JS body suggests listing of ICB firms on bourses

A parliamentary body has asked the Investment Corporation of Bangladesh (ICB) to immediately list its three subsidiary companies on bourses.

“We recommended that ICB list its subsidiary companies on stock exchanges. These three firms are ICB Capital Management Limited, ICB Asset Management Company Limited and ICB Security and Training Limited,” AHM Mostafa Kamal, chairman of the Parliamentary Standing Committee on Finance Ministry, told reporters after a meeting at the Jatiya Sangsad Bhaban yesterday.

The committee also suggested the newly formed Bangladesh Development Bank Limited take steps so that the bank gets relieved of sick clients or borrowing industrialists after settling their loans and other dues.

The bank, which came into being after the merger between Bangladesh Shilpa Bank and Bangladesh Shilpa Rin Sangstha, launched its operation recently with industrial financing, commercial banking and merchant banking at the core of its services.

Pointing his finger at the sick clients of the development bank, the parliamentary body chief said, “We have told the new bank officials to come up with a list specifying the very sick, sick and well running companies so that the list come under review in the committee's next meeting.”

SEC pores over 'flawed indexing' info

Two bourses followed apparently flawed computations for Grameenphone shares in November, despite clear instructions from the market regulator to follow a standard indexing method.

The bourses were meant to follow the instructions from September last year.

The Securities and Exchange Commission (SEC) is yet to describe the bourses' calculations as a violation of law, but has said computations were far from "reliable and verifiable".

“We are evaluating all the information collected. If the commission finds any violation or flaw in the method of their calculation, the commission will take necessary action,” said Farhad Ahmed, executive director of SEC, in a press briefing yesterday.

The Dhaka Stock Exchange follows IASCO-recommended guidelines in index counting, while the Chittagong Stock Exchange follows the Laspeyres index calculation method.

The SEC at a meeting on May 28, 2009 directed the two stock exchanges to strictly follow index calculations as prescribed by their respective systems.

IASCO guidelines say the calculation must be 'reliable and verifiable', and the Laspeyres method emphasises that index counting will be based on weighted average prices of a base period.

The search for information by the market watchdog comes, as it suspects that DSE followed different methods in different times.

Farhad Ahmed of SEC said the media reported that the exchanges had violated IASCO guidelines in index calculation and the market is based on flawed indexation.

“It is not appropriate, as the IASCO guideline does not say the index calculation should be from the second day of a company's share trading or that it should not be based on the first day's transaction," he said.

"The IASCO guideline says the calculations must be reliable and verifiable, which means the index can be counted from any day of a company's trading debut."

But both DSE's and CSE's calculation while incorporating Grameenphone shares showed unusual reflections in the key indices, which means the index calculation was not reliable and verifiable, he said.

The flawed counting also resulted in confusion among market experts, analysts, investors and stakeholders.

On November 16, 2009, the trading debut day of Grameenphone, the benchmark index of DSE skyrocketed by more than 764 points, as DSE counted the index from the first day, based on the face value of each Grameenphone share at Tk 10.

On the other hand, CSE calculated the index on a five-day weighted average price of Grameenphone shares, which also did not give an accurate picture in the index.

About the meeting in May, Satipati Moitra, chief executive officer of DSE, said: “I can hardly remember anything about the meeting. I will not say anything on the issue. Moitra was present at the meeting as the then chief financial officer.

CSE authorities say they calculated the index based on the Laspeyres method, the one they usually follow.

However, the distortion was acute in the case of Grameenphone, because of its size. Even though the same methods were followed in the previous cases, the distortions were not reflected because of the small capital sizes.

SEC now ordered the two exchanges to start counting the index from the second day of a company's trade, based on the first day's closing price.

“As it had seen a huge gap, in most cases, between the first day's trading price and the IPO price, the commission suggests counting the index from the second day,” Farhad Ahmed explained.

DSE upbeat on 2010

Dhaka Stock Exchange, already encouraged by this year's performances, sees a more stronger and stable capital market in the coming year.

“The market performed well with some milestone achievements this year. We saw the much-hyped Grameenphone listing, highest single day turnover, record levels of market capitalisation and key indices, introduction of book building method and many more,” DSE President Rakibur Rahman told journalists yesterday.

