Staff Correspondent: Bangladesh’s 100 per cent export-oriented footwear manufacturer Royal Footwear PLC is turning to the capital market to raise funds to double its production capacity and expand into new international markets, as demand for its products has increased significantly, the company’s chairman said.

“We have been operating in the footwear sector with a good reputation for a long time. Demand for our products has now increased manifold. We need additional capital to double our production capacity and enter new markets,” Royal Footwear Chairman Md Zakir Hossain Patowary said.

He said the funds to be raised through the company’s listing on the capital market would play the most important role in enabling Royal Footwear to expand its business rapidly.

The Bangladesh Securities and Exchange Commission (BSEC) has approved the company’s Initial Qualified Investor Offer (IQIO), paving the way for the export-oriented manufacturer to raise fresh capital from the country’s primary capital market.

Royal Footwear currently exports international-standard footwear to Germany, Italy, Poland, Switzerland, the United States and the United Arab Emirates, among other markets, according to the company.

The company also manufactures footwear for several leading global brands, including Deichmann, Intersport, Arena, Red Tape, Bata, CAT, Fila and CCC.

The chairman said the company’s growing international business has created a need to expand production capacity and strengthen its ability to serve both existing and new overseas customers.

The move comes at a time when Bangladesh is seeking to diversify its export basket beyond traditional sectors. Industry observers believe the expansion of export-oriented footwear manufacturers could help strengthen the country’s position in the global footwear market while creating an additional source of foreign-exchange earnings.

According to the company’s prospectus, all products manufactured by Royal Footwear are exported to overseas markets, while international buyers include major European companies.

Tk 12 crore to be raised

Under the IQIO, Royal Footwear will issue 12 million ordinary shares, each with a face value of Tk 10, exclusively to eligible investors, aiming to raise Tk 120 million (Tk 12 crore).

According to the company, the funds raised through the capital market will support its expansion plans.

The prospectus states that a significant portion of the funds will be used for working capital, procurement of raw materials and machinery, while a portion will be used to repay existing bank loans.

For an export-oriented manufacturer, increased working capital and access to machinery are crucial for maintaining uninterrupted production and meeting delivery requirements of overseas buyers.

The company expects the additional capital to help accelerate its expansion and strengthen its capacity to respond to rising international demand.

Export growth at the centre of expansion

Royal Footwear’s decision to enter the capital market comes with a clear focus on expanding its export business.

The chairman said the company needs to double its production capacity and capture new markets. This indicates that the planned capital raising is closely linked to the company’s ambition to increase its international footprint.

Market observers say stronger participation of export-oriented manufacturers in the capital market could create a closer connection between capital-market financing and export-led industrial growth.

If the additional capital enables Royal Footwear to increase production and overseas sales, the expansion could contribute to Bangladesh’s export diversification and foreign-exchange earnings.

Financial Status

According to the company’s half-yearly report for the period ended December 31, 2025, Royal Footwear reported earnings per share (EPS) of Tk 0.82.

Its net asset value (NAV) per share stood at Tk 27.54 during the period, according to the company.

The company’s management believes that becoming a listed entity will also strengthen its financial transparency, independent auditing and accountability.

Listing to strengthen global credibility:

Royal Footwear said capital-market listing would bring greater transparency and accountability to its operations through regular financial reporting, independent audits and regulatory disclosures.

This is particularly important for the company because a significant portion of its business is linked to international buyers.

According to the company, compliance and corporate governance are highly important to European buyers. As a result, the listing is expected to enhance Royal Footwear’s acceptability and credibility among global customers.

Market observers also see stronger governance and disclosure as potential advantages for an export-oriented company seeking to deepen relationships with international buyers.

Listing on the stock market will subject the company to regular financial reporting, audited accounts, disclosure of price-sensitive information and other BSEC requirements. Such obligations can strengthen transparency and accountability.

Royal Footwear currently employs 876 full-time officers and workers, according to its prospectus. Although the company has not specified the number of additional jobs it expects to create, doubling production capacity and expanding exports could generate new employment opportunities.

The expansion could also benefit supporting sectors such as transportation, packaging and raw-material supply.

For Bangladesh, the broader significance of Royal Footwear’s capital-market entry lies in its export-oriented business model. Unlike companies focused primarily on the domestic market, Royal Footwear earns its revenue from international markets and has established relationships with major global brands.

The company’s planned expansion could therefore help demonstrate how the capital market can support export-oriented industrialisation.

With demand rising, production capacity targeted to double and new international markets in focus, Royal Footwear expects its capital-market listing to provide the financial foundation needed for its next phase of growth.

For the country’s capital market, meanwhile, the entry of a fully export-oriented manufacturing company could offer investors greater exposure to Bangladesh’s growing non-traditional export industries.