Bangladesh Securities and Exchange Commission on Wednesday said it was investigating unusual price hike of shares of some companies and four-day sharp fall of the market.
‘We formed committees to investigate JMI Syringes and Medical Devices, Summit Purbanchal Power Plant, CVO Petrochemicals and AlHaj Textiles Ltd in last few months after our surveillance system detected unusual price hike of shares of these companies,’ the BSEC said in a press release on the day.
It said the commission in a meeting on Tuesday decided to take immediate action against violation of the securities rule by those companies based on the investigation report.
Recently, share prices of some companies shot up abnormally which was highly criticised by the experts. Such rise also questioned the monitoring of the market regulator which prompted the BSEC to come up with immediate action.
The share price of JMI Syringes and Medical Devices, a newly-listed company, increased to its highest level in the first 15 trading sessions.
The share price of the company increased to Tk 133.5 on Thursday after starting with Tk 35.5 on June 19 this year.
The price earning ratio of the company stood at 417.19. The paid-up capital of the company is Tk 11 crore.
The share price of CVO Petrochemicals, which has a face value Tk 10, increased by Tk 346.40. The price of the share was Tk 89.6 in April which increased to Tk 436 on July 11.
The share price of CVO Petrochemicals, previously known as Chittagong Vegetable, during a bubble-burst in 2010 increased to Tk 6,000 from Tk 32.
Savar Refractories and MIDAS Finance, companies under the ‘Z’ category, were among the most advanced 20 shares in June.
The BSEC said that it started investigation in sharp fall of share prices in last four days.
From July 18 to July 23 the key index of the Dhaka Stock Exchange, DSEX, lost 294 points.
The BSEC also started enforcement action against 18 stock brokers and dealers for ‘short sale’ of client shares.
‘13 brokers already served the show-cause notice for short selling and hearing of five other brokers is completed,’ it said.
DSEX, the old key index of the Dhaka Stock Exchange, however, increased 1,120.35 points on July 16 from May 2 as the government has taken several steps to stabilise the market.
Following a BSEC proposal, the Ministry of finance on May 5 this year asked the Bangladesh Bank to provide Tk 1,266 crore to implement the refinance scheme for the investors affected by the small-scale investors.
The Bangladesh Bank on the same months also relaxed some provisioning rules for the banks that boosted the market.
Investors again started to invest on the basis of rumour- based information rather than investing on fundamentally strong companies.
Experts in the capital market during the mid-July said that the prices of some stocks again increased abnormally unlike the bubble in 2010.
-With New Age input
