Re-Listing Of Otc Cos
BSEC to impose lock-in on sponsors’ shares
The Bangladesh Securities and Exchange Commission has planned to impose lock-in on shares of the sponsor-directors of the companies which will be re-listed with the stock exchanges from the over-the-counter market, a BSEC senior official told New Age.
The commission made the move in the backdrop of abnormal price hike and suspicious trading of shares after re-enlistment of an OTC company with the main market, the BSEC official said.
The regulatory step may prevent manipulative share trading for making abnormal profit within a short time, he said.
The lock-in period may last from one year to three years, he said.
A Tk 30-crore minimum paid-up capital requirement might also be followed for re-enlistment of OTC companies with the main market, the official said.
Following extreme pressure from the capital market regulator, the DSE in May this year approved Wata Chemicals’ enlistment despite not having a paid-up capital of Tk 30 crore.
The paid-up capital of Wata Chemicals was Tk 6.30 crore when it was re-listed which is Tk 23.70 crore less than the DSE’s listing requirement.
The price of Wata share was Tk 49.5 each against the face value of Tk 10 each on May 14 when the trading of its shares resumed after four and a half years of suspension.
On May 19, the price of Wata Chemicals’ shares rose to Tk 488 from Tk 59 a day before.
On the following day, the price of Wata shares rose as high as Tk 524.60 but eventually closed at Tk 449.60 when total 51,800 shares of the company were traded.
The DSE in 2009 delisted the company from the main trading section and transferred it to the junk share category.
Wata Chemicals, however, surprisingly returned to profit in the same year (2009), making Tk 0.12 profit per share, said DSE officials.
In 2004, the company counted Tk 7.21 loss per share, in 2005 Tk 1.30, in 2006 Tk 0.98, in 2007 Tk 1.16 and in 2008 Tk 1.41 loss each share.
The company after the re-listing declared 30 per cent stock dividend for the last year and showed that it earned a profit of Tk 2.97 crore in 2013 with Tk 6.13 earnings per share and Tk 119.82 net asset value per share against its earning of Tk 2 crore, EPS of Tk 4.12 and NAV of Tk 110.86 in the previous year.
Each share of Wata Chemicals had last traded at Tk 270 against the face value of Tk 100 before the DSE suspended the trading of the company in 2009.
DSE officials claimed a vested quarter might be making Wata share high stake gambling item as the low-paid up company has only 48.60 lakh shares with only 23 per cent in general investors’ possession.
As per the companies’ shareholding detail before the enlistment with the DSE, sponsor-directors of company along with ICB and its subsidiaries held around 77 per cent shares of the company.
-With New Age input