“All these successes have added to the investors' confidence. If the trend continues next year and new companies list on the bourses, daily turnover may reach Tk 3,000 crore level by December 2010,” he said.

Rahman also requested the government to increase the flow of good shares to keep the trend by balancing demand and supply.

The government can get more return by offloading shares in such public sectors as hospitality, aviation, port and other services sectors, he said.

Rahman however criticised the government for its intervention in the market this year.

DSE chief critical of regular SEC interference

Regular interference of theSecurities and Exchange Commission (SEC) creates a chance of misinterpretation in the capital market, DSE President Md. Rakibur Rahman said at an investors' awareness programme organised by Trust Bank in the city Monday.

"There should be no obligation for the merchant banks as they know well how to provide margin loans," the DSE president said.

"The government does not need to hold any road show abroad to create funds for infrastructure development. Non-resident Bangladeshis are waiting to invest in the country through the capital market," he added.

On the other hand, Professor Mohammad Musa, a teacher of the United International University said, "Directions relating to the capital market come from different authorities creating impatience among the investors."

The Merchant Banking Division of the Trust Bank organised the programme to create awareness among the investors. Shah A Sarwar, head of the Merchant Banking Division, was also present at the programme.

SEC moves to discipline brokering

The stock market regulator has asked banks, other financial institutions and insurers to form separate subsidiaries to run brokerage and dealer activities.

The subsidiaries must be formed by March 31 next year, according to a decision taken by the Securities and Exchange Commission at a recent meeting.

“Brokerage activities have widened and so an institution may face problems running usual work and brokerage and dealer activities under the same management,” said Ziaul Haque Khondker, chairman of SEC.

Some 200 brokers and dealer are registered with Dhaka Stock Exchange: 32 run by banks, financial institutions and insurance companies.

Of the 32 brokerages, 16 are run by banks, while other financial institutions and insurance companies operate the rest.

The banks which have brokerages are: NCC Bank, Islami Bank, City Bank, Bangladesh Shilpa Bank, Bangladesh Commerce Bank, IFIC Bank, Dhaka Bank, Mutual Trust Bank, National Bank, Pubali Bank, Mercantile Bank, Shahjalal Islami Bank, Bank Asia, Premier Bank and AB Bank.

Some financial institutions already have separate brokerage houses. They are: Phoenix Securities, International Leasing and Financial Services, Equity Partners Securities, IDLC Securities, Green Delta Financial Services, ICB Securities Trading Company, LankaBangla Securities, SES Company and BLI Securities.

The other financial institutions and insurers with brokerage houses are Bangladesh Shilpa Rin Sangstha, Sadharan Bima Corporation, IIDFC and Popular Life Insurance.

In October, Bangladesh Bank directed commercial banks to form separate subsidiaries to operate merchant banking.

A bank will have to take permission from Bangladesh Bank to set up a subsidiary company for merchant banking. The banks -- already in merchant banking -- will have to turn their units into subsidiaries by January.

DSE updates PE ratios of 240 companies

A total of 185 out of 240 listed issues, excludingmutual funds, non-demated and z-category shares, have price-earning (PE) ratio between 1.0 and 75, according to the DhakaStock Exchange (DSE) update on PE ratios.

However, the DSE updated the PE ratio of only 25 companies on the basis of their latest audited reports and the rest on the latest un-audited reports.

Most of banks and leasing companies have PE ratios below 75.

"As per directive of the Securities and Exchange Commission (SEC), the companies, the PE ratios of which are 75 or below, are eligible for loan facilities," Dhaka Stock Exchange (DSE) Chief Executive Officer Satipati Moitra told the FE.

"The rules and regulations on loan facilities vary from bank to bank. So a bank can choose any PE ratio below 75 in case of providing loan facilities," he added.

However, several merchant banks said they would rely only on audited reports in case of providing loan facilities.

"We'll not accept the PE ratios based on un-audited reports for providing any margin loan facilities and we've already sent our opinion to the SEC," Sheikh Mortuza Ahmed, Executive Vice President of Prime Bank Limited, told the FE.

The DSE updated the PE ratios based on different quarterly reports as of December 17. The PE ratios of the remaining companies will be calculated after having the clarifications from the companies, a DSE official said.

The DSE got the audited reports only from those firms, which ended their fiscal year on June 30, he added.

