Stocks gain some grounds in 2014, but investors yet to recover losses

The small-scale investors affected by 2010-11 market crash are yet to recover losses although the market recovered some grounds during 2014, experts have said.
The key index of Dhaka Stock Exchange, DSEX, advanced by 13 per cent over the year to finish at 4,865 points on December 30 after beginning the year with 4,286.15 points.
Substantial amount of shares were added during the period as 26 companies raised Tk 2,978 crore from the capital market through initial public offerings and rights shares.
As per the DSE statistics, of the 26 companies, 17 raised capital worth Tk 1,980 crore through IPOs, while nine raised Tk 998 crore by offering rights shares during the period.
‘Although the market has increased marginally during the year, recovering small-scale investors’ losses of the 2010-2011 market crash remained mostly unachieved,’ former SEC chairman Faruque Ahmed Siddiqui told New Age on Tuesday.
‘Loss recovering has become almost impossible for the investors who have invested margin loan fund to the capital market during the market bubble in 2009-2010 due to interest burden,’ he said.
Siddiqui, however, said during the year the investors had recovered confidence over the market to some extent as the market behaved comparatively stable than the previous year.
Speaking about the newly-listed companies, he said the capital market was yet to attract many companies with good track.
Although the market performed better in 2014, losses of the investors, who have invested at the market peak, might remained unrecovered,’ former DSE president Shakil Rizvi told New Age.
Fresh investors might have made satisfactory return during the year as some companies’ share prices increased above the 2010 level, he said.
The steady rise of DGEN, the benchmark general index of DSE, from 2,795.33 points in January 2009 to 4,535.53 points in January 2010 had attracted both the institutional and small-scale investors to the securities market.
Sudden investment inflow, mostly from banking sector, had given rise to a boom in 2010 on which the DGEN had skyrocketed by 82.87 per cent to 8,290.41 points, with its peak of 8,918.51 points reached on December 5 in the year with a turnover of Tk 3,249 crore.
Powerful market cartels composed of speculators, brokers, auditors, company-owners, and even officials of regulatory bodies, allegedly had used the huge liquidity flow to generate a price surge that had gone far above the fundamentals of the companies concerned.
In 2009, the BSEC (then SEC) and the BB asked the commercial banks to transform their merchant banking departments into separate legal entities which turned the banks’ investments in their merchant bank wings into loans.
The BB, however, in December 2010 directed the commercial banks to reduce by August 21, 2011 the amount of the credit they had given to single borrowers to within the ceiling of 15 per cent of their paid-up capital.
That had forced the merchant banks to sell off their investors’ shares to ensure that their parent banks could keep their single borrower exposure within the BB-set limit.
All the factors acting together brought down the unsustainable market system in just two months, with the DGEN crash-landing from 8,723.18 points on December 1, 2010 to 7,572.61 points on January 30, 2011, producing the big bang of the crash, the aftershocks of which had since been continuing to decrease the share prices further.
The worst-ever stock crash in the country’s history had wiped out even the initial capital investment made by thousands of investors.
The aftershock of the market crash of late 2010 had continued throughout the following years where DGEN had lost 3,032 points in 2011 and 1,038 points in 2012.
The DGEN hit the lowest ebb on January 4, 2013 at 3,383.23 points since November 15, 2009.
The Dhaka bourse introduced new general index, DSEX, on January 28, 2013 which hit its lowest value at 3,438.90 points on April 30 this year and reached its highest at 4,439.60 points on November 20.
The government in the 2011-2012 took initiatives to waive 50 per cent interest on margin loans for the small-scale investors affected by the stock market crash and introduced a refinance scheme of Tk 900 crore.

-With New Age input

Related News

Prime Bank opens Japan Desk

Business Desk : Prime Bank has officially launched “Japan Desk” with the objective of facilitating cross-border business initiatives and investments between Japan and Bangladesh. Naoki Ito, Japanese ambassador to Bangladesh, and Tanjil Chowdhury, chairman of Prime Bank, inaugurated the special desk at a local hotel in Dhaka, a press release said. “As many Japanese ... Read more

GP, EdTech collaborates to promote digital learning

Business Desk : Grameenphone has recently collaborated with Shikho – an EdTech venture in Bangladesh, to promote digital learning. Through this partnership, the connectivity partner to Digital Bangladesh, will host an array of educational content prepared by Shikho on its flagship app MyGP.  MyGP users can now avail of the 70-learning video content directly ... Read more

VLCC Health Care signs MoU with influencer Barisha Haque

Business Desk : VLCC Health Care Bangladesh on Saturday has inked an agreement with influencer Barisha Haque for promotion of its “Body after baby” programme. Under this agreement, Barisha Haque will be the delegate of Body after Baby program and shall be responsible to promote and give reviews over the services and products as ... Read more

NRB Bank launches eKYC ‘NRB Quick Account’

Business Desk : NRB Bank has formally launched its eKYC named as NRB Quick Account on 29 September at the bank’s Corporate Head Office, Dhaka. Mohammed Mahtabur Rahman, chairman of the bank formally inaugurated the programme, reads a press release. eKYC is a combination of paperless customer onboarding, promptly identifying and verifying customer identity, ... Read more

Fortune Rice Bran Oil observes World Heart Day

Business Desk : Fortune Rice Bran Oil, a brand of Bangladesh Edible Oil Ltd, celebrated World Heart Day on 29 September by providing free health services and special discounts on products. The oil company gave free health services at 22 parks in 10 major cities, and branded caravans roamed around major points in Dhaka ... Read more

