Thousands of investors, who have deposited around Tk 3,969 crore for purchasing initial public offerings of Mobil Jamuna Limited Bangladesh and MI Cement, are in agony over the fate of their investments after the government suspended the IPO procedures of the two companies under the book-building method.
Analysts said that the market regulators should immediately decide whether the IPO procedure would be scrapped and take steps so that investors get their money back as soon as possible.
During the subscription period, between January 2 and January 6, for the lottery for distribution of 4 crore shares of MJL, investors deposited Tk 2,368 crore against the total value of the shares of Tk 609 crore.
Investors also deposited Tk 1,601 crore for the lottery of three crore shares of MI Cement between January 9 and 13.
The companies were waiting for the regulators’ nod for holding lotteries for allocating the shares to investors when finance minister Abul Maal Abdul Muhith on Sunday announced that the IPO procedures of the companies under the book-building system would be suspended.
The market regulators, Securities and Exchange Commission, were criticised by market analysts and general investors for allowing the companies to issue high-priced shares under the book-building system.
The MJL set price of per share at Tk 152.40 after the biddings of institutional investors against the face value of Tk 10 while the price of MI Cement was set at Tk 111.60 against the face value of Tk 10.
Jasim Uddin, an investor who had deposited Tk 15,240 for a lot of shares of MJL, said that he was worried about his investment for the company.
‘I want my money back or the shares as soon as possible. I am in confusion what would happen to my investment,’ he said.
Market analyst Salahuddin Ahmed Khan, who teaches finance at Dhaka University, said that share prices of the two companies were set high.
‘Investors are in problems as they do not know when or whether they will get shares or the money back,’ he added.
Salahuddin, also a former chief executive officer of Dhaka Stock Exchange, told New Age, ‘If the companies give back the money to investors then market would get liquidity of Tk 3,969 crore and it would be very positives for the market.’
An official of SEC said that as the government decided to suspend the IPO procedure, they were expecting a decision from the government soon on the investment of the general investors.
