Confidence power applies for IPO to raise Tk 400 crore

Confidence Power and Energy PLC wants to raise Tk 400 crore from the stock market through an initial public offering (IPO). To this end, the company has applied to the Dhaka Stock Exchange (DSE) for approval to launch an IPO under the book building method. A major portion of the proceeds will be invested in two proposed solar power projects. The company also plans to use the funds to partially repay existing loans and cover IPO related expenses, according to relevant sources.

According to the sources, Confidence Power and Energy submitted the application to the managing director of the DSE on October 28. The application seeks permission to raise capital through an IPO under the book building method in accordance with the Public Offer of Equity Securities Rules, 2025, and other applicable laws and directives of the Bangladesh Securities and Exchange Commission (BSEC). The process of issuing shares and raising funds will depend on subsequent decisions by the DSE and BSEC.

According to company sources, Confidence Power and Energy was established in 2017 as part of Confidence Group. The company operates as an independent power producer. Within two years of its establishment, it commissioned four power plants with a combined generation capacity of 393.363 megawatts in collaboration with its subsidiaries.

According to the company’s plans, it aims to expand its business into the renewable energy sector alongside conventional power generation. To this end, it has planned investments in two proposed solar power projects. The majority of the IPO proceeds will be spent on implementing these projects. The company expects this move to diversify its energy business and create opportunities to expand its generation capacity over the long term.

In addition, a portion of the existing loans will be repaid using the IPO proceeds. This is intended to improve the company’s capital structure and strengthen its financial position. The funds will also cover IPO related expenses. However, the application does not specify the exact amount to be invested in each project or the amount to be spent on loan repayment.

As part of the proposed IPO, the company organized a roadshow at the Radisson Blu Water Garden Hotel in Dhaka on October 18. The event was held as part of the share price determination process under the book building method. During the roadshow, the company presented its business operations, financial position, future prospects, business risks and plans for using the IPO proceeds to eligible investors. Following the event, the company submitted its application along with the necessary documents to advance the IPO approval process.

The application included a Tk 50,000 pay order issued by Midland Bank in favor of the DSE, copies of the company’s registration documents and memorandum and articles of association, a board resolution, consent letters from directors, land ownership documents, and lists of machinery and equipment at its power plants. Six copies of the red herring prospectus were also attached to the application.

Under the book building method, the cutoff price of shares is determined through the participation of eligible investors. The share price and allocation for general investors are then finalized through the prescribed process. Confidence Power and Energy must also complete the price determination and IPO approval process in accordance with the applicable regulations.

The company’s proposed IPO is still awaiting approval. Permission to raise funds from the stock market through the IPO will be granted after the submitted prospectus is reviewed and scrutinized.