RAK Ceramics (Bangladesh) Limited - DSE

Company. If exchange rate is increased against local currency opportunity willbe created for generating more profit.Management perceptionVolatility of Taka against Dollar and recent trend of local currency devaluationmay expose foreign currency risk. In such cases, the management of thecompany is confident to significantly cushion the foreign currency risk andprice escalation risk through forward contracts if it is justifiable in terms of thecost benefit analysis. The company has been hedging exchange rate risk bystrategic purchases of raw materials, consumables & forward booking of foreigncurrency. The parent Company has database of over 2500 suppliers all over theworld with whom they are dealing for more than last 15 years, normally parentcompany does a global resource planning exercise on monthly basis whichtakes care of resource procurement schedules, currency fluctuation escalationfactor.(c)Industry risksIndustry risk refers to the risk of increased competition from foreign anddomestic sources leading to lower prices, revenues, profit margins, marketshare etc. which could have an adverse impact on the business, financialcondition and results of operation. Ceramic industry in Bangladesh is anemerging sector with vast local demand for its differentiated product lines.Locally produced ceramics products now play a significant role in this sector,which has being dominated by imports in the past.Management perceptionRAK Ceramics (Bangladesh) Limited is known in the market as innovativetechnology driven capital intensive company, it has track record to upkeep withtechnology investment which proven them as trend setters. Also due to itssuperior quality and competitive pricing, wide variety of product range, RAKCeramics (Bangladesh) Limited has been able to capture a dominant position inthe market and has a brand equity presence in the local market. The companyis continuously working on product development through research anddevelopment (R&D), improved designs and service to keep pace with thecustomer choices, fashion and design. The company being a market leader inthe ceramic tiles and sanitary ware products in Bangladesh has alreadycaptured over one fourth of the tiles market and more than two third of thesanitary ware market. As a result, company is quite well insulated from therisks of greater competition from both local and foreign sources.With strong brand equity, the management is confident that the new entrantswill not be a considerable threat for the company. Being the market leader withthe best quality product, operational efficiency, organized marketing anddistribution network, there is little opportunity for others to become asignificant competitor. Use of tiles becomes necessity in absence of any otheralternate product and due to technological revolution, hygiene, homogenous