The move on PE ratio has been taken after a recent order of the SEC asking banks not to lend to any investor, who will purchase shares of a company, the PE ratio of which crosses 75.

The companies, the PE ratios of which are 75 or below as per audited reports, are: ICB (27.86), Aftab Auto (58.03 under continuous operation and 13.57 when extraordinary profit included), Gemini Sea Food (52.15), Meghna Condensed Milk (57.64), Fine Foods Limited (48.81), Padma Oil (14.39), Power Grid Company Limited (17.04), Sonali Ash Industries (30.69), Saiham Textile (26.24), Mithun Knitting (29.77), Prime Textile (29.65), Metro Spinning (16.23), Kohinoor Chemicals (31.96), Orion Industries (50.51), Marico Bangladesh (26.47), Samorita Hospital (30.42), Daffodil Computers (73.86), The Engineers Limited (1.35) and Savar Refractories Limited (66.38).

The number of companies having PE ratios above 75 based on their audited reports, is 05. They are Bangas Limited (146.33), Bangladesh Plantation (94.02), Hill Plantation (82.24), Imam Button (81.09) and Eastern Lubricant (121.04).

On the other hand, Meghna Pet Industries, Tallu Spinning, Altex Industries, Northern Jute, and Samata Leather Complex have negative PE ratios based on their audited reports.

The companies, the PE ratios of which are above 75 based on un-audited reports, include Bangladesh Industrial Finance Corporation, National Polymer, National Tubes, Rahima Food, Legacy Footwear, Monno Ceramic, Monno Jutex, Standard Ceramic, United Insurance, Purabi General Insurance, BSC, Modern Dyeing, Desh Garments, Dacca Dyeing, Ambee Pharma, Beximco Synthetics, Summit Alliance and In Tech Online Limited.

Mutual funds, non-demated shares, poor performing Z-category companies, newly-listed firms and companies, share status of which has been downgraded or upgraded, have not come under the purview of the recent SEC order.

Marico Bangladesh earns Tk 680m net profit

Marico Bangladesh Ltd has reported profit of Tk 680 million (68 crore) before tax during the fiscal 2008-09. The profit is 35 per cent more than that of the last year.

The company sold products of Tk 4.05 billion (405 crore) during the fiscal 2008-09 that is 53 per cent more compared to that of the last fiscal. The profit of the company amounted Tk 470 million (47 crore) after tax.

The board of directors of the company recommended 25 per cent cash dividend, declared December 13, 2009 the record date and decided to hold the next annual general meeting (AGM) on January 19, said a press release of Marico Bangladesh L

Salman new president of listed cos' assoc

Mr. Salman F Rahman, Vice Chairman of Beximco Group and Mr. AKM Azizur Rahman, Managing Director of Sonargaon Textiles Limited have been elected as the president and vice president respectively of the Bangladesh Association of Publicly Listed Companies for the period of 2010-2011.

The BAPLC is the top body of the companies listed with the stock exchanges of Bangladesh.

The new president and vice president were elected by a newly elected Executive Committee of the association Sunday, said a statement issued by BAPLC.

Earlier, the election Board of BAPLC declared 19 candidates representing the member companies in the association elected as members of the Executive Committee for the period of 2010-2011, under Rule 12 of the BAPLC Election Rules, 2002.

The members of the executive committee include-- Mr. Syed Manzur Elahi, Chairman, Apex Adelchi Footwear Ltd., Mr. Zafar Ahmed, Managing Director, Apex Foods Ltd. , B.D. Mukherjee, Managing Director Bangladesh Plantation Ltd, Mr. Samsul Alam, Chairman, Confidence Cement, Mr. Syed Mukarram Ali, Director, Delta Life Insurance Co Ltd, Ms Rokeya Quader, Chairperson, Desh Garments Ltd, Mr. Nasir A Choudhury, Managing Director, Green Delta Ins. Co Ltd., Mr. Iftekhar Uddin, Executive Director, Kay & Que (Bangladesh)Ltd, Mr. Syed Tareque Md. Ali, Managing Director, Modern Industries(BD)Ltd, Mr. Anis A Khan, Managing Director, Mutual Trust Bank Ltd, Mr. Mahboob Uddin Mahmood, Managing Director, Northern Jute Mfg. Co.Ltd, Mr. Mubarak Ali, Managing Director, Olympic Industries Ltd, Mr.A.K.M.Rafiqul Islam FCA, Managing Director, Pragati Insurance Ltd., Mr. M. A. Awal, Chairman & Managing Director, Prime Textile Spinning Mills Ltd, Dr. A.B.M. Haroon, Managing Director, Samorita Hospital Ltd, Mr. Samson H. Chowdhury, Chairman, Square Pharmaceuticals Ltd and Mr. M Shamsur Rahman, Managing Director, Style Craft Ltd.