Shwapno opens new outlet in Bogura

Business Desk : Shwapno, the country’s biggest retail chain shop, launched its new outlet in Bogura Upashahar area on Friday. During the inauguration programme, franchisee Mohammad Rashdeul Islam, managing director of Bogura Nursing Home AHM Mushihur Rahman, businessman AKM Rajiullah, Hafej Abdul Gaffar Imam, Shawpno zonal manager Musa Tarek, and outlet manager Siddiqur Rahman ... Read more

Hyundai cars will be assembled locally: South Korean envoy

Business Desk : Hyundai cars of Korea will be assembled in Bangladesh by the year end, South Korean Ambassador to Bangladesh, Lee Jang-keun said on Sunday. He said that in recent years, there have been some obvious and significant developments. The majority of Samsung Electronics’ gadgets are produced at Narsingdi in partnership with a ... Read more

Meghna EZ attracts Swiss investments

Business Desk : Sika Bangladesh, a subsidiary of Swiss Sika Group, a producer of construction chemicals, would invest US$6 million to develop a 10,000 square meter plant in the Meghna Industrial Economic Zone (Miez) in Sonargaon, Narayanganj. The factory will mainly produce admixtures and grout, an official said. Construction chemical products worth around Tk ... Read more

EBL raises Tk 122.4cr for TMSS

Business Desk : Eastern Bank Limited (EBL) has raised Tk 1,224 million (Tk 122.4 crore) through the issuance of zero-coupon bonds for Thengamara Mohila Sabuj Sangha (TMSS), a microfinance institution in Bangladesh. The EBL acted as the lead arranger while MTB Capital Ltd played a role as the trustee of the deal, said a ... Read more

Nagad offers up to 20pc cashback for Puja

Business Desk : Mobile financial service Nagad on Monday rolled out a campaign titled “Utshab er Khushi Nagad-a Beshi” on the eve of Durga Puja. Under the campaign, they offered up to 20 per cent cashback and discount for its customers in lifestyle, e-commerce, and restaurant categories at over 50 brand outlets across the ... Read more

GP, Hatil team up to enhance lifestyle

Business Desk : Leading mobile phone operator Grameenphone paired up with premium furniture brand Hatil to enhance the lifestyle of its GPStar customers. Selim H Rahman, chairman of Hatil Bangladesh, and Asif Naimur Rashid, chief business officer of Grameenphone, signed the deal at the GPHouse in Dhaka on Monday, a press release said. Under ... Read more

Brac Bank opens 800th agent banking outlet

Business Desk : Brac Bank has achieved a milestone of opening the 800th agent banking outlet recently. Nazmur Rahim, head of alternate banking channels of the bank, inaugurated the outlet at Kaziganj Bazar in Habiganj on Monday. The bank serves around 2.10 lakh unbanked people in rural and semi-urban areas through its agent banking ... Read more

Newsweek report praises Walton

Business Desk : US weekly magazine Newsweek appreciates Bangladesh’s electric and electronics conglomerate Walton for its growing role in the economic growth and development of the country. The magazine highlighted the country’s development in their recent report, where it mentioned Walton is the corporate pride of Bangladesh whose spectacular growth runs parallel to that ... Read more

Rubana Huq honoured with Human Right Award by CNMI Sustainable Fashion Awards 2022

Business Desk : On the occasion of Milan Fashion Week, former president of Bangladesh Garment Manufacturers and Exporters Association Rubana Huq has been awarded the Human Right Award by CNMI Sustainable Fashion Awards 2022. The National Chamber of Italian Fashion, in collaboration with the United Nations Ethical Fashion Initiative, a programme of the International ... Read more

Registration for Banglalink’s ‘ennovators’ begins

Business Desk : Banglalink has kicked off the registration process for the sixth season of ennovators, a digital idea-based competition in the country. Ennovators is a platform for creative young people of the country looking to showcase their ideas in the field of digital innovation against the challenges of today’s world. Over the course ... Read more

DHL adjusts Bangladesh price for 2023

Business Desk : DHL Express, the world’s leading international express services provider, announced price adjustments today that will take effect on January 1, 2023. The average increase in Bangladesh will be 7.9 %, compared to 2022. “So far, 2022 has been another turbulent year with a volatile market environment challenging global trade. However, we ... Read more

TVS Motor launches new motorcycle

Business Desk : TVS Motor Company launched a 160cc motorcycle in Bangladesh yesterday bearing an anti-lock braking system J Ekram Hussain, managing director of TVS Auto Bangladesh, unveiled the TVS Apache 160 2V at a programme in Dhaka yesterday, said a press release. Rahul Nayak, vice-president of International Business of TVS Motor Company, Biplob ... Read more

CPA to start construction works of Bay Terminal in 2023

Business Desk : The Chittagong Port Authority on Wednesday informed that they had completed all the preparations, including land acquisition and design, to start the construction works of the Bay Terminal in Chattogram from January 2023. CPA chairman rear admiral M Shahjahan disclosed the information at a press conference at Munshi Fazlur Rahman auditorium ... Read more

Tri-nation firm Gava to invest $25.62m in Dhaka EPZ

Business Desk : Gava Private Limited, a company owned by Hong Kong, Sri Lanka and Switzerland, is going to invest $25.62 million at Dhaka Export Processing Zone (DEPZ) to set up a garment manufacturing industry. The company will produce annually 4.4 million pieces of jackets, fleece jackets, t-shirts, polo shirts, sweaters, trousers, coverall, stretch ... Read more

GP received approval to sell used recycled SIMs

Business Desk : The telecom regulator recently permitted Grameenphone (GP) to sell unused pre-approved old numbers that had been out of service for more than 450 days, a Bangladesh Telecommunication Regulatory Commission (BTRC) official said. Grameenphone has already started selling SIM cards against its suspended unused numbers, following regulatory approval. But, the ban on ... Read more