Trading of Walton Hi-Tech Industries’ stocks on its debut came to a halt at a point yesterday due to an absence of sellers amidst high demand from general investors along with a regulatory bar aimed at preventing prices from skyrocketing on the first day.
As per a directive of the Bangladesh Securities and Exchange Commission (BSEC), a stock will be allowed to rise by 50 per cent from the issue price on its market debut and the next day another 50 per cent from the debut’s closing price.
The flotation witnessed Walton’s stock rise 50 per cent to Tk 378 and the company accumulated a paid-up capital of Tk 302 crore.
Walton has raised Tk 100 crore in funds from the capital market to expand its business and repay bank loans.
However, there were few sellers compared to buyers, for which its trade came to a halt at one point.
The company’s offer price, Tk 252, would be its floor price, as stipulated by the BSEC for debuts.
The regulator set the floor price for every stock in March in order to stop a slump amidst the coronavirus pandemic.
The company’s potential at making earnings created the demand among investors, said a stock broker with two decades’ experience.
The company has been logging higher profits for the last couple of years and its business is growing at a good rate, he said.
The producer of electrical and electronic goods disclosed its financial report for the third quarter of fiscal 2019-2020.
Its profit stood at Tk 155 crore while basic earnings per share Tk 5.17 whereas it was Tk 334 crore and Tk 11.14 respectively in the same period the previous year.
The profit of the three quarters combined reached Tk 766 crore against Tk 726 crore year-on-year.
Despite the spread of the pandemic, the local electronics giant witnessed profits which lured investors into pouring money into the stocks, the stock broker added.
Meanwhile, the stock market bounced back after a fall for four consecutive days.
The DSEX, the benchmark index of the DSE, rose 16 points, or 0.32 per cent, to 4,986.37 yesterday.
Of the 356 stocks traded, 215 advanced, 89 declined, and 52 remained unchanged.
Turnover, another important indicator of the DSE, surged around 21 per cent to Tk 881.8 crore.
Nitol Insurance grew 9.86 per cent to Tk 55.7 which topped the DSE’s gainers’ list followed by Global Insurance, Paramount Insurance, Salvo Chemical and Federal Insurance.
Beximco Pharmaceuticals topped the turnover list with trades worth Tk 28 crore followed by DBH, Beximco, Rupali Insurance and Sandhani Insurance.