Stock experts criticise direct listing decision

Stock market experts are strongly opposed to the recent government decision to deprive the established and profit-earning private sector companies of the direct listing opportunities. The decision what they said, would discourage the established private companies to come to the market.

They said it seems like that the government is discouraging the reputed private sector companies to float share when there is a dearth of good scrips.

The Securities and Exchange Commission (SEC) on December 02 last, following a government decision, asked the bourses not to allow companies, other than the state-owned ones, to be listed under direct listing regulations.

It is absolutely a negative decision so far as stock market development is concerned, former Dhaka bourse chief executive officer and professor of Dhaka University Salahuddin Ahmed Khan told the FE.

"The profitable and recognised companies will not be interested to float share without direct listing," he said.

Under the direct listing method, sponsors or the entrepreneurs get the amount raised from the market whereas under initial public offering (IPO) the amount goes to the company.

He said it is discriminatory that the government companies are only allowed to float share under the direct listing method.

The DU professor said the market is not matured enough and the mandatory 40 per cent IPO flotation system may not bring good results.

"Corporate culture is not established in Bangladesh and owners of the companies may not be interested to offload a big chunk of share and may lose the absolute ownership," he explained.

Echoing the same view, stock market expert and professor of economics department of DU Abu Ahmed said 'crude entrepreneurs' may take the advantage of 40 per cent IPO system.

"If company could fulfil its needs by floating 20 per cent of the shares and in that case why should it float 40 per cent?" he questioned.

The government cannot force a company to raise money from the market which it does not need, he said.

"It will also be difficult for big companies, say, which have paid up capital of over Tk 10 billion (1,000 crore), to float shares," he added.

The expert feared that dishonest entrepreneurs may inflate their financial statements to raise money and it can be used for other purposes.

About direct listing, he said, it is a bad decision as it will discourage the reputed companies to come to the market.

"The government could have allowed the direct listing, making the book building method mandatory," he said.

AIMS Managing Director Yawer Sayeed said the decisions are anti-supply and these will obstruct the private sector to float shares.

"The government has failed to differentiate why a company opts for IPO and another company for direct listing," he said.

When a company needs money, it raises the capital through IPO and when entrepreneurs want to sell a part of its ownership with big profit, they opt for direct listing, he explained.

"Usually big companies with reputed brand name and good image want to be listed under direct listing method," he said.

New body of merchant bankers pledges to develop stock mkt

Merchant bankers Saturday formed a new body with a pledge to develop the stock market further, making it as a source of fund for the country's industrialisation.

They said they are committed to work together for taking the market to a new height and will strive to woo more companies to list with the stock market in an effort to bridge gap between demand and supply for the shallow market.

The promises were made after institutionalising the merchant bankers association through first ever election since 1997, the launching year of Bangladesh Merchant Bankers Association (BMBA), which has now 26 members.

An 11-member executive committee under leadership of M Fazlur Rahman, head of invest banking division of AB Bank, was elected.

"As an institution the merchant bankers or the association could not play its due roles for the development of the capital market for several reasons," said Rahman, in his immediate reaction after the election.

"Now we want to contribute developing our stock market. We want industrialisation through capital market, bring more new issues to the market and create a balance between the money market and capital market," he said.

He said the association under the new leadership will closely work with the regulatory body as well as the investors to take the market a new height.

Sheikh Mortuza Ahmed, head of merchant banking division of Prime Bank and who was elected as vice-president of BMBA, said the merchant bankers have no institutional representation in the market, and with the election, representation of the merchant bankers as an institution has been established.

"Now it's the beginning of a new era," he said.

M Abdur Rouf, chief executive officer of ICB Capital Management Limited, has been elected secretary of BMBA, while Abdul Awal, managing director of Bangladesh Mutual Securities Limited, has been elected treasure.

