LankaBangla Finance’s stock price registered a stunning gain of 71per cent in a space of a fortnight for no rhyme or reason.
The stock price rally began on December 23, when it was trading at Tk 21.9. On Monday, it closed at Tk 37.5, up 8.7 per cent from the previous day.
In that time, DSEX, the benchmark index of Dhaka Stock Exchange, gained 10.1 per cent, with the average daily turnover staying above Tk 1,500 crore.
The unusual price hike raised the suspicions of the Dhaka Stock Exchange, which sent in a query on Sunday asking if the company has any undisclosed price-sensitive information. LankaBangla replied in the negative.
Investors are eyeing higher profits from the company’s stock brokerage operations in the currently buzzing capital market, said several brokers requesting anonymity as they are not authorised to speak with media. The stock has been a regular member of the turnover leaders table in the past several sessions.
Approximately 3.4 crore shares of the company were traded in the Dhaka bourse on Monday, which is 6.4 per cent of the total outstanding shares of LankaBangla Finance.
However, the non-bank financial institution’s performance in the first nine months of 2020 though warrant a higher stock price than what was prevailing before the sudden rally.
The stock, which was listed in 2006, traded as low as Tk 11.6 per share in the previous 12 months.
In the first nine months of 2020, LankaBangla posted a profit Tk 47.5 crore, up a whopping 82.1 per cent from a year earlier.
And in the third quarter, it reported a profit of Tk 40.2 crore, in contrast to a loss of Tk 0.21 crore a year earlier.
LankaBangla Finance declined to comment for the report.