BSEC suspends share trading of 3 cos after exorbitant price rise

Sends 5 others to spot market

Staff Correspondent | Published: 22:00, Aug 16,2018

 
 

A file photo shows the front view of Bangladesh Securities and Exchange Commission building in the capital. The Bangladesh Securities and Exchange Commission on Thursday suspended trading of the shares of three companies — Monno Jute Stafflers, BD Autocars and Legacy Footwear — for next 30 trading days following unusual and astronomical hike in the prices of their shares.— New Age photo

The Bangladesh Securities and Exchange Commission on Thursday suspended trading of the shares of three companies — Monno Jute Stafflers, BD Autocars and Legacy Footwear — for next 30 trading days following unusual and astronomical hike in the prices of their shares.
It also sent five other companies — Monno Ceramic Industries, Key&Que, Aziz Pipes, Stylecraft and Dragon Sweater and Spinning — to the spot market for an indefinite period for the unusual price hike of their shares.
The BSEC ordered the Dhaka and Chittagong stock exchanges to carry out its directive in this regard with immediate effect following weeks of criticism over lack of action from the market regulator in reigning in the unusual price hike of the companies.
The commission also decided to form an inquiry committee to investigate abnormal price hike of BD Autocars and Legacy Footwear.
The committee headed by BSEC deputy director Shamsur Rahman has been asked to submit report within 30 working days.
The committee will find out the reasons for the recent unusual share price hike of these companies and will also look into whether there were any insider trading, manipulation and securities rules violation, a senior BSEC official said.
The commission came up with the punitive measures after the watchdog detected anomalies in the trading of the companies’ shares.
BSEC executive director and spokesperson Saifur Rahman told New Age that investigation conducted by the commission found irregularities in their share trading that forced the commission to take such a harsh decision.
He also said that the commission would continue investigating these companies and would bring the errant investors and officials of the companies to book.
He also said that there were some more wrong-doing companies and the commission would also take action against them.
The share prices of Monno Jute Stafllers rose by 500 per cent to Tk 5,640, Legacy Footwear by 380 per cent to Tk 263 and BD Autocras shot by 300 per cent to Tk 436 in last couple of months without any price sensitive information.
The share prices of Dragon Sweater soared by 3 times in early August to Tk 50 from Tk 17 in June before closing at Tk 37.8 on Thursday.
The share prices of Monno Ceramic shot by 204 per cent to Tk 351 in last couple of months.
Key & Que reached Tk 233 in June from Tk 139 in the beginning of April despite remaining out of operation for long.
The share prices of Aziz Pipes reached its highest point at Tk 269 in July from Tk 128 in May, while the share prices of Stylecraft reached Tk 2,995.1 on Thursday from Tk 1,402 in March.
Market experts said that the BSEC should have taken the decision much earlier.
They said that the regulator should find out the root causes of the manipulation.
As the compnaies have small number of shares, gamblers can easily manipulate the prices of the shares through group trading, they said.
The paid-up capital of Monno Jute Stafflers is Tk 46 lakh, that of BD Autocars Tk 3.86 crore and that of Legacy Footwear Tk 11.37 crore.

More about:

Want stories like this in your inbox?

Sign up to exclusive daily email

Advertisement

images

 

Advertisement

images