Volume 13 l Issue 10 l October 2017

SUPERMARKETS: NEW TREND

IN URBAN SHOPPING
RESHAPING MODERN RETAIL TRADE
2 of 40
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FROM THE
EDITOR
Supermarkets in Bangladesh:
Leveraging Convenience and Availability for Urbanites
A “fresh from the oven” news, turned the spotlight
on Bangladesh in international premise.
Minhaj Chowdhury, the Bangladeshi entrepreneur
has won the first-ever “Under 30 Impact Challenge”
at the Forbes Under 30 Summit in Boston, USA.
He started a water technology company named
“Drinkwell”, which combats arsenic, fluoride
and iron contamination in water and currently
operating in Bangladesh and India.
A quite obvious industry trend of Bangladesh
is: it hits a global trend in its lateral waves. Take
Supermarket industry as a case in point. Global
Supermarket is a 100 year old industry and
Bangladesh became a part of it in early 2000s. The
Supermarket industry in Bangladesh is making
strides towards expansion in a steady manner
with three key players. In the last couple of years,
the industry witnessed few positive turns: a
INDUSTRY & EQUITY ANALYSIS TEAM
ASIF SAAD BIN SHAMS ADNAN RASHID
Email: shams@idlc.com Email: adnan@idlc.com
gradual shift in consumer shopping preference to
supermarkets from the mom-and-pop shops or
kitchen/wet market, a great deal of offers by the
Superstores to catch the middle and lower-middle
slice of the social class. Supermarkets have already
jumped the e-commerce bandwagon in order
to take consumers’ convenience in shopping to
the next level. In a city like Dhaka, full of hustle-
bustle, where the average traffic speed dropped to
7km/hour from 21 km/hour in just five years, the
initiative is much time befitting. However, this
is just the start. The industry is yet to create the
perfect blend between online and offline shopping
experience in one seamless platform and it has
some way to go to reach that level.
Adnan Rashid
Assistant General Manager
IDLC Finance Limited
SUSHMITA SAHA
Email: sushmita@idlc.com
 contents

04
Research In Focus
21
Entrepreneurs’ Corner
32
Industry Update
NBFC In India: The Changing Exclusive Sweets Ltd. • Agent Banking
Landscape • RMG

06 21
• Power
• Cement

Cover Story
34
IDLC News
Supermarkets: New trend
in urban shopping
The Supermarket industry in Bangladesh got off the
ground in early 2000s. During this timeframe, the
industry witnessed a steady growth. Mostly run by
22
Economy At A Glance
The Month In Brief
three key players- Shwapno, Agora and Meena Bazar,

36
the industry brought a major shift of consumers’

24
shopping preference from the mom-and-pop stores
to the superstores, to a certain extent. Not only that,
it is accountable for a larger chunk of employment
generation- starting from the root-level farmers to
the urban university-goer storekeepers.
Spotlight on Startup For the Record

14 Kiksha.com

37
EXPERT OPINION
26
Design & Printing: nymphea l www.nymphea-bd.com

Becoming a Brand
Sabbir Hasan Nasir Youth Leadership Analytics
Executive Director, Shwapno (ACI Logistics) An Evaluation of the Performance of
LightCastle Partners
Independent Marketers’
Association (IMA) New Commercial Banks

18
EXPERT OPINION 28 38
Tale Of Growing Steady Trailblazers Capital Market Review
Shaheen Khan In Conversation with
CEO, Gemcon Food and Agricultural Products Ltd Ferhat Anwar
(Meena Bazar) Professor, IBA, University of Dhaka

All rights reserved. No part of this journal may be reproduced in any form, by print, photoprint, microfilm or any other means without written permission from the publisher.
RESEARCH IN FOCUS NBFC IN INDIA: THE CHANGING LANDSCAPE
NBFC IN INDIA: THE CHANGING LANDSCAPE
NBFCs have recorded a healthy growth of a compound
annual growth rate (CAGR) of 19% over the past few
years, comprising 13% of the total credit and expected to
reach nearly18% by 2018–19. The success of NBFCs can
be clearly attributed to their better product lines, lower
cost, wider and effective reach, strong risk management
capabilities to check and control bad debts, and better
understanding of their customer segments. Going
forward, the latent credit demand of an emerging
India will allow NBFCs to fill the gap, especially where
traditional banks have been wary to serve.
On the small and medium enterprises (SME) front,
business and professional loans seem to be on a
growth trajectory, but mortgage backed loans (loan
against property), which form a large proportion of
the SME loans, will remain muted due to the increased
competition from new entrants in the market and
traditional banks, who have been successful in capturing
and retaining the upper end of the ticket-sized bands.
Factors that contributing to the growth of
NBFCs are:
 Stress on public sector units.(PSUs)
 Latent credit demand
 Digital disruption, especially for micro, small
and medium enterprise (MSMEs) and small and
medium (SMEs)
 Increased consumption
 Distribution reach and sectors where traditional
banks do not lend.
Alternative credit scoring: The game
changer
ALL DATA IS
CREDIT DATA.
ABOUT THE RESEARCH
“NBFC in India”: The Changing Landscape is a report published
by Pricewaterhouse Coopers (PwC) which is a overview of the
trends and parameters of Indian Non-Banking Financial Sector.
4 of 40
This mantra is increasingly being followed by lenders to
use nontraditional sources of data. Different transaction-
based lending models, especially those centered on
peer-to-peer (P2P) lending are being rolled out in India
in order to allow good applicants to demonstrate their
quality. Additionally, P2P firms offer customers scope
for negotiation of interest rates, enabling borrowers to
obtain capital at a lower cost while providing investors
an opportunity to earn lucrative returns.
Indian consumer is increasingly adopting digital as a
way of daily life. India is currently the second biggest
smartphone market. To stay relevant in such an
environment, NBFCs need to rethink their strategy
to enhance their product portfolio (positioning and
pricing), processes (internal and customer facing)
and end-to-end customer experience. There are some
factors which will be a game changer in future for credit
scoring. India’s nonfinancial companies are already
using some of the factors for credit scoring of the
borrowers.
Spotlight 1: Lending based on data from
mobile phone records
First factor of game changer is lending money based on
data from mobile records. Financial intuition lending
based on data from mobile phone records. Data from
mobile phone records, prepaid top-up, mobile bill
payments and determine the creditworthiness of
underserved customers. Lenders can use the output
of their credit scoring to offer unsecured, small ticket,
short-term at a much lower cost than tradition loans.
Spotlight 2: Rise of social media scoring
Because of the explosion of e-commerce, Internet and
social media usages in India has led to the emergence
of a new breed of online lending platforms in India and
abroad that leverage social media and Internet browsing
data to assess the credit worthiness of customers. This
is another game changer for NBFC in future. Recently
Lendingkart (a Saama Capiatl and Mayfield Fund-
backed Start-up) announced a partnership with Lenddo
to explore alternative credit scoring solution based on
non-financial data sources. Lenddo is a Hong Kong
 From: First Access Mobile phone records: From: First
If you just applied
Phone calls Access
for a loan at ABC
Texts Bill pay Recommended
Bank and
Airtime top-up Mobile money business loan for
authorised your
Zulfiqar Tahari at
mobile records to
Demographic Geographic Financial Social ABC Bank: 500
be used in your
USD over 12
credit evaluation,
months. Eligible
reply 1 now. Reply 2
for instant
to deny. Reply 3 for
disbursal
more information.

Customer receives SMS First Access conducts First Access makes

Customer Loan officer from First Access If the credit assessment recommendations
applies for texts customer’s customer
requesting consent to gives based on various parameters to the loan officer via
loan at financial mobile number use phone records for consent text message
institution to First Access credit assessment

How the First Access credit scoring model works?

based company, rates borrower on repay to the loans.
The scoring is done on the basis of thousands of data
points gather from social media activity across multiple
platforms. Lenddo include number of social media
accounts which linked to the customer profile.
contributes to the overall economic steadiness and
growth of NBFIs in the economy as well mitigate
systematic risk in a large extent. But scarcity of fund,
high cost and low-cost deposit mobilization lead the
NBFIs in more comparative situation.

Spotlight 3: Assessing personality
Another game changer factor of credit scoring is
psychometric data. Number of countries are countries
are considering the inclusion of demographic and
psychometric data to help build better credit scores,
India has to catch up with existent practices of capturing
individual data which is conspicuously missing from
information sets and relevant to credit scoring.
Recent trends in funding sources for NBFCs
NBFCs have emerged as the largest net receiver of funds
from the rest of the financial system. According to the
Financial Stability Report, 2015, scheduled commercial
banks (SCBs) have the highest exposure to NBFCs
at 1,927 billion INR, followed by asset management
companies managing mutual funds (AMC-MFs) at
1,376billion INR and insurance companies at 1,064
billion INR (as of September 2015).
Funding structure is also changing from short-term
borrowings to long-term borrowings. Over the last few
years, the proportion of short-term borrowings has
been increasing since NBFCs were hesitant to lock in
long-term funding, expecting a fall in interest rates. The
trend is changing towards more long-term borrowings
as NBFCs will take advantage of the benign interest rate
environment to strengthen their liquidity profile.
NBFIs in Bangladesh:
Diversified investment sectors, long term investment
plan, more customer customized products etc.
As commercial banks faced jolt from sliding interest
rates and lower credit growth, non-bank financial
institutions (NBFIs) marked an impressive 37.94
%growth in 2016- compared to banking growth of
15.32%thanks to their innovative approaches. Industry
experts, NBFIs have become an alternative source of
financing for many entrepreneurs and integral part of
Bangladesh financial market over the year.
Leading 28 companies disbursed loans amounting
to BDT 112,483.69 million in 2016, which is 37.94
%higher than the loan disbursed by the companies in
2015, according to Bangladesh Leasing and Finance
Companies’ Association (BLFCA), the apex body of
NBFIs in operating Bangladesh. Of the total loans
of NBFIs, home loan growth was 35.45 %to BDT
33,985.16 million while the growth of auto loan was
32.45 %to BDT 7,494.32 million, SME loan at 28.38 %to
BDT 56,614.25 million, and factoring loan at 26.02 %to
BDT 11402.69%. More than 80 %of the loans disbursed
by NBFIs were term lending as their capital structure
provides better support for term financing rather than
working capital financing. NBFIs are increasingly
coming forward to provide credit facilities for meeting
the diversified demand for investment fund in the
country’s expanding economy.
Time-honored and highly standardized product design
strategy creates a vacuity for NBFIs to widen their
activities with custom design-quick adapt product
strategy; more customers oriented non-conventional
financing activities.

5 of 40
6 of 40
 The Supermarket industry
in Bangladesh got off the
ground in early 2000s.
During this timeframe,
the industry witnessed
a steady growth. Mostly
run by three key players-
Shwapno, Agora and Meena
Bazar, the industry brought
a major shift of consumers’
shopping preference from
the mom-and-pop stores to
the superstores, to a certain
extent. Not only that, it is
accountable for a larger
chunk of employment
generation- starting from
the root-level farmers to
the urban university-goer
storekeepers.

