Stocks
Over Half of the DSE money are still trapped at floor prices
The stock market with the unusual floor price support has regained vibrancy to generate over Tk1,000 crore in turnover daily and people on the street are talking about which stock to chase right now for astounding gains.
Everything is happening providing 52pc of scrips stuck on the price floor that came into result from the last trading session of July.
Hence, the 4 October market report by the research team of brokerage firm Royal Capital Ltd, 193 of the 369 scrips in the Dhaka Stock Exchange (DSE) were stuck at the floor price – which means there were lots of sale orders amid no buyers at the lowest allowable price.
The price floor being loved by a large number of dealers, mostly retail ones, is also frustrating significant market participants, especially institutional investors, who want the market to remain free enough to find more buyers and sellers for the sake of exchangeability and a genuine price discovery mechanism.
Blue-chip shares, that are stuck on the floor, increased the agonies of serious investors as many are unable to sell large-cap stocks such as Grameenphone (GP), Square Pharmaceuticals, BRAC Bank, Renata, Singer Bangladesh, regardless of their need for cash or will to hold onto trades.
10 of the 30 blue chip companies on the DSE are hibernating on the floor having bare trades at the price level.
BAT Bangladesh, BRAC Bank, Fortune Shoes, Grameenphone,(GP), Islami Bank, LankaBangla Finance, Renata, Robi, Singer Bangladesh and Square Pharmaceuticals were the DS30 companies stuck on the floor on Tuesday.
Like many, CFA Society Bangladesh President Shaheen Iqbal in a recent capital market hosted a show, suggests that the floor price should not be in place because it was causing the price and preventing the development of the capital market.
A stock might go down and also come back to its fair level in a free environment, he said, referring to the argument that a fall in stock prices is not the end of the world.
The floor steroid, hence, worked in helping the market recover from its 14-month low at the end of July.
DSEX, the broad-based index of the DSE surged by 9.43pc to 6,544 on Tuesday, from 5,980 on 28 July 2022.
The Bangladesh Securities and Exchange Commission (BSEC) made the price floor effective from 31 July, which is not allowing any money to trade below the then price level.
Responding to the criticisms of the stock market regulator’s repeated market disruption moves, BSEC Chairman Professor Shibli Rubayat-Ul-Islam in August said that the commission was undone because of the market structure – the dominance of retail investors who needs some protection.
Floor is so strong in the investors’ psyche in the bourses of Dhaka and Chattogram that a rumor in early September that the regulator might revoke the controversial price floor triggered a massive selloff in the stock market and the market later bounced back after the top BSEC officials’ promises that the commission was not even thinking of anything like that.
Dhaka Stock Market DSE, Bourse on the second working day of the week, 30th September, ended with a negative performance in Indices and a hike in Turnover from the previous working session. This information is known from DSE sources.
503 crore 90 lakh taka shares were traded on this day. 22 crore 58 lakh more tradings were done in DSE today compared to the previous workday, 29th September, Shares worth Tk 481 crores 31 lakh shares were traded last time, Sunday.
The benchmark DSEX lost 33.61 points or 5,624 The Shariah-based index DSES dropped 7.36 point or 1,263 and the blue-chip index DS30 decreased by 9.57 points or 2,053.
Of the issues traded, 72 advanced, 299 declined and 25 remained unchanged.
Shahjibazar Power Company Limited ranked top gainer on DSE, the share price increased by Tk 4.00 paisa or 9.76 percent. On this day, the share was last traded at Tk 45.00 paisa.
Dhaka Electric Supply Company Limited ranked top loser on the DSE, the share price dropped by Tk 1.80 paisa or 7.56 percent. On this day, the share was last traded at Tk 22.00 paisa.
DSE topped on trade is Pragati Life Insurance Limited 25 crore 35 lakh takas of company shares have been traded.
A total of 27 companies’ shares were traded in the Block on Dhaka Stock Exchange. A total of 1 crore 50 lakh 42 thousand 956 shares of the companies were traded. The financial value of which is 65 crore 60 lakh taka
One of the Listed companies, National Polymer Limited has recommended 10.50% Cash Dividend for the year ended June 30, 2024.
It has reported Consolidated EPS of Tk 2.27 paisa, and Consolidated NAV per share of Tk 30.63 for the year ended March 31, 2024.
The Annual General Meeting (AGM) of the company will be held on December 18, through the digital platform. The record date for this has been fixed at October 22.
The Company also discloses its financial reports for the second quarter, (April – June 24).
As per the company’s consolidated life revenue account for April to June 2024, the excess of total income over total expenses, including claims (surplus), stood at Tk 1,394.24 million. This marks a significant increase from the surplus of Tk 823.68 million during the same period in 2023.
For the first half of 2024, from January to June, the company reported a surplus of Tk 2,177.57 million, compared to Tk 1,290.39 million in the corresponding period of the previous year.
Additionally, the Life Insurance Fund balance as of June 30, 2024, reached Tk 55,188.62 million, showing a net increase of Tk 5,892.25 million from Tk 49,296.37 million on June 30, 2023.
One of the Listed companies, Beacon Pharmaceuticals PLC has recommended 20% Cash dividend and 10% Cash Dividend to Sponsor Shareholder and Directors for the year ended June 30, 2024.
It has reported EPS of Tk 2.26 paisa, and NAV per share of Tk. 26.37 for the year ended June 30, 2024.
The Annual General Meeting (AGM) of the company will be held on December 23, through the digital platform. The record date for this has been fixed at October 27.
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