In a surprising turn of events, the publicly listed Olympic Accessories Limited, grappling with three consecutive years of losses, experienced a remarkable 78% surge in its share price over just 14 trading sessions. The company’s shares, trading at Tk11.5 each on November 30 at the Dhaka Stock Exchange (DSE), escalated to Tk20.5 by December 20. The share price modestly retreated to Tk18 on the subsequent Sunday.
This surge is not the first instance of an abnormal increase in the share price of the loss-making company; a similar uptick of 75% occurred in June this year when shares reached Tk17.4. Prior to this unusual surge, the shares remained at the floor price for over six months.
Market insiders attribute the recent spike to rumors circulating about a reputed garment accessories firm considering an acquisition of Olympic Accessories. However, in response to DSE’s inquiry, the company denied possessing any undisclosed price-sensitive information (PSI) that could have influenced the share price. Managing Director Golam Kibria dismissed the ownership-changing rumor as unfounded, asserting, “We have no such plans.”
Olympic Accessories has faced financial challenges due to a significant decline in purchase orders amid the global crisis, leading to consecutive losses. Kibria mentioned the management’s efforts to minimize losses in light of the challenging circumstances.
DSE reported that Olympic Accessories’ board of directors fell short of meeting the regulatory requirement of jointly holding a minimum of 30% shares, sparking the acquisition speculation. Currently, the board holds 25.81% shares, down from 44.43% at the end of the 2021-22 fiscal year, according to DSE data.
In the July to September quarter of 2023, the company reported a revenue of Tk37 lakh, compared to Tk1.26 crore in the same period the previous year. Despite efforts to curtail losses, the company incurred a loss of Tk1.42 crore during the quarter, up from Tk1.30 crore a year ago. The per-share loss amounted to Tk0.08, with a net asset value per share of Tk10.97 at the end of September 2023.
Listed on stock exchanges in 2015, Olympic Accessories has struggled to pay dividends to shareholders due to sustained losses.
