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Dhaka Tribune

Over half of listed companies suffer massive fall in share prices

Update : 20 Aug 2013, 05:41 PM

More than half of companies listed with Dhaka Stock Exchange (DSE) witnessed massive decline in share prices despite a number of remedial efforts taken by the government and the regulator.

The DSE data released recently showed the share prices of 80 companies fell over 20% in a year since July 2012 as the post-debacle rescue initiatives did not work.

According to the stakeholders, the companies had been continuing to lose prices as the investors could not regain their confidence on the stocks after 2010 debacle.

Of 294 listed companies including 43 mutual funds, 141 lost prices during last one year time, the data showed. The listed 80 companieswitnessed over 20% fall in share prices while 14 otherssuffered 40% drop due to continued slump in the market.

Of the share price indices,the newly DSE Broad Index (DSEX) edged 3.99% or 164 points to 3940 during last two months - June andJuly.

Market capitalization increased more than 6% to stand at Tk2503bn from July, 2012 to July, 2013.

According to the DSE data, the companies that lost over 40% in share prices included IFIC bank (43.32%), Al-Arafah Islami bank (43.66%), National Bank Ltd (46.35%), Prime Finance and Invest (45.83%), Kay and Que (54.86%), Purabi General Insurance (70.18%), Bangladesh Industrial Finance (51.85%), Beximco (46.79%), FAS Finance and Investment (53.17), Bangladesh Finance and Investment (46.95%), Shinepukur Ceramics 40.08%, International Leasing (43.44%), IDLC Finance (44.41%) and First Lease Finance (44.19%).

Among those losers,nine companies are in A category as investors are more confident on them considering the fundamental issues.

Prurabi General Insurance is one of the A category companiesand lost the highest 70.18% in share prices in last one year. Its share price stood at Tk21.2 on July 31, 2013 from Tk71 on July 30, 2012.

Purabi General was listed in 1995 and declared over 10% dividend in last 12 years, which indicates the company has good fundamental features.

Beximco was the most gambler of shares in the boom market from 2009 to 2010. But after the share market debacle in 2010, the investors could not recover their loss because of continuous falling. Even in last one year, Beximco’s share price declined 46.79% despite declaring 15% stock dividend for the year 2012.

“Although we invested in a company having good fundamental features, we have suffered losses,” said Abdur Rashid, a retail investor in DSE.

According to him, the market has failed to regain investors’ confidence on it in last two years after the debacle.

Prof Abu Ahmed, an economist, said most of the companies made losses in their own portfolios due to sluggish market, which put a negative impacton their profit at the end of the year.

“Due to losses, the companies declared less dividends in the year than the previous year. The lack of confidence among the investors made even fundamentally good companies make losses,” Prof Ahmed added.

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