The capital market regulator has failed to recognise the reasons why the price of a company’s share is shooting through the roof while the market is going downhill.
The company, JMI Syringe, has itself been taken by surprise. Its officials say they are unaware of what is pushing the share prices up.
JMI Syringe shares sold at around Tk 38 when the company listed on the Dhaka Stock Exchange in June.
But the prices soared to a dizzy Tk 300 on Sept 17, dropping to Tk 282 on Wednesday following investigations into the phenomenal increase.
Market experts suspect manipulation, saying the current share price did not match the comany’s fundamentals.
Yawer Sayeed, the Chief Executive Officer of AIMS of Bangladesh Ltd, an asset management company, told bdnews24.com: “JMI Syringe share prices have increased because of manipulation.”
Dhaka University Accounting Department Professor Mizanur Rahman echoed him. “The price of JMI Syringe share can be Tk 70 at best,” he said.
Company Secretary of JMI Syringe Tareque Hossain, however, pleaded ignorance of the reasons behind the price spiral.
Speaking to bdnews24.com, he said: “Apart from the usual business activities, there is no new information about our company. There is no reason for such a sudden rise in the price.”
According to DSE, JMI Syringe earned around Tk 1 profit per share in the first six months of the current year. According to the company’s audit report last year, its asset value per share was Tk 44.61.
A senior official of the Bangladesh Securities and Exchange Commission (SEC) said the case was being investigated.
The official, who chose to remain anonymous, told bdnews24.com: “We’re working. We’ve formed a probe committee on JMI Syringe’s share price increase… The relevant departments will take measures in this regard.”
Yawer Sayeed blamed SEC’s inaction for what appeared to be a recurrence of share price manipulation.
Prof Mizanur said the SEC had failed to control the market. “No actions are in sight, though share prices are being raised through serial trading.”
“In the US, those guilty of such manipulations are jailed for 24 years. But nothing happens (to manipulators) in Bangladesh.”
Source: Bd news24