (MD) of the company, said, “We were a profitable business. payment of arrears declared by the government and crisis of funds. “
“Our income has declined due to the lack of work orders from the six closed sugar factories. Our entire business now relies on just nine of these factories.
“However, various efforts are being made to overcome our financial difficulties. If things are done right, we can make a turnaround,” added the managing director.
The company, in 2018, built an amusement park on its unused land near the banks of the Gorai River in an effort to find alternative sources of income.
He made substantial profits from the park, but that was also cut short due to the nationwide lockdown led by the coronavirus.
Officials said there were also plans to build a market to mitigate their losses.
Meanwhile, a five-member task force has been formed by the Bangladesh Sugar & Food Industries Corporation to find ways to make the business profitable while prioritizing the interests of investors.
The committee was instructed to submit its findings to the Ministry of Industry.
Al-Wadud Amin said: “A task force has been formed to increase the income of the company. He will submit a report on his findings.
“Our amusement park has reopened and revenues are improving. We hope for a turnaround.”
Strong presence on the equity market
Despite continued losses, the company’s stock price recently stood at Tk 1,261, the ninth highest for companies listed on the capital market.
The company, nationalized in 1972, has however not declared any cash dividends for its shareholders since the 2017-2018 financial year, when it was able to provide a dividend of 12%.
According to the Dhaka Stock Exchange (DSE), the market cap of the company is Tk 258.40 crore.
Of the total 20 lakh shares, the government owns 51% while the remaining 49% is owned by the public.