SUPERMARKETS:
NEW TREND
IN URBAN
SHOPPING
RESHAPING MODERN
RETAIL TRADE

7 of 40
 SUPERMARKETS: NEW TREND IN URBAN SHOPPING
COVER STORY RESHAPING MODERN RETAIL TRADE
Men seek convenience. Amongst all other psychological
traits of a normal human being, it is perhaps the most
common attribute that they are on the lookout for
ease and comfort. Having said that, while seeking for
comfort, they must conduct the daily chores e.g. taking
food, going to work or shopping necessaries in order
to keep themselves going. The concept of Supershopis
embedded on the theory – “Convenience in shopping
under one roof ”.
“Supershop”- why it is “super”?
“Supershop”- also acknowledged as supermarket/
superstore, is a marketplace selling a wide array of
product lines- groceries, dry foods, fish & meat,
household goods and equipment, electronic items,
clothing and so forth. Like the way the fictional
character Superman, possesses some bonus powers
than a regular human being, supershops provide some
extra perks than traditional markets. One gets the relief
from the hassle of visiting multiple stores for multiple
requirements e.g. going to kitchen market for groceries,
to wet market for raw fish and meat, to electronic
appliance store for electronic purchase and the like in
presence of nearby supershop.
World’s first Supermarket: Piggly Wiggly stores
8 of 40
The concept of Supershop: Global Perspective
 Clarence Saunders’ Piggly Wiggly stores: The
“groceterias”
Picking up a basket while grocery shopping may
seem second nature now, however, the idea was
once groundbreaking. That was far from the
only thing that changed when Piggly Wiggly, the
first modern American supermarket, opened
101 years ago. Prior to it, the Great Atlantic and
Pacific Tea Company (established in 1859) set up
small grocery stores concentrating on one aspect
of food retailing, butchers and greengrocers were
separated. It was in 1916, when Clarence Saunders’
Piggly Wiggly stores came up with self-service
shopping, which came to be known as “groceterias”
for reflecting the cafeteria-style eateries.
 The “Drive-in Market” (1930-1940)
As early at the 1920s, some chain grocers were
experimenting with consolidated (albeit still
rather small) stores that featured at least a small
selection of fresh meats and produce along with
the dry grocery items. Grocery stores started to
expand as the beginning of the “drive-in market”
phenomenon, where several complimentary food
retailers (a butcher, a baker, a
grocer, and a produce vendor,
for example) would locate
within the same small shopping
center surrounding a parking
lot. The large chains started to
consolidate their small service
stores into larger supermarkets,
often replacing as many as five
or six stores with one large, new
one. Their store count reduced
by half, however, sales were up.

Expansion to suburbs
(1950s and 1970s)
By the 1950s, the transition
to supermarkets was largely
complete, and the migration
 to suburban locations was beginning. This can be
termed as the matured phase of global supermarket
scenario with bright new stores opening on a regular
basis, generating excited and glowing newspaper
reports, and serving a significant marketplace.
After 1970, supermarket industry was quite
booming. Stores were facing the wind of change in
terms of interior, adding new product line, giving
discount offers and so forth. In 1980s to 1990s, the
middle range began to disappear, albeit slowly, as
mainline stores went more “upscale” and low end
stores moved more toward a warehouse model.
The other big trend during this time was toward
mergers and leveraged buyouts which affected
almost all the major chains.
How “Supermarket revolution” happened in Asia
and in Bangladesh?
A “supermarket revolution” in developing countries
started in the early 1990s. This revolution involves the
rapid increase of modern retail shares in food retailing
at the expense of traditional shops and wet-markets.
The diffusion of modern food retail rolled out in three
waves. The first-wave countries (in Latin America,
Central Europe, and South Africa) tended to go from
a small share of modern food retail in overall food
retail in the early 1990s to some 50% or more by the
mid-2000s. The second wave, in the mid- to late 1990s,
was in Southeast Asia (outside transition countries like
Vietnam), Central America, and Mexico. The second-
wave countries in Asia started later and reached a range
of some 30–50% share by the mid-2000s. The third
wave, in the late 1990s and 2000s, has been in China,
Vietnam, India, and Russia.
The record shows that the rapid growth observed in
the early 2000s in China, Indonesia, Malaysia, and
Thailand has continued, and the “newcomers”—
India and Vietnam—have grown even faster. Asia’s
supermarket revolution has exhibited unique pathways
of retail diffusion and procurement system change.
Several approaches are being tried to link small farmers
to supermarkets. Some are unique to Asia, for example
assembling into a “hub” or “platform” or “park” the
9 of 40
WHY INDIAN MODERN
RETAILERS HAD TO STRUGGLE
TO WIN CONSUMERS?
In 2014, India’s home-grown Supermarkets
accounted for only 2% of food and grocery sales
and were struggling to make profit. Revenues
did not keep pace with rising rents. The bet
made by the chains was that as India became
richer, its consumers would abandon kerbside
stalls and kiranas (mom-and-pop shops) for
air-conditioned stores with wide aisles and
broad ranges. Why has it not then paid off?
 In larger part, Supermarkets are not
compelling draw in terms of price and
service, in a context where most shoppers
(in India) have heavy frequency in purchase.
 The mom-and-pop stores are preferred
because they are closer to home, are usually
open longer and offer credit to familiar
customers. Many deliver free of charge.
 Supermarkets competed with clusters of
kiranas, which together can offer most of
the same products. A traditional kirana
sells confectionary, fresh eggs and poultry.
 Aisle upon aisle of global brands did not
prove such a big draw. That has forced
a rethink by some of the big grocery
retailers- which came to light in the name
of “Convenient Store” or in other words,
the limited range Supermarkets.
Mr. Kishore Biyani, the CEO of Future Group
(Big Bazaar is their food and grocery format
outlet) makes a good case for betting on
convenience stores. Turnover per square meter
is higher than in Supermarkets. Small plots
are also easier to acquire. Trent, a retail joint-
venture between Tata Sons and Tesco, reckons
there might be mileage in limited-range
Supermarkets of 450-750 square meters.
 various companies and services that link farmers to - said a retail expert. Bangladesh became the part of the
modern markets. Global Supermarket revolution in early 2000s- which is
called the fourth wave of Supermarket revolution. Key
According to Thomas Reardon, a professor at the socioeconomic changes necessary for a change in the retail
Department of Agricultural, Food and Resource environment happened in Bangladesh at a pace much
Economics at Michigan State University, Bangladesh is slower than, for example, in India. Supermarket diffusion
part of a fourth wave that just barely has emerged in is ascribed to changes like increasing urbanization,
the last few years. Other countries at a similar stage are increasing number of women working outside their
Cambodia, Bolivia and certain countries in West Africa. home (which leaves them with less time for shopping of
essentials), and increasing income per capita.
Start of Supermarket in Bangladesh
 Per capita income in Bangladesh is on rising track.
It amounted to USD 1,602 in FY 16-17, from USD
“THE ORIGINAL 1,466 in the previous FY. In 2010, it was only USD
757.
THINKING WAS, GIVE
THE CONSUMER A  The female unemployment rate dropped to
6.4%. The largest share of female employment
ROOMFUL OF CHOICE is in services and sales (30.3%). Female share of
employment as administrative and commercial
AND HE’LL CHANGE managers was 20.3% in the industry sector and
10.7% in the services sector. Overall, 12.9% female
HABITS.” share of employment is in the capacity of chief
executives.

THE SUPERMARKET TIMELINE

121 outlets
USD 200 to
USD 250 million

Agora takes Meena Bazar

over 2 outlets of buys 2 outlets of
PQS Nandan Megashop
Agora opened Meena Bazar Shwapno Annual turnover 100 outlets of
Its first outlet started its (ACI Logistics) USD 100 to 24 companies
first outlet started operation USD 125 million
Nandan Megashop
Just started
followed by Agora

2001 2002 2008 2010 2011 2012 2013 2015

10 of 40
 Storage
8 7 Transportation
6
Foodmart Market Intel
SM Agents
Bazaar
Small Retailers
Consumers 5 2
Traders
Consumers
Diagram: Indirect Sourcing
 The rising affluent middle-income slice is having
more purchasing power.
In 2001, Rahimafrooz Superstores Limited first set
up superstore in Bangladesh, namely Agora with only
four outlets. In quick succession, Agora was followed
by Nandan, initially with two large-format outlets, later
to expand; then to contract back to two; and Meena
Bazar with four medium-format outlets, by 2017 having
expanded to 18 (in 2013, Nandan sold two stores to
Meena Bazaar). In 2008, ACI Ltd. launched its own
retail chain, Shwapno (operated by the ACI Logistics
Ltd. subsidiary), with 59 outlets in By 2013, Dhaka had
roughly 40 supermarkets, including smaller ones like
Almas (4), Carrefamily (2), Pick & Pay (2) and Prince
Bazar (2). In addition to Dhaka, these supermarkets are
located in Chittagong, Sylhet, Rajshahi and Khulna.
Procurement of Raw Material
Indirect Sourcing:
When a direct sourcing chain is not maintained, as
depicted in the diagram above, several intermediaries
take a chunk of the profits, leaving a reduced amount
for the supermarket and the farmers. Typically, a 30
% margin exists between the original producer and
the end consumer. Supermarkets, via this model,
command about 10 to 12 % of this margin and farmers
get about 3 to 4 %. The rest 14 to 15 % is taken by the
intermediaries, which are about 4 to 8 in number.
Except for the bigger players, who have investment to
help them sustain, this anomaly has led to the closure
of many smaller superstores. Sharp rise in overheads –
rent, utilities, salaries and maintenance costs have also
contributed. Furthermore, the market growth is also
affected as higher prices mean a significant portion of
the middle class is remaining untapped.
Land Lease
3
1
Storage Marketplace Farmer
4
Direct Sourcing:
In case of direct sourcing model, the number of actors
in the value chain decreases to 3. This enables the
supermarkets to command a higher profit margin,
usually in the range of 12% to 18%. Naturally, it also
translates to higher return for the farmers (3 to 6 %).
The rest goes on to provide competitive prices to the
consumers.
In the direct sourcing model, the supermarkets have
to employ rural buying agents, contract farming or co-
operative models, forward purchase, transportation
risks and also deduct the suppliers’ credit. Additionally,
they also have to deal with post-harvest loss. A more
streamlined value chain, however, would mean a larger
share of the margin for both parties. Compared to India
where supermarkets command a margin of almost 30
%, Bangladesh can only entail around 12%.
Direct sourcing model is an avenue for value addition
since the model connects the small farmers to the large
retailers. Direct sourcing means higher income for
farmers and is a pathway out of poverty. The downsides
for companies sourcing from small farmers are cost and
risk. Small-farmer sourcing can be relatively expensive
if a buyer has to pay the costs of the transaction
(negotiating the quantity, quality, and price; setting up
the logistics of purchasing and payment). In addition,
small farmers may not have the capital or production
scale to consistently reach contracted quantities or
quality standards that food companies require.
In many countries, direct source is generally not a
direct transaction with the farmer. Instead, a small
array of institutions- much reduced from the traditional
market structure- operate between the farmer and the
11 of 40
 Central Storage
Foodmart
Distribution Hub
(Sorting Center)
Consumers
Diagram: Direct Sourcing
retail buyer. These actors may include NGOs, farmer
organizations, and new specialized wholesalers or
supply companies.
SWOT Analysis
Strengths:
 More players are venturing into this industry with
a robust investment in supply chain, technology
and promotional activities.
 The demand for Supermarket is soaring with
passing days as the purchase power of the middle
class slice is constantly increasing.
 Consumers are being inclined to the convenience
of shopping that Supermarkets provide.
 Supermarkets are now stepping into E-commerce
platform, which is giving consumers more
convenience and the stores more revenue.
Weaknesses
 Due to not scaling-up to the desired level,
Supermarkets have to follow the indirect sourcing
method, which ultimately increases pricing for
customers and cuts income of the farmers
 The penetration of Supermarkets outside the capital is
still low, which could be revenue generators for them
Opportunities
 The ever-growing health-conscious slice of the
consumer base is giving the Supermarkets scopes to
promote safe and organic food in a neat environment
 Rise in women employment is another big
opportunity for the Supermarkets to grab the market.
 Increasing per capita income is a bright spot for the
growth of Supermarkets
12 of 40
Transportation
1
Land Lease
Contact or Co-Op Farmer
2
Threats
 It becomes tough for the Supershops to attract
the consume base with 4% of VAT, where the wet
market doesn’t charge any VAT
 Rapid expansion in construction of commercial spaces
will make room for the Supermarkets to expand and
increase the number of outlets, which will eventually
help them to scale up and follow direct sourcing.
Supermarkets jumping on the E-commerce
bandwagon
The Supermarket chains have ventured into the
e-commerce spectrum in a bid to meet the growing
demand for convenience in shopping for perishables and
other consumer goods. On April 18 this year, leading
Supermarket chain Meena Bazar launched its online
platform, meenaclick.com. Shwapno has already rolled
out their e-store which is currently on beta testing mode.
All the products that are available in the brick-and-
mortar stores will be available on the e-store as well.
If the global trend is discerned, all the big retail chains
have shifted towards online and the move paid them
off. E-commerce is the bright sport for the giant retail
chain Wal-Mart. As statistics show in August 2017,
Wal-Mart’s e-commerce sales grew an impressive 60%
y-o-y. Wal-Mart has been making big moves in the
e-commerce space, between acquisitions, and innovative
online shopping initiatives (such as the associate delivery
program, pickup discounts etc) in order to fend off
growing competition from online retailers such as
Amazon . While Target’s e-commerce presence is strong,
it is going to take a lot of effort in order to keep up with
Wal-Mart (not to mention Amazon). Tesco moved
towards single online platform as a step towards growth.
13 of 40
MBR SURVEY
Monthly Income

