The country’s main stock exchange, Dhaka Stock Exchange (DSE), has warned investors about 62 companies listed on the stock market. Of these, 32 companies are closed and 30 are financially risky or in a very weak state. The DSE recently published two separate lists on its own website to raise caution when investing in shares of these companies.
DSE-related people say that this list has been published so that investors do not suffer losses by investing in shares of financially weak and long-closed companies. Through this, a ‘red alert’ or ‘warning signal’ has been issued regarding these companies. The purpose of this is to discourage investors from investing in these companies.
Sources said that recently, there has been an unusual increase in the share prices of some closed and weak companies. Trading in two such companies has already been suspended with immediate effect. The two companies are Shyampur Sugar and Sonargaon Textiles. Now, in the second phase, a warning has been issued regarding weak and financially risky companies.
We are giving the highest priority to protecting the interests of investors more than ever before….We want to take more proactive and strong measures to stop market manipulation.
Nuzhat Anwar, MD, DSE
When asked, DSE Managing Director (MD) Nuzhat Anwar told Prothom Alo, “We are giving the highest importance to protecting the interests of investors more than ever before. Efforts are being made to ensure that investors can get all the updated information of listed companies at once. As part of that, a separate list of closed and financially at-risk companies has been published. We want to take more active and strong measures to stop market manipulation. Various initiatives are being taken as part of that. Although various works were done separately earlier, now we are trying to organize them.”
Closed companies 32
According to the DSE list, the closed companies include Apollo Ispat, Aramit Cement, Aziz Pipes, Baraka Power, BD Welding, Dulamia Cotton, Emerald Oil, Familytex, GBB Power, Generation Next, Hamid Fabrics, Khulna Power, Khulna Printing and Packaging, Meghna Condensed Milk, Meghna PET, Metro Spinning, Mithun Knitting, Newline Clothing, Northern Jute, Noorani Dyeing, Pacific Denims, Prime Textiles, Rahima Food, RSRM Steel, Regent Textile Mills, Suhrid Industries, Shyampur Sugar Mills, Standard Ceramics, Tunghai Knitting, Osmania Glass, Yakin Polymer and Zahin Spinning.
However, despite the warning signal, most of the shares of these closed companies increased yesterday. Of the 32 closed companies listed, 22 increased, 6 decreased and 4 remained unchanged. Among them, the shares of Hamid Fabrics, Prime Textiles and Newline Clothings increased at the highest rate.
On June 4, there was a change in the leadership of the capital market regulator Bangladesh Securities and Exchange Commission (BSEC). The government appointed Masud Khan as the chairman. Along with this, three more commissioners were appointed. Masud Khan announced at a press conference on the day of taking charge that the commission would take real-time action against market manipulators. There will be special surveillance on Z-category companies from the beginning to control manipulation. Investor protection will be at the center of all BSEC activities.
* Initiatives to strengthen surveillance to prevent abnormal price increases in shares of weak companies.
* DSE has suspended trading of Shyampur Sugar and Sonargaon Textiles.
After assuming office, the newly appointed BSEC commission held a meeting with the board of directors and management of the DSE. It was directed that immediate action should be taken against the shares of weak quality companies whose prices increase abnormally without any specific reason. If necessary, the trading of these shares should be suspended and the reason for the price increase should be investigated quickly.
Following the BSEC’s directive, the DSE has immediately suspended trading of shares of weak quality companies that are experiencing abnormal price increases. At the same time, initiatives have been taken to publish updated information about companies to ensure investor protection. While such information was previously published in isolation, the DSE has now taken the initiative to make it more organized and regular.
30 companies on the risky list
Based on the financial reports, the concerned auditors have identified 42 listed companies as being at ‘going concern threat’ or ‘risk of uncertainty in business operations’. That is, there is a risk in running the business of these institutions due to various reasons including cash crunch. Based on the auditors’ opinions, the DSE has published a separate list of these risky companies.
10 companies on this list are also on the list of closed companies. In addition, two companies have closed transactions. As a result, there are actually 30 companies on this risky list, apart from the closed companies. The companies are Alltex, Anlima Yarn, BD Services, BD Thai Food, BIFC, Central Pharma, Dhaka Dyeing, Doreen Power, Fareast Finance, FAS Finance, First Finance, Global Heavy Chemicals, GSP Finance, Indo-Bangla Pharma, ICB Islamic Bank, International Leasing, Intech, Jute Spinners, Khan Brothers PP Woven Bags, Meghna Cement, NTC, People’s Leasing, Premier Leasing, Prime Finance, Safco Spinning, Sonargaon Textiles, Sunlife Insurance, Tallu Spinning, Osmania Glass and Jheel Bangla. Apart from this, First Security Islami Bank and Social Islami Bank, which have closed their transactions, are also on this list.
