Investment of Norway’s sovereign wealth fund (SWF), the world’s biggest fund, in Bangladesh’s capital market hit a record high in 2020 despite the coronaviruscentric sluggishness on the market.
The SWF has been increasing its stake on Bangladesh’s stock market every year since investing around $19 million in the country in 2015 amid expectations of better returns from the market.
In 2020, the fund’s investment value on Bangladesh’s capital market reached $248.35 million, which was $188.12 million in 2019.
The Norwegian government pension fund had footprints in 20 companies in 2020 against 22 companies in the previous year.
The foreign fund increased its ownership in seven companies, kept unchanged its holdings in six companies and reduced investment in four firms in 2020 compared with the previous year, according to the data of the Norges Bank Investment Management Company which manages the SWF.
The fund withdrew ownership in four companies and made fresh investments in three entities in the country’s capital market in the year.
The net investment value of the SWF on Bangladesh’s capital market was $202.91 million in 2018, $244.41 million in 2017 and $111.55 million in 2016.
The investment value of the SWF shot up by 30 per cent in 2020 due to a significant rise in the share prices of a number of companies, including Beximco Pharmaceuticals, Grameenphone and Bangladesh Submarine Cables Company.
The Norwegian government fund did not withdraw funds from an otherwise dull market while the other foreign investors continued to pull funds out of the market as it saw huge potential in the country’s stock market, market operators said.
The SWF increased its ownership in Singer Bangladesh to 4.29 per cent in 2020 from 3 per cent in 2019.
It also expanded ownership in Grameenphone to 1 per cent, in BRAC Bank to 3.45 per cent, in Beximco Pharmaceuticals to 3.26 per cent, in IPDC Finance to 2.74 per cent, in Square Pharmaceuticals to 2.17 per cent and in Renata to 0.88 per cent in 2020.
The foreign fund withdrew its entire investment in Esquire Knit Composite, Mercantile Bank, ONE Bank and Southeast Bank to invest in LankaBangla Finance, Walton Hi-Tech Industries and Robi Axiata Limited for the first time.
The fund cut investments in IFAD Autos, Prime Bank, Delta Brac Housing Finance, and Summit Power.
The SWF invested the highest $55.13 million in Grameenphone followed by $49.84 million in Square Pharmaceuticals, $32.64 million in Beximco Pharmaceuticals, $23.94 million in BRAC Bank and $11.52 million in Summit Power.
The foreign fund kept its ownership unchanged in IDLC Finance which amounts to 3 per cent, 2.95 per cent in City Bank, 2.62 per cent in Bangladesh Submarine Cable Company, 2.64 per cent in Eastern Bank and 0.98 per cent in Olympic Industries.
The SWF is one of the world’s largest funds with holdings in around 9,202 companies in 74 countries.
The fund invests in equity, bonds and real estate all around the world.
Want stories like this in your inbox?
Sign up to exclusive daily email
More Stories from Stocks