BD Autocars’ share price skyrockets despite paltry earnings
Dhaka stocks declined for the fifth trading session on Monday with the turnover hitting one-and-a-half month low amid investors’ pessimistic participation on the trading floor.
The key index of Dhaka Stock Exchange, DSEX, declined by 0.28 per cent or 12.91 points, to close at 4,592.17 points, the lowest after 4,568.35 points on September 6, 2016.
Turnover, a major indicator of investors’ participation on the trading floor, also declined to Tk 389 crore, lowest after Tk 314.93 crore on September 18, while turnover on the bourse was Tk 457.16 crore on Sunday.
Turnover on the bourse was above Tk 500 crore in all five trading sessions in last week including Tk 644 crore on Monday last week.
In line with the last four trading sessions, market finished negative for another trading session as investors remained pessimistic regarding the short-term market prospects, stockbrokers said.
Earnings declarations remained the major dominant factor behind the pessimism as another three companies failed to announced any dividend for their shareholders, they said.
On the other hand, investors’ profit booking share sales after earnings announcements also made other investors panicky, resulting further fall in share prices, stockbrokers said.
Of the 321 companies and mutual funds traded, 122 advanced, 161 declined and 38 remained unchanged.
DS30, the blue-chip index of the bourse, inched down to 1,733.43 points, shedding 0.08 per cent or 1.51 points.
The Shariah index, DSES, fell by 0.05 per cent or 0.63 points, to close at 1,100.04 points.
‘DSE passed another weak trading day as investors’ risk appetite has ebbed along with mixed corporate declaration of stocks,’ said LankaBangla Securities in its market report.
‘Profit booking continued as large and mid-cap stocks dragged the benchmark index below 4,600 points mark,’ it said.
Among all listed companies, prices of BD Autocars, a ‘Z’ category company, skyrocketed by 29.36 per cent to Tk 63.30 on Monday after the board of directors of the company declared 3 per cent stock dividend for the year ended on June 30, 2016.
The entity’s shares were traded at Tk 33.70 on June 30 this year, and since then the prices of share of the company increased by 87.53 per cent or Tk 29.60 with its earnings per shares of Tk. 0.40 for the year ended on June 30, 2016. Considering the EPS of the company, price earnings ratio of the company reached to an abnormal 158.25 when the overall market PE was around 15 on Monday.
The company did not declare any dividends for previous three years. The company for the last time in 2012 had issued 2 per cent stock dividends.
On the other hand, Legacy Footwear was the worst loser of the day, shedding 33.33 per cent, after the board of directors of the entity decided not to issue any dividend for the January 1, 2015 to June 30, 2016 period. Due to the board decision, shares of the company have already been placed in ‘Z’ category from ‘B’ category.
Besides, share prices of Doreen Power Generation and Distribution Company, the highest traded scrip of the day, fell by 9.22 per cent or Tk 11.40 to close at Tk 111.90 on Monday after the formation of an inquiry committee by the Bangladesh Securities and Exchange Commission on Sunday.
MJL Bangladesh, Argon Denims, Square Pharmaceuticals, Fortune Shoes, BD Thai Alluminium, Shasha Denims, Titas Gas Transmission and Distribution Company, Appollo Ispat Complex and National Tubes were other turnover leaders.
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