Understanding consumers’ likelihood BDT 51, 000 - BDT 70,000 26%

towards a ‘Supermarket Experience’ BDT 31, 000 - BDT 50,000 22%
Supermarket industry in Bangladesh is 17 years old. Encountered with BDT 71,000 - BDT 1,00,000 19%
many obstacles like the imposition of VAT, scarcity of proper commercial
space and having a yet-to-be-robust value chain, the industry is making BDT 10,000 -BDT 30,000 14%
stride towards growth. The top -notch players have jumped on the
bandwagon to create a superior “Supermarket Experiece” for their
BDT 1,00,000 - BDT 2,00,000 10%
valued clients. More than BDT 2,00,000 9%
In a bid to be enlightened about the consumers’ take on Supermarkets,
MBR conducted a survey on 279 individuals who belong to different age
brackets, cater to variety of professions and represent all the societal- From where do you shop
class slices. We wanted to know their Supermarket experience: why they for your daily necessities
would again visit that particular shop or why they would go back to their (groceries/other
dearest mom-and-pop stores for further shopping purpose. commodities)?

28%
Age of respondent Profession of respondent Traditional
markets

46%
Small nearby
Banker 24% grocery stores
18-20 years 17%
Private Service 59%
25- 30 years 43% Government Service 4%
30- 40 years 23% Doctor 3%
Teacher 8%
40- 50 years 12% Lawyer 2%

Gender of Respondent
52%
51% 49% Supershops

FEMALE MALE

14 of 40
 Once a week 34% What products do you
Monthly 19% seek for in Supershop
most of the time?
Thrice a week 18%
Once in two weeks 11%
10%
88%
Once in two months

Daily 4% How often do you

visit Supershop? Food items (Beverages/ Frozen
Quarterly 3% Food/Dry Food and the like)
Half-yearly 1%

Which Supershop do you visit mostly?

53% 47%
Shwapno Groceries

41%
Agora

33%
Meena Bazar 18%
Cosmetics

Why don’t you prefer

Which Supershop do you visit mostly? Supershop over
traditional market?

43% 71%
They charge VAT on products whereas traditional markets don't
All the necessary products found in one platform

42% 45%
More pricey than the traditional markets
Variety of products

39% 40%
No Bargaining power in Supershop
Saves time of the customers
24% 37%
Some people have this perception that the agro products
in supershops are not fresh
Organized way of shopping

6% 10%
Habituated to shop in traditional markets
Moderate pricing compared to quality

15 of 40
 SABBIR HASAN NASIR
EXPERT OPINION EXECUTIVE DIRECTOR, SHWAPNO (ACI LOGISTICS)

BECOMING A BRAND

As part of its Supermarket Industry coverage, MBR had the opportunity for a
one-to-one conversation with Mr. Sabbir Hasan Nasir, Executive Director
Shwapno (ACI Logistics). He enlightened us with the powerful journey of
Shwapno, how it turned out to be a brand and where it wants to go down the line.

Sabbir Hasan Nasir

Executive Director, Shwapno (ACI Logistics)
MBR: The concept of Supermarket in Bangladesh was product means to a consumer, e.g. what beef means
first initiated in 2000. Shwapno (ACI Logistics) came to a consumer who doesn’t consume beef. Product
into the scenario in 2008 and now it has the highest placing thus became our concentration. At initial stage,
market share in the industry. How did it expand so well? communication and category strategy aligned.

Sabbir Hasan Nasir: Last year, Shwapno was awarded
as the “Number# 1 brand in Supermarket Industry.” In
these 9 years of action-packed journey, we have added 62
outlets in different corners of the capital and other major
divisions, and created value to thousands of individuals
in terms of generating employment for a larger chunk,
enabling the village farmers and giving our customers
a superior flavor of shopping. I took over the company
in early 2012 and the initial days were quite nailing. We
tried to understand the market, adjust
the business model accordingly and
reshape it.
Shwapno became the market leader
because we have a good understanding
of the market and the psyche of
consumers, which is cardinal. Initially
we were not doing well, during
2008-2013 we had to deal with some
drawbacks in terms of health and hygiene, product
availability, category stagey, marketing strategy and so
forth. We wanted to go for a rapid expansion and were
little baffled about brand positioning. Then we tried to
understand the value proposition of Supermarket, how
it will take shape in the next 5-10 years. At that juncture,
we set the right strategy for each category. We realized
a Supermarket should have some traffic builders, some
profit generators, some destination categories and
convenience categories. We demarcated the roles of each
category and that’s where it clicked for Shwapno and it
became market leader. By the “role of each category”,
I mean we had to have a clear sense of what a certain
Secondly, we focused on service delivery. We had a clear
understanding what group of people we are going to
serve. Are we serving the down-to-earth village class or
are they urban, picky consumer class? Are we serving
a boy who migrated to urban from a suburb? How
was his experience during shopping with his father at
childhood? How does he want to see fish? That’s why we
have kept live fish and live chicken because our endeavor
was to migrate consumers’ mind from wet market to
modern retail trade. I think Shwapno
performed really good in bringing
relevance to the industry, relevance to
customers and pricing. These are the
key ingredients for Shwapno.
2015 was a different ballgame
altogether. Like big retailers like Wal-
Mart, Tesco were capitalizing on value
creation for money, we were doing
the same too. However, our competitors started doing
the same as well. For the next level of differentiation, we
ran different campaigns like safe, carbide-free food. We
brought relevant technologies to ensure that the product
is safe. For one-notch more value creation, we added
a sub-brand “Life-style” to create a new top brand to
reinforce the mother brand.
In 2013-2014, we were the market leader, in 2016, we
became the Number# 1 brand in Supermarket spectrum.
We changed the format of stores and this new Shwapno
outfit actually drew the attention of consumers. Apart
from the mid segment, we now have all brackets of
consumers in this platform, which is amazing. In terms

16 of 40
of experience and ambiance, we are doing better than
many others of our competitions. In 2017, we got two
gold awards in communication award in across all
categories. The styling of brand is changing very fast now.
IN 2017, WE HAD ISSUES MAKING PROFIT OR
MAKING SUSTAINABILITY AND WE ALSO MADE
IT BY HAVING A POSITIVE EDITDA SINCE
JULY’17. NOW, TIME HAS COME TO REBUILD
THE WHOLE COMPANY, BRINGING A NEW
CULTURE FOR THE MILLENIALS.
MBR: Could you please share the sourcing process of
Shwapno?
Sabbir Hasan Nasir: We buy FMCG products from the
manufacturers. For fresh produce like fish and others,
50% comes from the villages and 50% comes from the
whole sale market. The sourcing of other products is
100% from suppliers. In our case, we have ACI at our
back, thus we have some connections with farmers.
From different corners of Bangladesh, we collect fish and
fruits and distribute to all outlets. We are trying really
hard to make direct sourcing into 75%- 80% and to end
this, we are thinking of new strategies since scalability is
an issue while talking about direct sourcing. Last year,
the company turnover was USD 93 million, and this year
we expect USD 120-125 million. Our CAGR in last 3-4
years has been 34%, which is well above the industry
growth rate 14%, so we are making the market. If we can
continue this growth rate with the EBITDA positive, then
we expect to scale it up to half a billion by 2021 if every
other thing and the financing go right. At the juncture,
we can have 90%- 95% direct sourcing from village.
MBR: Please tell us about the growth of Shwapno?
Sabbir Hasan Nasir: Shwapno is growing fast. As I
mentioned, our CAGR is 34% in the last 3-4 years. From
retail point of view, our gross margin is about 22%, whereas,
the same for Wal-Mart is 24%. We believe that the gross
margin will increase up to 28% because there are strategies
yet to be performed. The store-to-store CAGR varies in the
bracket of 15%- 24%. The Uttara-3, Gulshan-1, Gulshan-2
and Green Road outlets can be termed as the top revenue
generating stores. The market share of Shwapno in
Supermarket industry is 44%. We are planning to have 100
outlets in next 3, 4 years. We think that in 2021 we will be
in a breakeven position and towards to profit.
MBR: What is your strategy for store placement?
Sabbir Hasan Nasir: In early days, the stores were located
more on the neighborhoods. When I took over the
company, I changed the strategy and took the brand to
high-streets. I believe “A brand should behave like brand”.
The financial also shows that the high-street stores are
17 of 40
much profitable than the catchy-neighborhood ones.
SUPERMARKET IS NOT ABOUT MAKING COST
DOWN AND GETTING SOME CUSTOMERS
HERE AND THERE, IT IS ABOUT CREATING
PERCEPTION AND EXPERIENCE. LOOK-
AND-FEEL IS AN ESSENTIAL FEATURE FOR A
SUPERMARKET.
MBR: How do you plan for the e-commerce platform
of Shwapno?
Sabbir Hasan Nasir: We recently launched the
e-commerce site of Shwapno which is on beta testing
mode. We want to create an integrated retail experience
through both online and offline shopping by 2019. Wal-
Mart is moving very first for integrated retail experience.
This is important because according to my anticipation is
by 2030, the global online-offline ratio could be 40%- 60%
and in Bangladesh the will be 20%- 80% or 30%- 70%.
MBR: The tagline of Shwapno is –“Better shopping
with affordable price”. How do you ensure lower price
level than competitors for some of the products?
Sabbir Hasan Nasir: We value the hard-earned money
of our consumers. In some of the cases and categories,
our price level is little lower than competitors because of
scalability and direct sourcing. These are the two benefits
we try to pass on to our customers.
MBR: What initiatives you have taken so far to attract
the customers?
Sabbir Hasan Nasir: If you see the industry CAGR and
Shwapno’s CAGR, that tells you the story. We have been
very close to our customer, both in-store and off-the
store. Our BTL was very powerful. Because of the city
corporation governance, which prohibits us from using
posters, billboards; we have some different context now
and we will definitely come up with solutions to be close
with our consumers.
MBR: Could you please share the challenges
encountered throughout the journey?
Sabbir Hasan Nasir: We can’t run BTL activities properly
which is a hindrance to reach out to our customers.
Additionally, the 15% vat would be a barrier for us, it’s
good that the plan is postponed. We think this VAT policy
will be totally unfair and discriminatory. Sometimes, the
administration personnel visit the Supermarkets and
charge us without any justification. To my opinion, there
should be a central laboratory where we can take the
sample of our product and ensure the quality. Also, there
is labor scarcity. Because the employees of our stores are
mainly our students so they don’t sustain for a long time.
 SHAHEEN KHAN
EXPERT OPINION CEO, GEMCON FOOD AND AGRICULTURAL PRODUCTS LTD (MEENA BAZAR)

TALE OF GROWING STEADY

As part of its Supermarket Industry coverage, MBR had the opportunity for
a one-to-one conversation with Mr. Shaheen Khan, CE0, Gemcon Food and
Agricultural Products Ltd (Meena Bazar). He talked about the steady 15 years
journey of Meena Bazar, how it became a part of consumers’ daily life and how
he envisages the retail chain store in the years to come.

