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 Exchange DSE, Bourse on the third working day of the week, November 28, ended with price Index & turnover drops. This information is known from DSE sources.
297 crore 20 lakh shares were traded on this day. 179 crore 14 lakh less trading was done in DSE today compared to the previous workday, 27 November, Shares worth Tk 369 crores 96 lakh shares were traded last time, Monday. From the DSE website, the lowest trade was done on 17 August, which was around 299 crore taka, which means after 70 working days the stock market hit its lowest today.
The benchmark DSEX lost 6.62 points or 6,202 The Shariah-based index DSES dropped 0.72 points or 1,346, and the blue-chip index DS30 decreased by 1.98 points or 2,099.
Of the issues traded, 17 advanced, 134 declined and 139 remained unchanged.
Ambee Pharmaceuticals PLC ranked top gainer on DSE, the share price increased by Tk 53.60 paisa or 6.83 percent. On this day, the share was last traded at Tk 838.40 paisa.
Bd. Thai Aluminium Limited ranked top loser on the DSE, the share price dropped by Tk 1.40 paisa or 7.73 percent. On this day, the share was last traded at Tk 16.70 paisa.
DSE topped on trade is Central Pharmaceuticals Limited 15 crore 96 lakh takas of shares of the company have been traded.
A total of 52 companies’ shares were traded in the Block on the Dhaka Stock Exchange, 60 lakh 14 thousand 277 shares of the companies were traded. The financial value of which is 29 crore 84 lakh taka.
One of the Listed companies, Ring Shine Textiles Limited has recommended no Dividend for the year ended June 30, 2023.
In terms of financial performance, The Company has further informed EPS loss of Tk. 2.53 for the year ended June 30, 2023. The Company has also reported NAV per share loss of Tk. 4.97 paisa.
The Annual General Meeting (AGM) of the company will be taking place on January 20, through the digital platform. The record date for this has been fixed at December 17.
One of the listed companies, Bd. Thai Aluminium Limited discloses its financial reports for the first quarter, (July-September 23).
The company’s diluted earnings per share (EPS) loss of Tk 0.19 paisa in Q1 of the current financial year (July-September 23). EPS loss of Tk 0.12 paisa during the same period last year. NAV per share was of Tk. 27.66 paisa as of September 30, 2023.
