Olympic’s Tk 206cr foreign share sales push turnover above Tk 1,100cr
Dhaka stocks surged for the fourth trading session on Thursday with the key index of Dhaka Stock Exchange, DSEX, hitting 23-month high amid injection of fresh funds by the investors.
Benchmark DSEX increased 0.44 per cent or 21.52 points, to close at 4,892.81 points, the highest after 4,917.37 points on January 18, 2015.
Turnover on the bourse increased to Tk 1,149.83 crore compared with that of Tk 864.24 crore in the previous trading session. Thursday’s turnover was the second highest after Tk 1,288.55 crore turnover on September 18, 2014.
A single block transaction of Olympic Industries’ 60,76,596 shares worth Tk 206.60 crore at Tk 340.00 each was the main reason behind the sharp rise in turnover on the bourse.
Block market is a wholesale trading facility that allows traders to buy or sell large numbers of securities bilaterally outside the public market. Because trades conducted in a block trading facility are typically between two parties, prices are set with certainty and execution is done without delay.
Price of shares, which were traded on the block market, was comparatively higher than that in the public market. Olympic shares were last traded at Tk 312.90 on Thursday, 7.97 per cent lower than the block transaction.
In the Olympic’s block transaction, shares were sold by a foreign investors’ account with a merchant bank while some local organisations have purchased the shares, said market sources.
‘As such transaction does not impact the regular market price, commission found nothing unusual with the transaction,’ said a senior BSEC official.
He, however, did not find the Olympic’s share transaction prices on the block market was that high considering prices of shares in the regular market.
Sponsor-directors hold 28.92 per cent Olympic shares out of its total 1904,17,987 shares, while foreign investors hold 39.55 per cent, general investors 11.98 per cent and institutional investors 19.55 per cent shares of the entity, according to a shareholding report of November 30, 2014.
Apart from the block transaction, share prices of 151 companies and mutual funds out of traded 325 scrips advanced on the day, 125 declined and 49 remained unchanged.
Stockbrokers said that the market continued to rise mainly due to injection of fresh funds by the investors in an expectation of further rise in share prices.
Recent market surge of around 450 points, attracted investors, who were on the sideline for last couple of years due to the prolonged sluggish market movement, in purchasing shares, they said.
Apart from that, in absence of political uncertainty, relaxation of Bangladesh Bank’s policy with a view to allow banks to adjust their capital market over-exposure without any share sales and downward interest rate on bank deposits were the major reasons behind the recent upward market movement, said stockbrokers.
‘Last trading session of this week closed with fervent optimism shown by the investors,’ said LankaBangla Securities in its market report.
‘The broad index DSEX has broken the resistance level of 4,870 points on Thursday and is heading towards the next resistance level of 4,965 points,’ it said.
DS30, the blue-chip index of DSE, increased 0.14 per cent or 2.55 points, to close at 1,795.66 points.
Besides Olympic, Aftab Automobiles, Shasha Denims, IFAD Autos, Olympic Accessories, Ratanpur Steel Re-Rolling Mills, GBB Power, Quasem Drycells, City Bank and Argon Denims were other turnover leaders.
S Alam Cold Rolled Steels gained the most, adding 9.93 per cent, while Shyampur Sugar Mills was the worst loser, shedding 9.32 per cent.
Want stories like this in your inbox?
Sign up to exclusive daily email
More Stories from Stocks