Tuesday, September 16, 2014

Fair to popularise CSE's online trading platform

Daily Star - 16 September'2014 Tuesday
The Chittagong Stock Exchange is set to organise a two-day fair next month to promote its internet trading platform, which is yet to gain popularity almost ten years after its launch.
Mock transactions through the bourse's internet trading system will be showed to the investors, who can also participate in the trading, said Syed Sajid Husain, managing director of CSE.
Husain's comments came at a media briefing organised at the bourse's Dhaka office yesterday as part of its plan to hold regular briefings on the first and third Mondays of each month.
Stalls will be also be kept at the ITS fair for the CSE TREC (trading right entitlement certificate) holders, different IT firms and financial institutions.
The bourse also plans to introduce three new indices -- shariah index, IPO index and benchmark index -- as part of its business plan under demutualisation era.
The CSE is in talks with the National Stock Exchange of India, who will make a presentation on the indices at the Bangladesh Securities and Exchange Commission by the end of this month.
Husain said the bourse is looking for strategic partners, in line with the demutualisation scheme that separated the exchanges' management from ownership to bring transparency and accountability to the market.

For that end, CSE is communicating with institutions, mostly from abroad.
The CSE chief said the country's capital market is mainly equity-based and it is not possible to create a rich stockmarket only based on equity securities.
Diversified products such as derivatives are essential to make a stockmarket rich, he added.
Replying to queries, he said although the stock exchanges are considered primary regulators, they cannot take actions against irregularities especially in case of listing due to limitations in rules and regulations.
“We have brought many changes in the listing regulations and submitted these to the BSEC for regulatory approval,” he said, adding that the modifications will allow the bourse to take actions against the issuer companies or auditors or the issue managers.
Although there is a regulatory provision for listed companies for maintaining websites, there are many firms whose websites are either temporarily down or under construction, he said.
There is also lack of seriousness among the stock exchanges to supervise the compliance of the regulatory directive, Husain added.
Published: 12:00 am Tuesday, September 16, 2014

Stocks inch down on profit-taking sales after four-day rise

New Age - 16 September'2014 Tuesday


Dhaka stocks inched down on Monday after rising in last four trading sessions with declined turnover amid investors’ profit taking share sell-offs.
The key index of Dhaka Stock Exchange, DSEX, finished negative at 4,709.91 points, shedding 0.07 per cent or 3.66 points.
The DSEX has gained 104.63 points in last four days.
Due to the recent increase in share prices, investors on the day opted to realize some profit which was the main reason behind the day’s negative ending, market operators said.
Along with the retail investors, institutional investors increased share selling ahead of the third quarter ending which might have been another reason behind the negative ending, they said.
Operators, however, also said that the day’s negativity might not prolong as fresh fund injection from different section of investors continued, they said.
DS30, the blue-chip index of DSE, however, finished positive at 1,818.97 points, adding 0.22 per cent or 4.10 points.
The Shariah index of the bourse, DSES, fell by 0.17 per cent, or 1.90 points, to close at 1,110.72 points.
The turnover of the bourse declined to Tk 668.90 crore on Monday compared with that of Tk 838.18 crore in the previous trading session.
Of the 300 shares and mutual funds traded on the day, 83 advanced, 172 declined and 45 remained unchanged.
‘Market slowed a bit on Monday after last few days’ buying spree amid profit booking and sector reallocation by the investors,’ IDLC Investments said in its daily market commentary.
‘However, DSEX sustained above 4,700.0 points psychological level, closing flat at 4,709.9,’ it said.
‘Turnover also dropped significantly to BDT 6.7 bn, which was around 20 per cent down in comparison to the last day,’ it said.
‘Out of 300 traded stocks, only 16 posted more than 3.0 per cent gain, whereas 52 lost more than 3.0 per cent from the previous day,’ IDLC said.
MJL Bangladesh led the turnover chart as its shares worth Tk 44.51 crore changed hands.