Shaheen Khan
CEO, Gemcon Food and Agricultural Products Ltd (Meena Bazar)
MBR: Meena Bazar was established in 2002, at a time profit above 20% mark once we increase the number
when the concept of Supermarket in Bangladesh of outlets which will result in better sourcing, getting
just initiated. What thoughts incited you to start the better deals and strong bargaining power.
retail chain shop?
Every day, 10000 plus customers are visiting a Meena
Shaheen Khan: After 1900, the urban Dhaka was facing
Bazar outlet for buying their necessary stuffs. This is a
a wind of change and a lot of international chains were
huge platform for new brands to promote their product
entering into Bangladesh. At that juncture, we realized
and attract the potential customer base. We offer space
that there is a quiescent demand for a platform where all
to renowned brands to shelve and sell their products
the necessities of daily life of a consumer will be under
which is also one of our revenue sources. However, the
one roof. Then the absence and need of the platform-
scope is limited since scarcity of space.
namely Supershop dawned upon to us. Simultaneously,
the Chairman of Gemcon group has a passion for
MBR: As the market trend suggests, the consumers are
healthy and organic lifestyle. Therefore, both the
inclined to shop in Supermarkets with passing days.
untapped market demand
and our CEO’s vision What are the initiatives
blended together and the taken by Meena Bazar to
upshot is –“Meenabazar”. attract the consumer base?

MBR: Currently, Meena Shaheen Khan: Meena

Bazar has 18 outlets in
Dhaka and Chittagong
division. What factors
impacted the growth of
Meena Bazar in the past years?
Shaheen Khan: If you want my opinion, Meena Bazar
could have expanded to a greater extent than it did. The
growth did not meet management expectations since
the store count was less than 50 at the eve of 15 years
celebration. However, our sales figure and the customer
base shows a remarkable growth. Also, customers are
satisfied with our products and service.
Currently, we are enjoying 20% share of the market. Our
net profit will be roughly 2%- 3% and Gross Profit is
nearly 18%. However, we are hopeful to cross the gross
Bazar concentrates on
offering the best quality
product at a reasonable price
to attract the customers. We
are the first in this industry to initiate the concept of
online Supermarket- namely “Meena Click”. One can
visit “Meena Click”, order his/her required products
and it will be delivered to his/her doorstep from the
nearest outlet within a stipulated time. We also initiated
hotline service to every outlet, where customers can
call, order their necessities and if the customer cannot
come to the store at that time, the product will be kept
at their nearest Meena Bazar outlet for them to collect
at convenient time. Through our loyalty card, customer
will get regular update of the offers and achieve points
in every purchase. Of late, we launched credit card with
Eastern Bank Limited and named it “Bazar Card”.

18 of 40
MBR: Could you please elaborate the sourcing
process of Meena Bazar? Does it follow direct/
indirect sourcing?
Shaheen Khan: We don’t follow the 100% direct
sourcing. Our sourcing process is a combination of both
direct and indirect sourcing. Since, we are yet to catch
up with the desired volume of purchase, 100% direct
sourcing is not affordable currently. For vegetables,
we follow 50% of direct sourcing and 50% of indirect
sourcing. Direct sourcing has some problems: all the best
quality vegetable doesn’t grow in a single place and the
transportation cost doesn’t allow us to source different
type of vegetable from different locations directly. We try
to collect multiple items from different sources to get the
best quality product. We also have some direct sources
where farmers cultivate product for us. We directly
collect fish from Rajshahi hatchery, which are sold at
regular basis. We are only one Supermarket don’t get the
process chicken from the supplier.
We are the only Supermarket that has its own meat
processing unit. We collect chicken/beef from the firms
and process those in our processing unit.
MBR: How the farmers are benefitted from providing
products to Meena Bazar rather to any traditional
kitchen market?
Shaheen Khan: Farmers and consumers are the greatest
beneficiary stakeholders. Farmers are getting the fair
price when we directly outsource from them. When
farmers sell their product at a traditional process, the
larger chunk of the price is eaten up by the middle men,
which increases the price of a product and consumers
bear the brunt. Farmers get the fair price when
Supermarkets directly purchase the products. Currently,
many NGOs are working with farmers to train them on
better cultivation, NGOs give us the reference and we
directly collect fresh quality products from them.
MBR: “Gourmet Bazar” is an initiative of Gemcon
Group to capture the premium slice of the consumer
base. What was the strategy behind undertaking this
initiative?
Shaheen Khan: Offering exclusive and organic food
which is rare to find in Bangladesh, was the strategy
behind initiating Gourmet Bazar. We try to make
Gourmet Bazar a destination where customers will
get exclusive, organic and healthy product. Although
Meena Bazar has a separate section for organic products
which we produce in our firm at Panchagarh, however,
Gourmet Bazar will be an international organic market.
MBR: Could you please share with us the challenges
encountered throughout the journey?
19 of 40
Shaheen Khan: VAT, government policy and lack
of commercial space are the major challenges for
Supermarket sector. VAT should be uniform for all
retailers because, this is the only attribute that makes
Supermarket less lucrative to consumers. Supermarkets
cannot go for expansion if the policy remains unchanged.
Imposition of VAT has built a negative notion in
consumers’ mind, many of them are not even aware that
perishable products don’t follow under VAT policy.
ANOTHER CHALLENGE FOR SUPERMARKET
DIFFUSION IS SCARCITY OF COMMERCIAL
PLACES IN DHAKA CITY.
Super markets cannot just rent a random place and start
running. People come to my store for having a good
shopping experience and I have to offer them that.
Supermarkets need a huge initial investment, we have
to import machineries which are quite expensive and
tax makes it even more costly. Our neighboring country
Supermarkets gained traction in terms of number of
outlets and sales only because their government took
initiatives for the betterment of the industry.
Growth of Supermarket depends on the government’s
vision about the city, if the government wants a neat and
clean and more organized city then they have to think
about restructuring and rejuvenating the Supermarket
industry and relocate the street hawkers, vendor to those
Supermarkets for an organized and planned urbanization.
MBR: What is your vision regarding Meena Bazar
down the line?
Shaheen Khan: We don’t believe in rapid growth rather,
we follow steady growth which is why we didn’t added
more outlets. We are planning for next 3-5 years. Now,
we intend to add 10 to 15 outlets within 3 to 5 years
in Dhaka, Chittagong area. We would like to keep our
promise to our customers that we always give healthy,
organic and quality products to our customers.
MBR: Please enlighten us about this sector growth.
Shaheen Khan: If we say according to the number of
outlets then we have 20% of market share. Supermarkets
growth has fall down when government added 4%
VAT on product but the demand is increasing now we
are again hopeful for an incremental growth. When
the sales fall down because of VAT then Supermarket
Owner Association decide that Supermarket will give
Vat discount they will collect 2 % of VAT from the
customers and they will subsidize 2% after a certain
period Supermarkets couldn’t afford that any more then
Association decided no more VAT discount. Rent the
space to renowned brand is one of the revenue sources
to the Supermarkets.
ENTREPRENEURS’ CORNER EXCLUSIVE SWEETS LTD.
EXCLUSIVE SWEETS LTD.
Entrepreneurial Aspirations
Exclusive Sweets Ltd. started its journey in 2006. Helal,
the owner of the shop, had a thought of starting a
sweetmeat business driven by his brother’s love for
sweets of different variety. His elder brother, who is a
doctor by profession, inspired him to start a business
rather following the traditional stream. Helal wanted to
differentiate his sweet items from the other sweetmeats
operating in the vicinity; therefore, he always ensured
the quality and made endeavors to bring variety in
types of sweets.
Product offering
Exclusive Sweets Ltd. currently offers 40 sweet items,
but no bakery item. They have their factory located
at Shaturiya, Manikgonj on a sum of 7 Katha land.
The pricing is a bit higher than that of competitors in
order to cope up with supreme quality and taste. The
price range varies between BDT 300- BDT 700/ per kg
sweets. Their signature sweet item is “Chhanar Batasha”
which is made of condensed yogurt. Also, their curd
is quite famous among the consumers. They have a
contract with a dairt farm at Manikgonj, who deliver
milk to them. Currently, Exclusive Sweets Ltd. has 4
outlets- 2 are located at Badda, 1 is at Bashundhara R/A
and another one is at Malibag. They also take corporate
20 of 40
orders for occasions and work for events like birthday
party or wedding anniversary. They kept customization
option for the customers.
Challenges
Initial days were quite tough for Helal. It requires a
substantial investment to start a sweetmeat business.
Also, it requires a suitable place to open a sweetmeat
showroom. He had his personal savings as his
investment and was looking for a partner. Also, it was
not possible to look after the business by Helal himself
alone since the factory was at Manikgonj and the
showroom was at Dhaka. After searching a lot, he found
a partner who is still working with him. After solving
the initial capital issue, Helal again faced financial crisis
to take the business to the next level. Then, he took a
bank loan to meet his requirement.
Another challenge they encountered is by setting higher
price for the sweets. Initially, they had difficulties in
attracting customers because everybody would go the
less priced once. However, since they maintain quality
and taste, they have a loyal customer base now. Also,
the flow of customers is increasing day by day by words
of mouth.
Finding human resource is another constraint in this
business. Since they need skilled people to make sweets,
they face frequent turnover of employees despite
providing them will all the facilities.
Plans down the line
Exclusive Sweets Ltd. intends to expand their business.
They are looking for space at Dhanmondi and Uttara to
start two new outlets. Finding place is another challenge
they find, since the stores have to be located on main
roads for visibility and better customer attraction.
Having discerned the increasing number of customers,
they are also contemplating on renting a factory space
for more production. Also, they plan to add a more
variety of sweets in their product offerings down the
line.
IDLC NEWS IDLC NEWS
Lywki †Lqv (Khushir Kheya)– The Happiness Market Place
What Impact can you create in one Day?
Developing communities is tough work. Especially if
you work alone. This month, IDLC launched the first
Community Service platform in the country owned
by a corporate entity, ÒLywki †LqvÓ The objective of
this platform is to engage people from all walks of life
and to inspire them to lend a hand in the development
and sustainability of our local underprivileged
communities. This online platform will allow anyone to
sign up as a volunteer and donate their time to help their
communities in different sectors like education, health,
environment and others, through events organized and
funded by IDLC.
The platform Khushir Kheya (Lywki †Lqv) is a project
which aims to bring together volunteers, stakeholders,
employees and various partners to tackle social
problems. On its launch this October, we will take
various initiatives to help improve underprivileged
communities all across Bangladesh in fields of Health,
Education, Nutrition and livelihood, and work to
preserve the Environment. To encourage the young
generation to take part in improving their communities,
we will engage youth volunteers in all of the events.
You can access the ÒLywki †LqvÓ platform here – www.idlc.com/khushirkheya
21 of 40
This project will centralize all the future CSR activities
of IDLC, carried out by all our branches across the
country.
Year after year, our employees, partners and clients
inspire and amaze us with how they come together
to make the world a better place. IDLC has created a
variety of programs to facilitate community service
and giving. And we keep looking for innovative ways
to do this, as we did in April 2017 when we celebrated
Pohela Boishakh with orphans and the underprivileged
through a festival hosted at our office premises.
Arif Khan, CEO & MD of IDLC, commented, “As
a corporate entity, we feel like it is our mandatory
responsibility to improve the communities we operate
in. And we keep looking for innovative ways to
do so. Through Khushir Kheya, we want to ensure
sustainability while encouraging involvement among
people from all walks of life to help those in need. We
believe in helping build better communities, and spread
happiness all across the country”.
 KEY
INFO
EXPORT EARNINGS DROP BY BANGLADESH MOVES TO WITHIN

