Photo : Collected
Ever since the Bangladesh Securities and Exchange Commission (BSEC) lifted the floor price, the syndicate involved in share manipulation has become active again in the capital market. The syndicate has now targeted newly-listed companies and shares of companies with small capitalisation and weak fundamentals.
This syndicate boosted the share price of the new company by almost five times. And the share price of companies with low capitalisation and weak fundamentals increased from 2.90 taka to 127 taka per share. Sources in the Dhaka Stock Exchange (DSE) revealed this information.
Market insiders said that the syndicate is collecting hundreds of crores of taka by increasing the price of items and selling their shares. And ordinary investors are becoming losers by buying shares at high prices. But in this case, the regulatory body BSEC is playing the role of a silent spectator.
Md Al-Amin, a capital market analyst and Associate Professor at the Accounting and Information Systems Department of Dhaka University, told The Daily Messenger, “The current capital market is completely under the control of the syndicates. They are systematically increasing the price of items, then selling the shares. In such a situation, BSEC’s role of being silent seems like manipulation in the market is taking place under their leadership.”
According to DSE, the insurance company, Sikder Insurance Company Limited, was listed in the capital market on January 24 this year. The face value of the shares of this new generation company was Tk 10. This share was traded on the first day at Tk 11; since then, the share price has continuously increased. The company’s shares last traded at Tk 44.80 on February 19. That is, the price of the share has increased by Tk 32.20 or almost five times.
Despite the company’s lack of sensitive information on price hikes, prices rose at an unusual rate. The financial condition is also not very good compared to other companies in this sector. Earlier, the shares of this small-cap company were trading at Tk 49.30 on February 15.
Similarly, on February 6, Best Holdings Limited was listed in the capital market and started trading. Shares of this company were trading at Tk 40.30 on that day. Since then, the share price traded at a high of Tk 43.10 on February 14 due to manipulation by the syndicate. That is, a share of Tk 10 has increased to Tk 33.10 or more than four times.
‘Z’ category companies are considered the worst stocks in the capital market. One of the companies in this list is Meghna Condensed Milk Industries. Shares of this company, on January 31 this year, were Tk 22.90. From there, it has increased by Tk 5 in the last 19 days and last traded at Tk 27.60 on February 19.
A company in the same category is Mithun Knitting and Dyeing Ltd. Shares of this company were traded at Tk 14.40 at the beginning of February. In just 15 days, the share price increased by Tk 9 to trade at Tk 23.40 on February 19.
And the shares of Standard Ceramic Industries Ltd were traded at Tk 98.90 on the first day of February. From there on February 11, the share was traded at a maximum of Tk 122.90. And the last transaction on February 19 was at Tk 106.60. That is, the price of the share has increased by Tk 24.
Also, on February 1, the share price of Gemini Sea Food PLC was Tk 326.60, which was last traded at 402.20 on February 19. That is, the share price increased by Tk 75.60.
One of the low-capitalized and weak companies is Monno Fabrics Limited. The company’s share traded at Tk 14.70 on the first day of February. From there, it increased by Tk 11.90 and traded at Tk 26.60 on February 19.
The syndicate has also taken over the shares of Khan Brothers PP Woven Bag Industries Limited since the beginning of the new year. As a result, the share traded at Tk 103.40 on January 1, and it was sold at Tk 218.30 on January 25. Then in February, it increased by Tk 12 and traded at Tk 230.50 on February 19. That is, the price of the share has increased by Tk 127.10 in the last one and a half months.
SBAC Bank PLC is a bank sector company in the same category. Shares of this company were trading at Tk 8.60 in early February. That share increased by Tk 2.90 and traded at Tk 11.50 on February 19. Shares of Al-Haj Textile Mills Limited were at Tk 142. From there, they increased by Tk 16.80 and were last traded at Tk 158.80 on February 19.
The share price of Fu-Wang Ceramic Industries Ltd was Tk 17.20. From there, it increased by Tk 8.70 and traded at Tk 25.90 on February 19. Also, the share price of Sonali Aansh Industries Limited increased by Tk 122 from Tk 554.90 to Tk 677.70.
According to DSE sources, there is no price-sensitive information behind the increase in the share price of these companies. Then, the DSE authorities have written to the companies to know why the prices have increased. The companies told DSE that there was no price-sensitive information behind the price hike.
In this regard, DSE’s Managing Director (MD) ATM Tariquzzaman told The Daily Messenger, “The share prices of several companies, including Monno Fabrics, Mithun Knitting, Meghna Condensed Milk, Al-Haj Textile, Fu-Wang Ceramic, and Khan Brothers PP, have increased at an unusual rate. A letter has been sent to the company authorities after seeing this situation. They said they do not have any price-sensitive information.”
He also said, “Now the surveillance department of DSE is looking into the matter as to why the share price is increasing. BSEC will be informed if any evidence of manipulation is found. BSEC will take action if necessary.”
Mohammad Rezaul Karim, Executive Director, and Spokesperson of BSEC said, “The share prices of some companies have increased at an abnormal rate. We are confiscating the shares of these companies. We will take legal action as soon as we get evidence.”
Messenger/Fameema
