Lub-rref Struggles to Pay Dividend

Industry: Automotive, Energy & Power, Lubricant, Oil & Petroleum
Company: Lub-rref (Bangladesh) Ltd.
Company Intelligence Tag: Business Insights

Lub-rref (Bangladesh) Ltd, a lubricant producer, is facing a liquidity shortage that has hindered its ability to pay the recommended 10% cash dividend for the fiscal year 2021-22. The company has managed to pay the dividend to only 50% of eligible shareholders so far. The crisis is attributed to excess funds being used for raw material imports. The Bangladesh Securities and Exchange Commission (BSEC) has formed an inquiry team to investigate dividend issues and other relevant matters concerning the company. Lub-rref is currently operating at around 30% of its normal production capacity due to the liquidity crisis. The company has also requested permission from the commission to use its remaining IPO funds as working capital. Despite the challenges, Lub-rref recorded a 17% year-on-year profit growth in the third quarter of the current fiscal year.

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