Apart from, Arif Khan of IDLC Finance Limited, Akter Hossain Sannamat of Prime Finance and Investment Limited, Mohammad Ahsanullah of Trust Bank Limited, Mr. A. Malek Shamsher of Lankabangla Finance Limited, Golam Sarwar Bhuiyan of GSP Finance Company Limited, Tapan Krishna Poddar of Alliance Financial Services Limited and Mohammad A Hafiz of AAA Consultants and Financial Advisers Limited have been elected as executive committee members.

OCL to be listed with CSE under book building method

Ocean Containers Limited (OCL), a local enterprise engaged in container business, is going to be listed with the Chittagong Stock Exchange (CSE) under book building method.
This the first time a company will be listed under book building method and it will also be directly listed with the bourse, said its upbeat chairman Muhammad Aziz Khan, also the chairman of Summit Group.
He said it is expected that the listing process to be completed by early December.
The company will offer 5.355 million shares for the general investors and 1.19 million shares for institutional investors, he said.
"We expect that the investors will pay at least Tk 126.58 per share as the company is performing very well," he added.
The face value of per share has been determined at Tk 10 and the company will be allowed to offload 11.9 million shares.
The company received 'A plus' rating for long term and 'ST-2' for short term with its business of inland container depot and container freight station.
Mr Aziz claimed that OCL is the largest off-dock in the country handling 20 per cent of total export volume.
"It handled 61,961 twenty-feet equivalent containers in 2008 and 45,468 TEUs up to September this year," he said.
It earned Tk 109 million net profit in the last year and its net asset value is Tk 1.232 billion.
The OCL chairman said containarised trade will continue to grow as this is the more efficient trend in transportation of goods worldwide.
The company arranged a road show on Monday to demonstrate the performance of the company in front of the investors.
Deputy managing director of OCL Yasser Rizvi in a presentation said the company handled about 300 containers per day.
"It has a long-term contract with Maersk Logistics, which handles 35 per cent to 40 per cent of Bangladesh's total export volume," he said.
It is the first company to have the ISO certification for inland container depot and container freight station services, he added.
A large number of investors, officials from Dhaka and Chittagong exchanges were present at the road show.

GP debuts today

Grameenphone (GP) shares trade begins on Dhaka and Chittagong bourses today.

With this trading debut, the leading mobile phone operator is going to be the largest-ever issue in Bangladesh capital market with its Tk 486 crore initial public offerings (IPO), oversubscribed by more than 3.5 times.

The company had raised this Tk 486 crore from public last month by issuing 6.943 crore ordinary shares of Tk 10 each, in addition to Tk 60 as premium per share.

A total of 277,757 lots of shares were allocated to local investors through lottery, while 34,720 lots went to non-resident Bangladeshis and 24 to mutual funds.

Earlier, the company also raised another Tk 486 crore through pre-IPO or private placement.

According to GP, it will use the proceeds from the issue to expand its network and develop information technology and for corporate purposes.

Norway's telecom giant Telenor owns GP's 62 percent stakes, while the rest is owned by local Grameen Telecom.

GP is the most profitable mobile phone operator in the country, with its revenue expecting to hit billion dollars mark by the year-end.

Investors urge SEC not to appeal against HC verdict

A group of retail investors once again urged the stock market regulator not to appeal against the High Court verdict on the mutual fund case.

They made the plea by submitting a memorandum to the Securities and Exchange Commission yesterday.

Earlier, hundreds of investors took out a procession under the banner Share Market Retail Investors Forum from the Dhaka Stock Exchange building to SEC building.

They said due to the writ petition, mutual funds were not giving dividends for a couple of years now.

The case has now been resolved by the High Court. If the SEC appeals with the Supreme Court, the issue of dividends will remain pending once again, they said.

The High Court on November 8 handed down a verdict allowing closed-end mutual funds to issue bonus or right issues.

After the verdict, SEC said it would appeal to the Supreme Court next.

In yesterday's memorandum, investors also urged SEC to withdraw a ban on margin loan facilities to mutual funds.

On Saturday, investors submitted a memorandum to the prime minister, seeking her intervention in the mutual fund issue.

Investors also said they will submit a copy of the memorandum to the finance ministry today.

