Share prices of 4 firms shifted from OTC market rises abnormally

Shares of four companies, which recently returned from the over-the-counter or OTC market to the main board saw unusual rises.

The companies are Bangladesh Monospool Paper Manufacturing, Paper Processing and Packaging, Tamijuddin Textile Mills and Monno Fabrics.

The companies were in the OTC market for a long time due to the weak financial conditions. On June 13, 2021, Dhaka Stock Exchange (DSE) brought the companies back to the main market.

From June, 13 to July, 15, the shares of Bangladesh Monospool Paper increased by 1138 percent, Paper Processing by 1113 percent, Tamijuddin Textile by 783 percent and Monno Fabrics by 161 percent.

Capital market expert Abu Ahmed told Business Insider Bangladesh that the way the prices of the four companies have been rising is quite unusual.

He said the companies had not made any big profits according to its latest financial reports. The BSEC should investigate whether there is any manipulation behind the spiralling shares of the companies.

According to the DSE, Paper Processing earnings per share (EPS) in the third quarter (January to March ‘21) was Tk 1.17, which was Tk 0.44 in the same period a year earlier.

During the period, Monno Fabrics’ EPS stood at Tk 0.01 from Tk 0.02, Monospool Paper’EPS at Tk 1.37 from Tk 0.28, and Tamijuddin Textile’s EPS at Tk 0.11 from Tk 0.98.

DSE Director Shakil Rizvi said that the rise of a weak company’s shares was not normal.

He said investors should be careful about these companies and not give ears to the rumors.

The four companies were delisted from the main market in 2009 for failing to pay dividends to investors years after years.

The securities regulator BSEC recently allowed some weak performing companies to return to the main market after scrutinising their financial health.

Apart from the four companies, Sonali Paper was transferred to the main market from the OTC market.