10.0% TOP 100

For the first time In Global
COUNTRIES

in September’17 Competitiveness Index

IMPORT MONETARY AND

CREDIT DEVELOPMENTS
16% 16% Industrial raw materials 30%
2666.97
Intermediate goods 7% Net Foreign Assets of banking system
6% 7%
Consumer goods 16%
Others 16% 7493.79
Net Domestic Assets of banking system
15% Petroleum & petro.prodts. 6%
30% Machinery for misc. inds. 15% 1375.318
Currency outside banks
9% Capital machinery 9%
8785.442
Deposits

Monetary and credit developments as of June 2017 (in Billions of BDT)

REMITTANCE 2016-17 2015-16

1.07 Mar 1.28

1.09 Apr 1.19

1.26 May 1.21

1.21 Jun 1.46

1.11 July 1.00

1.42 Aug 1.18

22 of 40
 ECONOMY AT
PRIVATE CREDIT
GROWTH HITS
A GLANCE
58-month high at
SEEING ECONOMIC
17.84%
in August’17 TREND IN DATA
SPREAD OF LENDING LIQUIDITY POSITION OF
& DEPOSIT RATE THE SCHEDULED BANKS
0.59%

7.62%
Specialised Banks
11.09% State owned Banks
4.8 Private Banks
4.76
41.20% (Other than Islamic)
4.73 4.72
4.71 4.72 Private Banks (Islamic)
4.7
4.65 4.69
4.69 Foreign Banks
4.62
4.65 39.50%

Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17 Jul-17 Total liquid assets for December 2015 was BDT 2577.94 billion

INFLATION EXPORT

Non-Food Inflation (point to point) Food Inflation (point to point)

2% 40%
7.00%
6.19%
5.58% 5.33% 7.37% 7.51%
4.49%
6.53% 6.84% 6.95% JUTE WOVEN GARMENTS
6.89% 6.94%
5.56% 5.41% 3.30% 3.44% 3.67% 3.53%
5.10% 3.10% 3.18%
3.07%
4.30% 5.38%

43% 2% 19%

Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17 Jul-17 KNITWEAR FROZEN FOOD OTHERS
Inflation rate in July 2017 decreases as both food and non-food inflation lowers down