Ex-finance adviser against regulator's frequent intervention in stock market

ormer finance adviser Dr Mirza Azizul Islam yesterday said regulatory authorities should not always intervene in the capital market.

“In principle, I'm against intervention in the market, but sometimes it has become investigable to protect people's interest due to various problems,” he said while speaking at the inaugural session of a daylong workshop on capital market.

Economic Reporters Forum (ERF) and Dhaka Stock Exchange (DSE) jointly organised the workshop at the DSE training center. DSE President Md Rakibur Rahman and ERF President Nazmul Ahsan were present at the inaugural session.

Dr Aziz mentioned that the intervention should be made to protect interests of investors and the country.

He, however, said the world recently faced the biggest economic meltdown due to non-intervention and lack of monitoring.

Aziz also advocated parleys with stakeholders before going for any sort of intervention in the capital market.

The former finance adviser criticised the attitude of the government in offloading the state-owned enterprises and said government officials concerned should be motivated in this regard.

“People at the capital market will have to convince the government officials that the offloading of state-owned enterprises would not cut down their authority,” he told the workshop.

Describing the trend of the economies in countries like Bangladesh, the former chairman of the Securities and Exchange Commission (SEC) said banks should play the main role at the initial stage and then the capital market should come to play its part.

He also said many government officials of the country do not have any idea how the capital market could boost the economy by helping the government raise funds.

He said raising funds from the capital market is cost effective than going to banks. “You'll have to shoulder some set liabilities for your bank loans, but you don't need to give dividends despite losses in business.”

Aziz said the country's capital market will develop gradually as the present government is very cordial to do that.

Responding to a question, the former finance adviser said there is no fake share in the capital market right now.

“The present infrastructure of the market is not suitable for the vested quarters to indulge in foul play with fake shares,” he sai

Frequent SEC intervention in share market criticized

ormer Finance Adviser AB Mirza Md Azizul Islam criticised Saturday the role of the Securities and Exchange Commission (SEC) for its excessive intervention on the capital market. He also blasted the government for being indifferent to the need for offloading shares of the corporatised state-owned organisations.
Mirza Aziz termed the present market scenario 'resilient' and sought punitive actions against the individuals involved in the share market scam in 1996.
"The SEC should not intervene on the market regularly," Aziz said as the Chief Guest while inaugurating a
'Orientation Course on Capital Market for Economic Reporters,' held at the Dhaka Stock Exchange (DSE) Training Academy.
"The mechanism for market intervention, if considered inevitable, should be finalized in consultation with stakeholders to avert controversy and choose the right direction,' Aziz, also a former SEC Chairman added.
The day long workshop was jointly organised by the Economic Reporters' Forum (ERF) and the DSE Training Academy. DSE President MD Rakibur Rahman, Professor Abu Ahmed, ERF President Nazmul Ahsan, Executive Directors of SEC Anwarul Kabir Bhuiyan and Farhad Ahmed and ERF General Secretary Sajjad Alam Khan spoke at the occasion.
Mirza Aziz said the market should act on its own without any intervention by the regulatory agency. Regular intervention by the watchdog body harms the normal growth of the market, he added.
Criticising the government, the former finance adviser said the government has no clear idea of the capital market and this has resulted in indifference on the part bureaucrats to the offloading of the shares of the state-owned corporatised bodies.
"I can say for sure that the government has no clear idea about the ways of vitalizing the capital market,'' the former finance adviser said.
"Three state-owned banks, Biman Bangladesh Airlines and BTCL were corporatised during my period as finance adviser so that a considerable portion of their shares are offloaded into the share market,'
"No progress has so far been made to this effect though the incumbent government took the office about one year back.''
Mirza Aziz said the long term investment if made through bank loans would carry potential risks as majority of banks deposits are short-term in nature, which makes maturity mismatch.
He said the potential issuers prefer to bank loans as such loans has no accountability.
Responding to a query, Mirza Aziz admitted that some government officials are protesting the move to offload shares of state-owned enterprises (SOEs) to protect their 'vested' interests.
But they should be aware that they could continue enjoying some privileges even after offloading share of the SOEs, he said.
"A firm intention of the policymakers is necessary to offload SoE shares in the capital market and move forward the country's economy," he added.
The DSE President said the excessive intervention and directives by regulatory authority have been hampering the growth of the capital market.
Rakib said the government is suffering from the lack of coordination in offloading shares of state-owned enterprises and collecting funds from the share market to construct large infrastructure projects.
A section of bureaucrats not having even a minimum knowledge of capital market is acting as barriers to the growth of share market, overtly or covertly, he maintained.
He urged the authorities concerned to settle the litigation at the earliest, terming the Mutual Fund as the important element of the capital market.
Professor Abu Ahmed said both the government and bureaucrats must have clear desire to strengthen the capital market through offloading the shares of government-owned institutions.
Criticising the role of SEC, the capital market analyst said the top bosses of listed companies bracketed in 'Z' category use luxury vehicles, while declaring their companies as loss making.
He said the 'placement business' has emerged in the country in recent times, which should be stopped without further delay.
Anwarul Kabir Bhuiyan said a group of people is spreading the rumour that the face value of issues would be made at Tk 10. This is not true, he added.
"The SEC has not taken any such decision. The issue was only recommended by a body. Its implementation will be a lengthy process and we have many things to examine towards implementing the recommendation," Kabir told the meeting.
A total of 50 ERF members took part at the day-long workshop.