 

Dhaka stocks inched down on Monday after rising in last four trading sessions with declined turnover amid investors’ profit taking share sell-offs.
The key index of Dhaka Stock Exchange, DSEX, finished negative at 4,709.91 points, shedding 0.07 per cent or 3.66 points.
The DSEX has gained 104.63 points in last four days.
Due to the recent increase in share prices, investors on the day opted to realize some profit which was the main reason behind the day’s negative ending, market operators said.
Along with the retail investors, institutional investors increased share selling ahead of the third quarter ending which might have been another reason behind the negative ending, they said.
Operators, however, also said that the day’s negativity might not prolong as fresh fund injection from different section of investors continued, they said.
DS30, the blue-chip index of DSE, however, finished positive at 1,818.97 points, adding 0.22 per cent or 4.10 points.
The Shariah index of the bourse, DSES, fell by 0.17 per cent, or 1.90 points, to close at 1,110.72 points.
The turnover of the bourse declined to Tk 668.90 crore on Monday compared with that of Tk 838.18 crore in the previous trading session.
Of the 300 shares and mutual funds traded on the day, 83 advanced, 172 declined and 45 remained unchanged.
‘Market slowed a bit on Monday after last few days’ buying spree amid profit booking and sector reallocation by the investors,’ IDLC Investments said in its daily market commentary.
‘However, DSEX sustained above 4,700.0 points psychological level, closing flat at 4,709.9,’ it said.
‘Turnover also dropped significantly to BDT 6.7 bn, which was around 20 per cent down in comparison to the last day,’ it said.
‘Out of 300 traded stocks, only 16 posted more than 3.0 per cent gain, whereas 52 lost more than 3.0 per cent from the previous day,’ IDLC said.
MJL Bangladesh led the turnover chart as its shares worth Tk 44.51 crore changed hands. - See more at: http://newagebd.net/49624/stocks-inch-down-on-profit-taking-sales-after-four-day-rise/#sthash.tfyf47l9.dpuf

CSE to hold Internet Trading Fair in October

FE Report - 16 September'2014 Monday
The Chittagong Stock Exchange (CSE) will organise a two-day fair on stock trading through internet, titled Internet Trading Fair, by the end of next month to make internet trading popular among investors.

CSE managing director Syed Sajid Husain disclosed this at a press briefing at the bourse's Dhaka office, organised in line with its plan of holding regular briefings on every first and third Monday of each month.

He said the internet trading system (ITS) is yet to get popularity among the investors though CSE launched the service in 2004. Mock transactions through the bourse's ITS will be showed to the investors at the fair.

"Now-a-days, most of the investors have smart-phone. One can trade from his home or wherever he is using smart-phone, laptop, IPAD or computer."

He said stalls will be kept in the fair for the CSE TREC (trading right entitlement certificate) holders, different IT firms and financial institutions.

About the strategic partners of the demutualised stock exchange, he said they are still looking for potential strategic partners for the bourse, mostly overseas, in line with its demutualisation scheme.

As per the demutualisation scheme, approved by the Bangladesh Securities and Exchange Commission (BSEC) on September 26, 2013, the board of the exchange will comprise of 13 members.

Presently, the post of strategic partner remains vacant, and it is running with 12 members.

Mr Sajid also informed that the port-city bourse is also working for introduction of three indices - CSE benchmark index, CSE IPO index and Shariah index - as part of its business plan.

"We are holding talks with the National Stock Exchange (NSE) of India, and a team of NSE will make a presentation on the indices to the securities regulator by the end of this month."

Mr Sajid said Bangladesh stock market is mainly equity-based, and it is not possible to develop a rich capital market depending on equity only.

"Diversified products, such as - derivatives, are essential to make a stock market vibrant."

Replying to queries, he said although the stock exchanges are considered as primary regulators, they cannot take actions against irregularities, especially in listing, due to various limitations in rules and regulations.

The CSE MD said they have already sent a proposal to the securities regulator for changing the existing listing regulations, and it is now under consideration of BSEC. The modifications will allow the bourses to take actions against issuer companies or auditors or issue managers.

He also said although there is a regulatory provision for maintaining websites by the listed companies, there are many firms whose websites are either temporarily down or still under construction.