23 of 40
SPOTLIGHT ON STARTUP KIKSHA.COM
KIKSHA.COM
Launched in 2016, kiksha.com.com is one of the leading B2C ecommerce ventures in Bangladesh. MBR had a
one to one conversation with Zeeshan Kingshuk Huq, Co-founder & CEO of kiksha.com to get an idea about the
inception and vision of the venture.
Entrepreneur in making
Zeeshan Kingshuk Huq, the co-founder & CEO
of Kiksha.com, has a wide array of experience in
diversified arenas namely FMCG, Bank, Cement and
Telecommunication. After his stint as the Group Head
of Communication and Service Quality in BRAC Bank,
he wanted to build something of a next-game-changer.
In the year 2015, Zeeshan left job and teamed up with
Ananta Group to form Zero Gravity Ventures Limited.
Later in the same year, the E-commerce dream came
into reality: the first online B2B shop in Bangladesh –
sindabad.com.
Kiksha.com Getting off the ground
Having discerned the already competitive B2C market,
Zero Gravity wanted to start with B2B platform first.
After launching sindabad.com, he realized that while the
B2C market was competitive,
many areas of the market were
untapped and the scope of
operating in this arena is huge.
At that juncture, Zero Gravity
went ahead and in a bid to avoid
the buildup cost, they acquired
a small company called biponee.
com and eventually turned it into kiksha.com.
While acquiring biponee.com, they conducted a survey
and found that the name “Biponee” quite off-the-track
and came up with a catchy name i.e. “Kiksha.com”,
which has, by the way, no meaning at all – it was a
simple ‘proper name’ but with a ‘kick’!
Product line and Market Reach
Kiksha.com is a lifestyle e-commerce platform, having 11
product lines. The product lines cater to men, women,
kids, electronics, appliances, health and fitness, living,
stationary, flowers and gifts. Customers gets to browse
through over 50,000 products and superb selection,
place an order of the ones they choose, and get the
same delivered right at their doorsteps. Currently they
are delivering products to all over the country. Of-
24 of 40
late, kiksha.com is confidently selling even large-ticket
electronic products e.g. mobile handset, television set, air
conditioners and the like because people know the brand
and feature they know they are getting original product.
According to Zeeshan, lower price or discount is never
a sustainable strategy to capture the market because if
people have the demand for the product, then they are
ready to pay the fair amount for the product. “Our focus
is on presenting the customers with a range of quality
products, at the right price, and deliver to their delight”,
said Zeeshan.
Growth over the year
Kiksha.com has demonstrated laudable performance
over the past year. They have a growth rate ranging
between 20 % - 25% month-on-month in terms of
revenue. The number of deliveries is also shooting up
and they envisage a surge in the
quantity down the line due to
a number of factors. Currently,
they are on the closing stage of
“Series-A” fundraising.
Challenges
According to Zeeshan, like every other e-commerce
ventures, the following challenges are also applicable
for Kiksha.com.
 Unstructured supply-chain: The supply chain
for E-commerce is not strong yet. The merchants
do not have proper warehousing facility to store
the products, usually no formal or structured
inventory management. The products are not
arranged in an organized way, which results in a
greater time to deliver an order. However, kiksha.
com is working with the suppliers in a bid to come
up with solutions for better storage of products as
well as online merchant panels to better manage
their sales and inventories.
“KIKSHA.COM DOESN’T BELIEVE IN
PENETRATION PRICING”
 No concrete payment policy for online marketing
expenses: E-commerce sector doesn’t have any
fixed policy approved by government or any
regulatory body. Making payments while running
promotional activities through Facebook - is still a
concern. However, Zeeshan was optimistic as the
government is on the last stage of finalizing the
policy for E-commerce.
 Inclination towards F-commerce: Dhaka has 22
million active Facebook users, according to a statistic
published in April 2017. The soaring number of
Facebook users is making room for the F-commerce
startups to grow. However, these F-commerce
frequently fail to fulfill customer orders, which is
where customers cannot take any legal steps as the
shops do not operate within any legal framework.
After a sour experience by using F-commerce,
consumers usually hesitate to choose the electronic
platforms for their future shopping purpose.
 Funding – the biggest challenge: E-commerce in
Bangladesh is at a nascent stage of development.
Funding is a big issue since the lenders are not
fully oriented with the e-commerce ecosystem.
Banks, for instance, are subsidizing marketing and
promotional costs for credit/debit cards with the
leading apparel brands or restaurants; however,
they are not warming up to e-commerce startups.
Banks are also not adequately prepared and aligned
to finance E-commerce ventures, neither are local
venture capital firms. In E-commerce sectors,
investors have to burn their capital for over 5 years,
but in reality, everyone focuses on short term
investment. How is the India’s startup ecosystem
reaching Silicon Valley now? Because the lending
scenario in India is innovative, coming up with
new tools to promote and accelerate startups. In
Bangladesh, financial institutions must realize
the potential in e-commerce ecosystem and come
forward with convenient financial tools.
 Human Resources – the other hidden challenge:
Kiksha.com is proud of its team – the team at
Zero Gravity has a fun-filled, action-packed work-
place. But finding the right people for the right
job is difficult, and finding someone with the
entrepreneurial mindset needed at a start-up is
even more difficult. This sector needs adventurous
youngsters at the base level, and adaptive, tech-savvy
leaders at the top. Finding this right combination is
rare, and finding someone from a similar industry
with necessary skill-sets is even rarer!
25 of 40
Zeeshan Kingshuk Huq
Co-founder & CEO
Kiksha.com
How kiksha.com envisages itself in the next few years?
Kiksha.com intends to be “an amazing destination for
shopping” in the next few years. To achieve this vision,
they are adding more product lines, more exclusive
brands and will undertake more effective promotional
tools to pull customers towards e-commerce shopping.
Another major area of concentration would be in
logistics service. At present, it takes up to 4 days to
deliver an order in any place across the country;
however they are working on minimizing this delivery
time to 1 day.
How E-commerce will evolve in near future?
As Zeeshan perceives, E-commerce is a very large yet
small focused market. Bangladeshi people are adaptive
by nature. Around 98% online shopping is based on
Facebook, therefore, scopes are abundant. Earlier, the
average ticket size of E-commerce shopping was BDT
500-600, which turned to a bigger amount of over 1,000
for most other E-commerce shops and over 2,500 for
kiksha.com since now people are buying electronic
appliances from E-commerce platforms.
Kiksha.com always came up with exciting offers aligned
to customer convenience. They introduced EMI
facilities at first and also iPhone7 in the e-commerce
platform and also has launched iPhone 8. They believe
in continuing to amaze the customers. E-commerce is
going to be the next game changer and those who invest
in this platform now, will reap the benefit when the
industry gets matured.
YOUTH LEADERSHIP INDEPENDENT MARKETERS’ ASSOCIATION (IMA)
INDEPENDENT MARKETERS’
ASSOCIATION (IMA)
Independent Marketers’ Association (IMA)is the premier marketing club in Independent University, Bangladesh
(IUB) which is dedicated to youth development, and youth empowerment by means of various informative and
challenging events, seminars and workshops. MBR recently had an opportunity to have a one-to-one conversation
with Abul Khayer Jyote, the coordinator of IMA.
MBR: Tell us about the start of this club
IMA: It hasn’t been long since IMA has commenced its
journey on the vision it sees. It rings a bell, last year, on
the month of August, how interestingly the idea popped
up into our Club Coordinator Abul Khair Jyote’s mind,
and now that it’s a full-fledged club. The major purpose
behind the formation of this club was to ensure that
the students are consistently engaged with all activities
related to Marketing, and today’s business world, which
by the way, has indeed proven to be productive and
worthy. The inauguration was held along with Prof.
Sarwar Uddin Ahmed, Dean, School of Business.
Although IMA started with just a handful people
working on it, but today, it has successfully enrolled
400+ active members, who are responsible behind the
consistent growth of this club.
IMA, as the name says it all, is concentrated on the
branches of Marketing. It deals with ideas, creativity and
communication. Why is it important? IMA believes that
it can serve the students in a way, where there is a room
for the students to maximize their potentials and work
on self-development. In this era, the corporate world is
no more a walk in the park. It requires hard-work, self-
driven and committed people to survive and sustain
in the business/corporate world today. We inculcate
the corporate flavor in our students, which will guide
them to ace in whatever field they work in their career
progression, it may not be marketing. We believe IMA
is the platform where the students can allow themselves
to enhance their credibility.
MBR: Briefly share the club activities (competitions,
workshops, seminars) and club achievements.
IMA: IMA actively focuses on activities such as
workshops, seminars and business competitions
26 of 40
for the students and club members specifically. To
mention few, IMA has worked with Brand Forum
Bangladesh, in the happening of a renowned IDEA
Competition, knows as Youth Fest 2017. The active
members of IMA have volunteered, participated in the
event. Also, two of the active members of IMA, Sabbir
Ahmed and Imran Khan, both majoring in Marketing,
have earned the divisional champion award in the Idea
Competition.
Moreover, IMA club members always get the first
invitation when it comes to different seminars and
workshop arranged by itself and other prominent
organizations like Brand Forum Bangladesh. Among
the plenty of achievements, one that is the most
successful thing that IMA organizes, is the Marketing
Carnival in IUB. Abul Khair Jyote, Club Coordinator
of IMA, has never failed to impress the students
through organizing this carnival event.
Carnival Event is a real-life and practical example of
Marketing experience for the students and everyone
else attending the event. The carnival deals with selling
products in stalls, promoting and learning consumer
behavior, which in Marketing, is significantly essential.
Students set up the stalls to exhibit their products,
communicate and convince people to try out their
products in an attempt for sale and negotiate the pricing
of products. The day-long event ends with electrifying
concerts.The purpose of all these activities is to keep
the students motivated and consistent in terms of
not only theoretical knowledge but also practical or
real-life scenario. We believe that Marketing has a
lot to do with hands-on experience. Only theoretical
knowledge will not make somebody a good marketing
professional. Hence, we prepare our students during
the early stage of their undergraduation so that they
can get a glimpse of the true corporate life.
Since the club is just one year old, it is too short a time
to achieve something big. However, the way we are
preparing out students, they will indeed ace in whatever
field they work.
MBR: Briefly describe your recruitment process.
What qualities do you look for in potential members?
IMA: Recruitment for IMA members are held every
semester. IMA maintains the standard recruitment
process and because of that, despite getting innumerable
applications every time, it chooses very few. Students go
through a registration process and an application fill-
up process. Then they get called up for the interview
where IMA coordinator Abul Khair Jyote himself takes
the interview. The prime criterion to be a member of
this club is to have a major/minor in Marketing and
he/she must be a student of Independent University,
Bangladesh. The qualities IMA looks for within
the students are being self-driven, committed and
spontaneous. If a student possesses these qualities, their
skills can be honed to a standard level when they will be
prepared to join the corporate.
MBR: What challenges do you face? How do you
overcome them?
IMA: Almost all the events and activities by IMA
requires huge amount of time, effort and commitment.
Some challenges are inevitable, and only can be
overcome by people who are determined and well-
27 of 40
wisher for the club. It’s a great thing that IMA has a
team who are full of potentials and possesses leadership
quality which profoundly helped IMA to overcome any
obstacles it faced through organizing massive events
like Marketing Carnival.
MBR: How do you want to see your members down
the line once they get in the professional world?
IMA: IMA believes that it has the ability to transform
and shape up each and every individual engaged with
the club. Through various tasks, responsibilities, the
club members too believe that they have maximized
their potentials by achieving the goals of the club.
Prior than anything, IMA envisages its members to be
a better human being and then a better professional.
It is needless to mention how this will put an impact
down the line once they in the professional world
and they will undoubtedly be the gold fish among the
plenty of fish in the sea. We believe in our students
and are hopeful that they will carry the legacy of the
club wherever and in what capacity they work in
future.
MBR: What are the club’s plans for the future?
IMA: There is no end to improvement. The club’s future
plan would be to create a sustainable platform for the
marketing students where they can allow themselves to
work on self-development create possibilities not only
locally but globally.
 DR. SYED FERHAT ANWAR
TRAILBLAZERS PROFESSOR, IBA, UNIVERSITY OF DHAKA
Changing places, changing culture
Dr. Syed Ferhat Anwar is the only child of his parents.
His father was an army professional who worked in the
capacity of a doctor. His father was transferred to many
positions from rural to urban, aligned to his nature
of profession. As a result, Ferhat also had to travel a
lot in his childhood, changing a number of schools.
They did not hold on to a place for long, for which
he barely developed friends. With changing territory
and versatility in culture, Ferhat had developed a lot
more experience than that of a traditional kid. As he
perceives, travelling to places served him in ambivalent
ways. From his early childhood, he was involved and
interested in extra curriculum activities more than
studies. Due to the quick transfers of his father one after
another and the magnitude of cultural shifts, he learnt
to deal with challenges and to grow different mindsets
on a certain something. That was the time, the seed of
innovation was inculcated in him.
In teeth of adversities
Prior the liberation war, SSC examination was taken
into parts, one in class 9 and the last one in class
10.Ferhatattended his Part 1 exam in Dhaka with
28 of 40
Dr. Syed Ferhat Anwar
Professor, IBA, University of Dhaka
Science as core discipline. At that time, his father was in
Karachi. Right after the exam, the liberation started. He
fought for his homeland and he was the Prisoner of War
(POW) in his camp which was in Loraly hills. This place
is 8000 feet above from the sea level. At that juncture,
he and some of his friends got permission to sit for
the second part of SSC examination in the camp. He
was notified that he was given permission to sit for the
exam before 18 days of the final exam. There were 11
candidates and and only one stack book were given for
the 11 candidates. Since, there was no lab in the camp,
he had to take Arts as his HSC discipline. He was in the
camp for 3 years as a prisoner of war and after that, he
and his family back to Bangladesh.
Arts instilled the foundation of human values in him.
He felt that any work/studies that is dedicated to a
greater human cause can make much difference and
add some real value to the world. In his progression in
career, he always adhered to these human values.
Next step towards education
Barely anybody could beat the unique combination of
Science and Arts as disciplines in SSC and HSC of Dr. Syed
Ferhat Anwar. The human values of Arts touched him and
created an interest in him to study Arts further. However,
his family trend ran counter to his interest and he was
asked to build his profession in medical. Ferhat grew a
discomfort for medical after witnessing the bloodshed
war; therefore, he decided he would not go for it.
AT THE END, THE
EXPECTED HAPPENED
WHEN A YOUNG GUY
WANTS TO STUDY
PSYCHOLOGY AND
IS FORCED TO STUDY
MEDICAL: HE ENDED UP
AT THE BIOCHEMISTRY
LAB.
He got admission in the Department of Biochemistry in
University of Dhaka.
A life-turning accident
Ferhat was passing an enjoyable time in the
Biochemistry Lab. One day he and his two friends were
working in the lab and wrapping up. One of his friends
was washing glass wares and she didn’t notice that there
was sodium in one bottle. Naturally, when sodium
and water mixed, it burst and she got tremendously
injured and started bleeding a lot. They both took her
to the hospital and later, she started recovering. That
night, Ferhat returned home all blood-drenched and
his mother opened the door. Being the only child of
his parents, Ferhat was immediately asked to shift his
career path from Biochemistry to something safer in
order to avoid such bloodshed.
Interestingly, at that juncture he took an admission test
for MBA in IBA out of peer pressure. He and his 5 other
friends attended the test. With no preparation, he passed
it with flying colors and the other 5 couldn’t make it
there. Meanwhile, his mother was also pushing him to
shift to any other discipline other than Biochemistry.
That is how the chapter of IBA begins.
Start of Professional Career
Although he joined the MBA program in IBA, he
kept working on Biochemistry Lab since, by then, he
29 of 40
already had his first international publication. He is
the only person who had the opportunity to complete
thesis on two disciplines: Biochemistry and Pharmacy.
In 1982, he joined BRAC as a Staff Economist. At the
first week, Dr. Abed asked him to visit Sunamgonj to
see the activities of BRAC. He was moved with the
humanitarian objective of BRAC. He could connect the
human values of Arts with his job, which made him feel
attached to his responsibility.
During BRAC tenure, Ferhat developed many projects
for BRAC. He laid off the initial phase of Aarong and
BRAC Export. He always had this knack for innovation,
hence loved to come up with new ideas and implement
those.
Brac created a new perception about the business world
to him and as he remarks about his brac experience,
“My learning from brac, i will never forget, they create
my human values.”
After 5 years of service in BRAC, he left the organization
and got an offer from Beximco Pharmaceuticals Ltd.
On the same say, he got a call from IBA and they offered
him the position of lecturer. Most of Ferhat’s life events
happened by chance, not that he planned for any. He
decided that he would grab the offer who would call
him first. Thus, upon getting the call from IBA before
Beximco, he joined there as a faculty member.
Teaching icons
When Ferhat was a MBA student in IBA, he did not
like the Marketing course since his background was
in Science and he was skilled in quantitative subjects
like Finance. Dr. Zahid Hussain, Lead Economist,
The World Bank taught him finance. Zahid Hussain’s
teaching style always inspired him to connect to his
students in a non-conventional manner. Another
person who had quite an influence on his teaching style
is Dr. Saad Andalib, Vice Chancellor, BRAC University.
The first course taken by him was Finance. Later on, he
taught Accounting, Law and then he started teaching
the core courses of Marketing.
Challenges
Ferhat does not believe that he encountered massive
challenges in life. However, it’s not possible for an
aspiring man without challenges. In 1990, he had
a major accident where he lost his eyesight. It took
him 3 years to regain the eyesight of one eye and he
has a partial eyesight for 15 years. However, it did not
intimidate him in any way. He faced discrimination
due to his eyesight when he was about to be promoted
as Assistant Professor from Lecturer. One of his class-
mate cum student told the board that as he doesn’t need
promotion since he has a short eyesight and there was
huge competition and limited amount of seat.
Dr. Syed Ferhat Anwar did not bother what people
had remarks about him. That particular statement
pushed him to strive more and more and he worked
tremendously hard to prove his worth. He performed
very well and lastly, he was promoted to Assistant
Professor.
Marketing practices in Bangladesh
Being a true marketing professional, Dr. Syed Ferhat
Anwar has a wide array of knowledge in market
research. His opinion regarding the marketing practices
of Bangladesh goes like this: the companies have been
following the multinational practices. They hardly try to
innovate and come up with their own tools, which may
hit the target market. Every organization has different
strengths, weaknesses, and different target segments.
Organizations who tried to understand the local market
and came up with their innovative marketing tools,
eventually aced in the businesses. Square and Beximco
Pharmaceuticals are cases in point. The pharmaceutical
industry is doing extremely good in marketing which
is reflected their financial performance. Square and
Beximco made its place in the top 10 multinational
companies.
The startups are doing very well too. They are coming
up with different business models with innovative ideas.
The RMG sector is mainly production based where they
have limited scope of innovation. But they also did quite
well after the Rana Plaza incident in 2011. Amongst
the Top 10 green factories, majorities are Bangladeshi.
Bangladeshis have proved that they are very innovative,
they can work under challenges and can perform better
than others. Now we are not only focusing on finance
or profit only, we are working in those areas which have
something to do with human values to a greater extent.
Bangladeshi companies are becoming multinational.
That’s a new trends we are witnessing now-a-days and
it is all because we are touching human lives in some or
other aspects.
30 of 40
Advice to the young professionals
• Every person is born with a purpose and the
purpose is unique. Your job is to find the
purpose and work on it. At the same time,
also remember that your purpose should
not be confined to you only. While fulfilling
it, you must see what you are doing for the
greater cause.
• Believe in teamwork, both in university
assignments and in real life. If you help
someone in a particular task, you will always
get him/her bny your side in your bad times.
• Never say no. Young generation should try
hard and soul to achieve their goals. They
should not give up their hopes and give in to
the complexities. Failure is a part of life. You
must master the art of tackling it and make
your venture successful.
• Don’t do too many things at one time. Try to
identify your strength because your strength
will offset your weakness. Look within you.
You must have some unique trait that can
take you to heights. If people help follow
others than they never can success in their
life. You can be selfish. Selfish is not bad
thing, however, self-centered is harmful.
Happiest Recreation
DR. SYED FERHAT
ANWAR’S HAPPIEST
RECREATION IS HIS
FAMILY.
He loves to travel and till date he travelled to more than
20 countries. Having a diversified childhood, he has this
knack of coming up with innovative ideas. He has been
intrinsically involved with the education system: served
as the Pro-Vice Chancellor of East West University.
Currently, he is working on a project to bring foreign-
quality education in Bangladesh with a Malaysian
University. He strongly believes that people have to be
people-oriented.
31 of 40
INDUSTRY