Investors' awareness programmes receive good response

Programmes arranged to create investors' awareness by the Securities and Exchange Commission (SEC) and the Dhaka Stock Exchange (DSE) are now drawing a large number of investors.
Dhaka Stock Exchange (DSE) is also having a similar response from the investors in its 'weekly' and 'monthly' awareness programmes.
"We have limitations and regular office duties. In spite of our daily business we are arranging the programmes. It's not possible to accommodate the all newcomers in the programmes. But there is no cause for frustration as we will continue the programmes year after year," Mansur Alam, a member of the SEC, told the FE Friday.
"After a few days I will go on LPR. Without having prior knowledge I do not want to be involved in the stock market," Zia-ul Hasan, a detective officer who was unable to be enrolled in the SEC awareness programme, told the FE.
"The SEC takes no fees from the participants. Through the regular business we try to make the investors conscious about their investment and the stock market," ATM Tarquzzaman, an executive director of the SEC, told the FE.
"It's a positive sign for our capital market. The more the investors will come to participate in the awareness programmes the more they will be benefited. We will extend the programmes across the country with the stock branches," Rakibur Rahman, president of DSE, told the FE.
"Students and interested persons of different professions and the subscribers of different companies are coming to attend the awareness programmes," the officials of SEC told the FE.
"Every day a large number of subscribers communicate over the telephone and come in person to collect enrolment forms of the programme. Most of the new comers are the subscribers of Grameen Phone, but we are not able to allow them after closing the enrolment procedure," Mahbubur Rahman, a senior officer of SEC, told the FE Thursday.
"Already the vacancies up to next June have been filled. As a result, being frustrated the subscribers are going back," Mahbubur Rahman added.
According to the officials, from January to March of 2009, 152 participants attended the education programme of the SEC. They were taught the relevant laws of stock markets, rules and regulations, the structure of regulatory and surveillance syst

Investors demonstrate against price fall of DSE shares

Dhaka stocks Thursday saw the biggest single-day fall in more than four months amid protests by investors, as retailers took wait-and-see approach ahead of the debut of the country's largest initial public offering, Grameenphone.
The benchmark DSE General Index (DGEN) dropped some 60 points across the board when the trading began, sending scores of angry investors to the streets, but made some recoveries in late hours, led by banking shares.
The DGEN still shed 39.75 points --- it's biggest single-day drop since July 5 when the index lost 103 points --- to close at 3382.87, which is 1.16 per cent down from the previous day.
Police were called in to step up security in front of the DSE trading floors and the Securities and Exchange Commission (SEC) office, as more than 50 investors staged demonstration, demanding easing of lending regulations for securities.
The protesters put up blockade in the Motijheel commercial area for half an hour and marched through the busy streets to the SEC office. Police said they have no report of violence.
The securities regulator last month tightened lending to mutual funds, paper shares and some risky securities in an effort to cool down what it said an 'overvalued' market.
The broader DSE All Shares Price Index (DSI) lost 32.82 points or 1.14 per cent to 2833.35 while DSE-20 blue chips index dropped 12.82 points or 0.55 per cent to 2285.25.
The market was skewed
towards declines as out of 227 issues traded, 67 advanced, 159 suffered losses and one remained unchanged. The turnover declined to Tk 8.90 billion against the previous session's Tk 10.88 billion.
Dealers said the market nose-dived due to the cautious attitude of the investors, as many were waiting in keen anticipation for next week's debut of the Grameenphone, the largest private company in the country.
"Investors, mostly small, sold their shares in a bid to see how the market reacts when Grameenphone (GP) makes its much-talked-about debut on Monday," said a stockbroker, asking not to be named.
"But a late gain by banking shares saved some blushes," he added.
The SEC also discussed GP's debut and its possible impact in the market.
"The commission thinks that there will be no major impact when GP debuts in the market," said a SEC official.
"Still, we shall observe the company's trading for two to three days. We'll be ready for any prompt action if we see any adverse situation," he added.
Shares of the state-owned Power Grid Company topped the turnover list with shares worth Tk 501.90 million changing hands.
It was followed by Titas Gas, AB Bank, Beximco, Jamuna Oil, Bextex, Standard Bank Ltd, Social Investment Bank Ltd, Premier Leasing and Al Arafah Bank.

