Baraka Power diversifies into garment

Baraka Power, a joint venture between local and non-resident Bangladeshi entrepreneurs, has bought Bela Fashions, an export-oriented woven garment factory, for Tk 30 crore to diversify its business.

The acquisition will add about Tk 7 crore net earnings per year for Baraka, according to the company's disclosure to the Dhaka Stock Exchange.

“Baraka wants to diversify its business vertically to mitigate the risks associated with electricity business,” Monoj Das Gupta, senior manager (finance) of the company, told The Daily Star yesterday.

The electricity business is restricted and none can go for expansion without the government's permission, which has led Baraka to explore options in other areas. Baraka will invest another Tk 10 crore in addition to the acquisition cost to modify the 10-line factory. The debt and equity ratio in Tk 40 crore will be 70:30, according to the company.

Incorporated in Bangladesh in June 2007, Baraka has a power plant in Fenchuganj, Sylhet that generates 51 megawatts of electricity. Baraka Patenga Power, a 51 percent subsidiary company of Baraka Power, generates and supplies 50MW on a build-own-operate basis.

Baraka got listed in the Dhaka and Chittagong stock exchanges in May 2011. Each Baraka Power share traded at Tk 41.7 yesterday on the Dhaka Stock Exchange. Earnings per share of Baraka were Tk 0.77 in the first quarter of 2017, up from Tk 0.74 a year earlier.