UPDATE
AGENT BANKING ACCOUNTS NUMBER OF AGENT BANKING
WITNESS INCREASE OF 60.18% ACCOUNTS
About 3.3 lakh agent
AGENT BANKING banking accounts were
opened in the first half of 2017, which is an
1000000
increase of 60.18%. Of the 17 licensed banks for 872865
900000
agent banking, 12 are already running their own
agent banking operations. Dutch-Bangla Bank 800000 712499
Limited is the market leader with its 1,454 agent 700000
outlets and 5.75 lakh agent banking accounts. 544536
600000
The Central Bank has decided to agent banking to
500000
reach the poor segment of the society and existing
bank customers with a range of financial services, 400000

especially to geographically dispersed locations. 300000

Bangladesh Bank has bumped up the daily cash
200000
deposit limit for agent banking accounts to BDT 6
100000
lakh from 1 lakh and the cash withdrawal limit for
business accounts has been set at BDT 5 lakh and 0

fund transfer limit BDT 15 lakh. Dec '16 Mar' 17 Jun'17

RMG
RMG EXPORT SHINES STRONG IN
EURO

According to the latest Export Promotion Bureau

(EPB) data, Germany has overtaken the US to become
Bangladesh’s largest RMG export market in the July-August
period of the current fiscal year. Bangladesh’s readymade
garment export to its major destinations including the
European countries, United States and Canada achieved
significant growth in the first two months of FY 2017-18.
However, the export earnings from the Asian countries
including Japan, China and India declined in the period.
Experts and exporters say the growth trend is satisfactory
and Bangladesh is getting benefits of recent rebound of
the euro against the dollar. RMG export to Germany in
the first two months grew by 9.72% to USD 992.39 million
from USD 904.46 million in the same period of the FY17.

32 of 40
LPG MARKET BOOMING
WITHOUT REGULATIONS

Consumption of Liquefied
POWER Petroleum Gas (LPG) has been
increasing at a faster pace since 2013 with
growing allegations of charging higher prices and
supplying the cooking gas without maintaining
quality and quantity. Ban on providing new gas
connections to households since 2013, price fall
and rise of consciousness among eligible people
about hazardous arrangements of daily cooking
are the major reasons for the booming market,
said officials.Last year, the annual consumption
exceeded 4, 00,000 tonnes of LPG, which was less
than 1, 00,000 tonnes until 2013. Bangladesh has
40 million households and commercial units that
require cooking gas and of them, demand from only
3.7 million is met by supplying natural gas through
pipelines. However, absence of regulations in the
sector was creating dissatisfaction among the
consumers.

LISTED CEMENT COMPANIES’S CEMENT

EARNING IN Q1
10.3
CEMENT INDUSTRY SHOW MIXED
EARNINGS GROWTH
Listed cement companies showed mixed
performance in earnings for January-March period of
2017. Currently, seven cement manufacturers are listed
6.3
with the Dhaka Stock Exchange (DSE), accounting
for about 4.50% of the total market capitalization.
Overall demand of the key construction materials
4.0
3.7 is increasing, following the on-going construction
3.4 3.2
of various development projects including Padma
2.1 Bridge and rise in the number of roads and other
1.8 1.8
1.3 infrastructure projects in rural and sub-urban areas.
0.4 0.7 About 45 cement manufacturers are in operation in
0.3 0.3
the country. Heidelberg, Holcim and Lafarge are the
Aramit ConfidenceHeidelberg Lafarge Meghna MI Cement Premier leaders among multinational cement makers while
Cement Cement Cement Surma Cement Cement
Shah Cement and Meghna Cement are the leading
EPS of Jan-Mar 2017 (BDT) EPS of Jan-Mar 2016 (BDT) domestic manufacturers.

33 of 40
 MONTH IN BRIEF

Japanese Locally assembled Payment

companies Trade handsets to hit market
through mobile
show interest in next year (Walton

investment
deficit plans to assemble 50 banking accounts
lakh and symphony
in increased assemble 60 lakh sets
soared to

Bangladesh by 347.45% in a year) BDT 100

for cheaper to USD 1.05 billion in crore in
production July
July

Balance of Payments
In millions of USD 378
480 Bangladesh’s Government
balance of resumes borrowing
Trade Balance from banks to meet
payments entered
budget deficit
-178
the negative
-236
Overall Balance territory for the
-497
Current account
Balance
first time in16
-1056 years in July
July FY17 July FY18

Source :Bangladesh Bank

The Asian Government Foreign • The National

Development exchange earnings Board of Revenue
to stock up on (NBR) plans to set
Bank (ADB) and from pharmaceutical
government signed
loan agreements
900,000 exports jumped to
USD 89.17 million,
up new tax zones
in Jessore and
worth tons of rice by a sharp rise of 8.6% Kushtia
USD 200 November from the previous
year’s export
million to
earning
strengthen
urban
infrastructure

34 of 40
 MONTH IN BRIEF

Global Competitiveness Ranking (Bangladesh) Bangladesh

99
106 107 109 110 108
118

ship building NBR

industry earns to freeze
USD 150 million
in 5 years luxury
2016 2015 2014 2013 2012 2011 2010 hotel bank
Bangladesh moved 7 notches up accounts
on global competitiveness index and
secured its position within the first
for tax
100 countries evasion

Non-performing Revenue from Bangladesh’s The agriculture

Loans (NPLs) land ports rises employment loans disbursement
jumped by over growth almost grew by 35.46% in
20.44% in halved in 2010- the first two months
19% to fiscal year 2016-17 2016 compared of the current FY

BDT 119.76 to the preceding

period since 2003:
billion at the The World Bank
end of June’17

Sales of Savings Tools The The The estimated

(In BDT Lac)
government government is cost of Padma
FY17 0.75
plans to Multipurpose
introduce
set to borrow Bridge Project
FY16 0.54
two different BDT 10 billion may rise for the
FY15 0.43 interest rates on through issuing third time by
savings tools Bangladesh around BDT
FY14 0.24
(in BDT Lac) Government
and considering 14.0 billion
FY13 0.23
to lower the
Treasury Bonds
FY12 0.19 interest rate (BGTBs) to
on savings meet budget
FY11 0.17 certificates deficit partly

35 of 40
 For the Record

‘INDIA’S BAN Bangladesh’s economy is

expected to grow at 6.9 in the

ON RICE current fiscal year (FY18) while

the inflation will remain within 6%,

EXPORT WILL according to latest report of the

Asian Development Bank (ADB).

NOT HAVE ANY

IMPACT’. “We have to
TOFAIL AHMED, Commerce Minister on the initiative
of Indian government decided to stop exporting rice to
wait up to
Bangladesh from September 15 to November 30.
November-
Besides, The banks December
remittance may raise to get a total
inflow their interest picture of
through rates on
illegal lending to
the country’s
channels minimize export
will be their cost of earning
reduced funds. trend”.
and ALI REZA IFTEKHAR,
Managing Director (MD)
MD SIDDIQUR RAHMAN, Bangladesh
freelancers’ and Chief Executive Officer
(CEO) of Eastern Bank
Garment Manufacturers and Exporters
Association (BGMEA) on the fall of export
work
Limited on rising deposit
earning to 9.83% in September’17
rates in banks

volume will
increase MANY COUNTRIES IN THE WORLD
HAVE IMPOSED LIMITS ON CASH
ICT expert Mustafa
Jabbar on PayPal’s TRANSACTIONS.
introduction in ABU HENA MD RAZEE HASSAN, DEPUTY GOVERNOR, BANGLADESH
Bangladesh from BANK on Government’s would-be initiative to put caps on cash transactions
October 19 to curb illegal money flow

36 of 40
ANALYTICS
SEEING
TRENDS
IN THE
DATA

THE WAY WE WORK NOW In 2012, the central bank approved 9 more banks in addition to
existing 47 commercial banks in Bangladesh. These are: NRB Bank
AN EVALUATION OF THE Limited, NRB Commercial Bank Limited, and NRB Global Bank
PERFORMANCE OF NEW Limited, Union Bank Limited, Modhumoti Bank Limited, Farmers

COMMERCIAL BANKS BankLimited, Meghna Bank Limited, Midland Bank Limited and South
Bangla Agriculture & Commerce Bank Limited. The report shows a
comparative performance analysis of the nine banks in terms of their
operating efficiency, NPL and profit.

Operating Profit to Total Assets Return on Assets (ROA) 2013 2014 2015 2016

3.2%
7%
7%

6%
6%

6%
6%
6%

6%

2.1%

2.1%
2.0%
5%
5%

5%

5%
5%

5%

1.9%
1.9%

1.8%
1.8%
4%
1.6%
4%
4%
4%

4%
4%

4%
4%
4%

4%
4%

1.5%

1.4%
1.2%
3%
3%

3%

3%

3%

1.0%
1.0%
0.9%

0.8%
0.7%

0.6%
0.5%

0.5%
2%

2%
2%

0.5%
0.4%

0.4%
0.3%

0.3%
0.3%
0.2%

0.2%
0.2%

0.2%
0.1%
0.1%
0.1%

NBR NRB NRB Modhumoti Meghna Midland SBAC Union FBL

-01%

Commercial Global
NBR NRB NRB Modhumoti Meghna Midland SBAC Union FBL
-0.4%

Commercial Global
-0.5%

Return on Equity (ROE) Non-Performing Loan to Total Advances

4.0
16.9%
15.2%

14.1%
13.8%

12.4%
11.2%
11.0%
10.4%

9.6%
9.5%
9.2%

8.5%

1.9
8.1%

7.3%
6.3%

1.5
5.3%

5.0%
4.9%

1.0
1.0

0.7
2.4%

0.6
0.5
1.9%
1.9%

1.6%

0.4
1.2%

0.9%
1.1%
0.9%

0.8%
0.7%

0.3
0.2

0.3
0.5%

0.5%
0.3%

0.3%

0.3%
-0.3%

0.0

0.1

0.1
0.0

0.0

0.0

NBR NRB NRB Modhumoti Meghna Midland SBAC Union FBL NBR NRB NRB Modhumoti Meghna Midland SBAC Union FBL
Commercial Global Commercial Global
-1.8%
-1.7%

ABOUT THE RESEARCH

A research workshop on “An Evaluation of the Performance of New
Commercial Banks” conducted by Bangladesh Institute of Bank Management
(BIBM), illustrates the performance of 9 new commercial banks in Bangladesh.
commercial banks. Team members include Mohammed Sohail Mustafa CFA,
Tanweer Mehdee, Md. Masudul Hogue, Md. Abdul Halim.