Singer Bangladesh

Singer Bangladesh Limited has received 'Best Presented Accounts and Corporate Governance Disclosures Awards 2008' as Joint 1st Runner-up under Manufacturing category from South Asian Federation of Accountants (SAFA), an apex body of SAARC.
Managing Director & CEO of Singer Bangladesh Limited and Regional Vice President of Singer Asia Limited Mr. A.M. Hamim Rahmatullah received the prestigious award from Finance Minister Mr. Abul Maal Abdul Muhith at a function on November 5, 2009 at Bangabandhu International Conference Centre in the city.
The award is conferred on the basis of evaluation administered by SAFA's Committee for Improvement in Transparency, Accountability and Governance of the published annual reports of entries from South Asian countries.
Meanwhile, Prime Bank Limited has been awarded SAFA Best Bank-2008 on the basis of evaluation of annual report.
Finance Minister Abul Maal Abdul Muhith presented an award as the chief guest to the Managing Director M Ehsanul Haque at a function.

GP coming on Sunday

Grameenphone shares will hit the prime bourse on Monday Nov 16, as the largest issue in the country's history, the Dhaka Stock Exchange president said Wednesday. Rakibur Rahman told that the date was fixed at a DSE board meeting Wednesday.

Chittagong Stock Exchange is also likely to start trading of the scrip the same day, though officials could not confirm. The port city bourse authority handed GP the listing confirmation letter Wednesday at its Dhaka office.

There had been widespread speculation the issue would start trading from Sunday Nov 15.

"We are all set to start from Sunday but if GP wants, we will start on Monday," AKM Shahroze Alam, manager of CSE's corporate development wing

NRBs asks for larger IPO quota

Dhaka, Nov 9 (bdnews24.com) – A visiting delegation of the British Bangladesh Chamber of Commerce has requested a larger quota of initial public offerings in the local capital market for non-resident Bangladeshis.

The BBCC delegation sought the facility in a meeting with finance minister AMA Muhith at his office on Monday.

At present, 10 percent of shares through IPOs are set aside for NRBs and another 10 percent for mutual funds.

"Participation of NRBs in Bangladesh's capital market has risen greatly in recent years. So, we're asking for an increase of the currently stipulated 10 percent," chamber president Shahagir Bakht Faruk said in the meeting.

The matter would be considered if the demand was high, Muhith said.

The minister also urged them to invest in gas and power, transportation, health and education under the Public Private Partnership (PPP) initiative, citing scope of high profits in those sectors.

The 15-member BBCC delegation arrived in Dhaka Saturday on a four-day trip to explore sectors suitable for investment in Bangladesh and products that would interest the British market

The delegation has said it sees "huge potential" for business and investment in Bangladesh, as long as the government can ensure the proper investment climate.

"Most of our delegates are British citizens of Bangladeshi origin," chamber chief Faruk told a press conference on Sunday.

"Therefore, they all have a special feeling about the home country. We are trying to find ways to build more trade and commerce between Britain and Bangladesh."

The businessmen said they were looking at shipping, hospitality, fashion, medical facilities, consultancy, education and housing.

The BBCC are already invested in a number of projects in Bangladesh.