Shurwid Industries on its debut on Monday saw a 400-per cent or Tk 40 rise in its share prices despite having lower earning per share. Market operators termed the investors’ much attention to the newly-listed companies’ shares as irrigational and speculative.
The earning per share of the company was Tk 0.24 during third quarter (January-March) considering pre-initial public offering paid-up number of shares, while EPS of the company was Tk 0.23 in the same period of the previous year.
The EPS of the company, considering post-IPO paid-up number of share, stood at Tk 0.16.
Each share of Tk 10 of Shurwid Industries increased to Tk 50 on Monday.
The price earning ratio of the company stood at 64.55 on Monday depending on the day’s market prices, while the PE ratio of the company was 44.63 on Monday considering its previous year’s earning.
The company’s number of shares increased to 4,53,50,000 after the IPO from 3,13,50,000 before the IPO.
AIMS of Bangladesh managing director Yawar Sayeed told New Age, ‘Investors’ much attention to the newly-listed companies seems irrational and speculative.’
‘Investors oppose premium on IPO shares, but when a company gets listed with the capital market at face value investors focus very much on it as the share prices of the company double or triple in the first few trading session. Investors’ behaviour is confusing,’ he said.
The Bangladesh Securities and Exchange Commission on April 1 approved the IPO of Shurwid Industries Limited and the company raised Tk 14 crore floating 1.40 crore shares at an issue price of Tk 10 each.
As per the BSEC’s approval, Shurwid Industries raised the fund through the IPO to meet the cost of factory building expansion, to purchase machinery, generators, and to repay bank loans and IPO expenses.
The EPS and the net asset value of Shurwid Industries stood at Tk 1.09 and Tk 14.11 respectively as per the audited financial statement of the company for the year ended on June 30, 2013.
ICB Capital Management is the issue manager of the company.
-With New Age input