37 of 40
CAPITAL MARKET REVIEW MONTHLY MARKET STATISTICS

Monthly Commentary l
After reaching the 6,000.0 points’ benchmark in
August, 2017, DSEX stayed afloat over that level in
September. By the mid-September, DSEX climbed
234.1 (+3.9%) points and created its all-time high
of 6,240.6 points. Moving forward some natural
correction took place, which lasted throughout
the month. In the end, DSEX closed the month
at 6,092.8 points, netting an 86.4 (+1.4%) points
gain. Blue-chip index DS30 also followed similar
pattern of topping out at middle and correcting
thereon. DS30 closed the month 1.8% higher than
the close of the previous month.
Bank remained to be the center of all activities
and top gainer in this month as well. The sector
posted 6.7% gain in September. RUPALIBANK
(+28.1%), SIBL (+21.0%), SHAHJABANK
(+19.6%) and PREMIERBANK (+19.3%) shined
the brightest among all the banks. Overall, 40.8%
of the month’s total turnover centered on Banks.
Telecommunication sector also supplemented the
market gain, advancing by 6.4%, as the largest
market capitalization stock GP went up by 6.6%.
Meanwhile, Engineering sector was the worst loser
among the major sectors, falling by 5.3%. Textile
also declined sharply, by 5.1%.
Investors’ participation level in the market was
very encouraging. Total daily turnover averaged to
be BDT 10.5 bn. However, turnover level declined
in the later part of the month, as market was in the
correction phase.
Meanwhile, MSCI Frontier market index increased
by 1.8% this month. Among the regional peers,
Pakistan and Vietnam outperformed Bangladesh;
increasing by 2.9% and 2.8% respectively
compared to 1.4% advancement of DSEX

Monthly Market Statistics l

Index Movement

Indices Index Point, Sep 2017 1M Return 3M Return YTD Return 3Y Return

Bangladesh

DSEX 6,092.8 1.4% 7.7% 21.0% 20.1%

DS30 2,177.6 1.8% 4.5% 20.2% 11.1%

DSES 1,345.9 1.8% 3.8% 12.9% 12.6%

Peer Countries
Pakistan (KSE 100) 42,409.3 2.9% -8.9% -11.3% 42.7%
Sri Lanka (CSE - All Share) 6,438.2 0.7% -4.6% 3.4% -11.2%
Vietnam (VNI) 804.4 2.8% 3.6% 21.0% 34.3%
563.7 0.4% 4.9% 12.9% -18.7%

MSCI Frontier Markets Index 605.1 1.8% 7.4% 21.2% -13.6%

All returns are Holding Period Return

Market Statistics (September, 2017) Graph: DSE Turnover and DSEX

Market Statistics 28-Sep-17 31-Aug-17 % change

Mcap All (USD mn) 50,472.0 49,837.7 1.3%

Mcap Equity (USD mn) 43,056.5 42,421.6 1.5%

Daily Avg. Turnover (USD mn) 130.1 115.6 12.5%

38 of 40
Top Twenty Market Cap (September, 2017)
Daily Avg. Turnover
DSE Code Sector Mcap1 (USD Mn) 1M Return 3M Return YTD Return 3Y Return
(USD Mn)

GP Telecommunication 6,950.7 2.0 6.6% 20.6% 50.4% 23.2%

SQURPHARMA Pharmaceuticals & chemicals 2,601.6 2.3 7.0% 5.5% 22.8% 49.1%

BATBC Food & Allied 2,225.7 0.6 -0.4% 5.8% 23.5% 13.3%

ICB NBFI 1,403.2 0.4 -0.7% 2.4% 71.2% 37.9%

BRACBANK Bank 909.1 1.1 0.1% 6.4% 62.6% 261.2%

LAFSURCEML Cement 882.4 1.4 4.3% -2.5% -24.8% -53.8%

RENATA Pharmaceuticals & chemicals 879.3 0.1 2.2% 0.7% 7.7% 70.2%

UPGDCL2 Fuel & Power 749.5 0.3 -4.4% -9.9% 17.7% N/A

ISLAMIBANK Bank 688.5 1.1 4.5% 7.1% 19.7% 55.1%

OLYMPIC Food & Allied 673.3 0.2 -0.7% -2.4% -11.8% 92.9%

BERGERPBL Miscellaneous 604.0 0.0 1.2% 0.1% -6.8% 103.3%

TITASGAS Fuel & Power 583.6 0.3 -3.3% -5.9% -3.6% -39.8%

BXPHARMA Pharmaceuticals & chemicals 536.9 0.8 -1.5% -5.5% 32.2% 74.7%

SUMITPOWER Fuel & Power 521.5 2.0 1.4% 3.9% 14.6% 22.0%

CITYBANK Bank 496.1 2.6 3.9% 22.2% 80.3% 220.6%

MJLBD Fuel & Power 446.1 1.1 -3.0% -1.8% -0.3% 6.0%

NBL Bank 440.7 4.0 16.3% 29.3% 76.5% 88.2%

MARICO Pharmaceuticals & chemicals 436.6 0.1 8.7% 9.4% 21.7% 9.0%

EBL Bank 415.3 0.5 0.9% 29.7% 74.7% 127.0%

IDLC NBFI 402.4 1.0 -0.2% 21.6% 58.0% 108.9%

All returns are holding period return

Mcap as on last trading session of the month
1

2
3Y return of UPGDCL is unavailable as it was listed in 2015

Top Ten Gainers’ List (September, 2017) Top Ten Losers’ List (September, 2017)
DSE Code 28-Sep-17 31-Aug-17 % Change DSE Code 31-Aug-17 31-Jul-17 % Change

MERCINS 26.8 20.7 29% RSRMSTEEL* 61.2 79.8 -23%

RUPALIBANK 71.2 55.6 28% KAY&QUE 123.7 158.8 -22%

PROVATIINS 24.0 18.9 27% ZAHEENSPIN* 20.7 26.3 -21%

ILFSL 21.5 17.7 21% RNSPIN 18.0 22.4 -20%

SIBL 31.7 26.2 21% FINEFOODS 40.2 48.7 -17%

SHAHJABANK 26.8 22.4 20% MEGCONMILK 14.8 17.7 -16%
FIRSTSBANK 17.2 14.4 19% FUWANGCER 19.2 22.9 -16%
PREMIERBAN 17.3 14.5 19% PENINSULA 25.8 30.5 -15%
MIDASFIN 36.2 30.5 19% SAMATALETH 53.7 63.4 -15%
UTTARABANK 38.1 32.6 17% SAVAREFR 82.6 96.7 -15%
*Represents post record date adjustment

39 of 40
Top Ten Closed End Funds based on 5 years’ (CAGR) performance:
"Price1 "NAV1 "Price/ "Dividend 2 NAV Return3 "Redemption
DSE Code Fund Manager
(BDT)" (BDT)" NAV" Yield (%)" Year"
2017 YTD 2016 2014-16 2012-16
NLI1STMF VIPB 15.0 15.98 93.9% 10.0% 22.6% 20.0% 17.7% 15.7% 2023
SEBL1STMF VIPB 14.0 14.99 93.4% 9.6% 22.3% 19.3% 16.5% 14.2% 2021
GRAMEENS2 AIMS 14.9 19.31 77.2% 7.4% 20.0% 15.1% 13.6% 12.1% 2021
RELIANCE1 AIMS 10.8 15.09 71.6% 9.3% 18.9% 17.1% 10.7% 11.8% 2027
IFILISLMF1 ICB AMCL 8.3 10.25 81.0% 10.8% 16.1% 14.0% 12.9% 11.0% 2023
1JANATAMF RACE 7.0 11.95 58.6% 2.9% 19.3% 6.5% 12.2% 9.8% 2020
ABB1STMF RACE 7.0 12.49 56.0% 4.3% 19.7% 8.9% 9.9% 9.8% 2019
FBFIF RACE 6.5 12.02 54.1% 3.1% 17.5% 9.1% 9.3% 8.8% 2018
POPULAR1MF RACE 6.7 11.88 56.4% 5.2% 20.3% 8.2% 11.1% 8.7% 2019
PHPMF1 RACE 7.1 11.82 60.1% 3.5% 22.5% 7.4% 10.9% 8.0% 2019
1
Price as on September 25, 2017; NAV as latest published
2
On latest cash dividend declared
3
CAGR computed for respected periods, except for 2017, adjusted for dividend. YTD returns of funds debuting within the year represent return generated since debut, hence is not
directly comparable with return of funds that operated throughout the year.

Fund Managers Performance Summary

‘Fund Managers’
Dividend NAV Return
Fund Manager AUM (BDT mn) P/NAV Ranking by Return1
Yield (%)
2017 YTD 2016 2014-16 2012-16 2016 2014-16 2012-16
RACE 32,258 57.8% 3.1% 19.3% 8.5% 9.9% 8.1% 5 4 3
LR Global 10,507 73.6% 6.3% 15.2% 4.2% 5.6% 5.3% 6 5 5
ICB AMCL 7,555 84.1% 8.8% 22.0% 13.8% 10.1% 5.6% 4 3 4
AIMS 4,506 76.0% 7.5% 19.8% 15.5% 12.7% 11.7% 2 2 2
VAML 3,358 77.6% 3.0% 17.0% - - - - - -
VIPB 2,300 93.6% 9.8% 22.4% 19.5% 16.9% 14.7% 1 1 1
SEML 1,548 91.4% 5.3% 7.5% - - - - - -
ATCP AMCL 819 91.3% 12.8% 19.2% 14.4% - - 3 - -
CAPM 518 84.1% 0.0% 5.0% - - - - - -
AMC Industry 63,369 68.7% 5.3% 18.5% 9.6% 9.7% 7.9% - - -
Position of the respective fund manager in the ranking of 6 managers by return in respective horizon
1

Sector Return (September, 2017)

40 of 40
BRANCH ADDRESS
CORPORATE HEAD OFFICE
MYMENSINGH BRANCH
Swapnaneer Tower (1st Floor),
27 C.K Ghosh Road,
Mymensingh 2200
BARISAL BRANCH
L L Tower (2nd Floor)
Holding No. 119, Sadar Road
Barisal 8200
Tel: +880 9609994352
HOME LOAN
BRANCH ADDRESS
D.R Tower, (4th Floor) 65/2/2
Bir Protik Gazi Golam Dostogir
Road, Purana Paltan, Dhaka-1000
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D.R Tower, (5th Floor) 65/2/2
Bir Protik Gazi Golam Dostogir
Road, Purana Paltan
Dhaka-1000
Tel: +880 (2) 9560111
Tel: +88 02 7763805-6
SAVAR BRANCH
‘Savar New Market’ (3rd Floor)
Holding No. 3, Savar Poroshova
Savar, Dhaka 1340
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ELEPHANT ROAD BRANCH
Pearsons Tower (1st Floor)
299 Elephant Road
Dhaka 1205
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AUTO LOAN
D.R Tower, (4th Floor) 65/2/2
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Road No. 14/A, Dhanmondi
Dhaka 1209
Tel: +880 (2) 5815 7632
Tel: +88 02 7343766-7
Tel: +88 02 9817647-9
COMILLA BRANCH
Artisan Nasir Center (3rd Floor)
437 Nazrul Avenue, Kandirpar
Comilla 3500
Tel: +880 (81) 64 907-8, 72881
HABIGANJ BRANCH
Shankar City (1st Floor),
Ram Krishna Mission Road,
Ghatia Bazar, Habiganj 3300
CHOWMUHANI BRANCH
N S S Bhaban (2nd Floor)
Feni Road, Chowmuhani
Noakhali 3821
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CORPORATE LOAN
41 of 40
IDLC ASSET MANAGEMENT LTD.
South Avenue Tower (5th Floor), Unit No.
502, House # 50, Road # 03, 7 Gulshan
Avenue, Dhaka 1212
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Bay’s Galleria (4th Floor) Paradise Tower (5th Floor),
57 Gulshan Avenue Plot No. 11, Sector No.3
Gulshan 1, Dhaka 1212 Uttara Model Town, Dhaka 1230
Tel: +880 (2) 893 2340, 891 9036
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Momotaj Tower (2nd Floor), Paper palace tower
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Kushtia Rangpur.
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Sahidullah Tower – 1 (2nd Floor) Hafeez Building (2nd Floor)
32/A Ranibazar, Ghoramara, Boalia 94 Mojib Sorok
Rajshahi 6100 Faridpur 7800
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