Hemas to focus on Bangladeshi market
Hemas Holdings PLC raised Rs 4.1 billion of new capital through its recent Rights Issue to finance its expansion plans in healthcare and personal care – especially for expansion in their Bangladeshi market segment, officials said.
An official said that Hemas’ fully owned distribution network for FMCG products was launched in Bangladesh last November. “After one year, we launched this for our Kumarika hair care products. With this channel a huge growth opportunity is there for us in Bangladesh in FMCG,” he said.
According to him, Hemas is thinking about a regional strategy starting with Bangladesh. Pakistan in this regard (as a market) is an idea Hemas is exploring.
Hemas’ Healthcare sector saw 16.2 per cent year on year (YoY) revenue growth during the past quarter recording Rs. 3.6 billion led by improved performance of hospitals with a notable contribution from the newly added 55 bed Thalawathugoda hospital which completed its first fully operational year as of end 1QFY15, analysts said.
J.L. Morison Sons & Jones which was acquired by HHL in May 2013 added to the growth recording a revenue increase of some 44 per cent YoY, the official said, adding that the upgrading of the manufacturing facility which took place in 1QFY15 contributed to the revenue increase while sector investments in over the counter and consumer portfolio also boosted revenue.
A media release by the company said that the capital raised is one of the most significant on the Colombo Stock Exchange in recent years, with the majority of capital being raised from world leading institutional investors.
Steven Enderby, Group CEO said, “We have made a number of key strategic moves recently through the acquisition of JL Morison which has enhanced our presence in pharmaceuticals, the development of our personal care business in Bangladesh and the opening of our third hospital, while divesting our shares in power. It is important for us to have the capital base to continue this growth trajectory while becoming increasingly focused on our strong presence in healthcare and personal care. We thank our shareholders for the confidence placed in our business.”
The statement added that in a bid to accommodate this demand the major shareholders of Hemas, the Esufally family, decided not to subscribe for their rights in order to enable these parties to become shareholders or increase their shareholding.
As a result of the Rights Issue being fully subscribed to, the shareholding of the major shareholder (Esufally family) reduced from 71.26 per cent to 64.14 per cent. Hemas Holdings was advised in this capital raising exercise by CT CLSA Capital (Pvt) Ltd.