"There is also lack of seriousness among the stock exchanges to supervise compliance of the regulatory directives."

Mr Sajid stressed the need for investors' education for the sake of minimising their investment risks. He urged the government to include the stock market-related topics in textbooks of various levels.

The asset management companies should also organise awareness programmes for creating demand for mutual funds and making these popular among the investors, he added.

Stocks return to the slow lane

FE Report - 16 September'2014 Monday
Stocks returned to the red Monday after four consecutive sessions of gains, with turnover dropping significantly as investors went for quick profit booking.

The market started with an upbeat note, but late hours profit booking sale wiped out early gains. Eventually, DSEX, the prime index of the Dhaka Stock Exchange (DSE), ended at 4709.91 points, shedding 3.66 points or 0.07 per cent.

The DSE Shariah Index dropped by 1.90 points or 0.17 per cent to close at 1,110.72. However, the DS30 comprising blue chips remained positive and closed at 1,818.97 points, gaining 4.10 points or 0.22 per cent.

The total turnover on DSE slumped to Tk 6.68 billion, registering a decline of 20.28 per cent over the previous session's seven and a half month high turnover of Tk 8.38 billion.

The investors' attention was mostly concentrated on fuel and power, pharmaceuticals and engineering - the sectors that accounted for 19 per cent, 16 per cent and 12 per cent respectively of the week's total turnover.

"The market saw mild correction as investors went for some quick profit booking," commented LankaBangla Securities, in its regular market analysis.

Intra-day price volatility of actively traded stocks has been observed. Trailing market price earning (PE) ratio stood at 16.04 on Monday, said the stock broker.

 "Market slowed a bit after last few days' buying spree amid profit booking and sector reallocation by the investors," commented IDLC Investments

Out of 300 traded stocks, only 16 posted more than 3.0 per cent gain, whereas 52 lost more than 3.0 per cent from the previous day, said the merchant bank.

"The weakness that emerged on DSE was partly due to profit taking following the recent strength in the markets," said Sheltech Brokerage.

Among the large cap sectors, non-banking financial institutions were the only sector which closed lower with 0.24 per cent loss.

All other major sectors appreciated. Telecommunication gained the most with 1.24 per cent gain. Pharmaceuticals, food and allied and fuel and power sectors went up by 0.31 per cent, 0.82 per cent and 0.19 per cent respectively. Banks closed flat with 0.06 per cent gain.

Losers outpaced gainers as out of 300 issues traded, 172 declined, 83 advanced and 45 remained unchanged on the DSE trading floor.

Activities decreased in the major bourse (DSE) where trade and volume were down by 18.57 per cent and 18.50 per cent respectively. A total of 0.127 million trades were executed with 125.61 million securities of trading volume.

The total market capitalisation of the DSE stood at Tk 3,189.68 billion against Tk 3,187.69 billion in the previous session.

MJL BD was the day's most traded stocks for the second running sessions with shares worth Tk 445.14 million changing hands followed GP, Beximco Pharma, Padma Oil and BSRM Steels.

Safko Spinning was the day's highest gainer for the third day, posting a rise of 8.0 per cent while Rupali Life Insurance was the day's worst loser, slumping by 6.93 per cent.

The port city bourse, Chittagong Stock Exchange (CSE) also closed marginally lower with its Selective Categories Index - CSCX - lost 8.41 points to close at 8,800.62 points.

Losers beat gainers 141 to 64, with 30 issues remaining unchanged at the port city bourse that traded 9.50 million shares and mutual fund units, turnover value of Tk 417.17 million.

Monday, September 15, 2014

Public Issue Application Process (Pilot Project for other than Non-resident Bangladeshi and Foreign applicants)


The pilot project is for specific IPO to be subscribed from September, 2014. This is optional for investors, i.e. investors can apply either following new process through stockbroker/merchant banker or in existing process through banker to the issue.
During pilot project, the full process and timeframe cannot be followed. The application shall be received during the subscription period only as declared by the issuer. Existing lottery related activities and reporting requirements shall be maintained.
Submission of application, deposit and refund of application money and issuance of allotment letters shall be performed as per the new process.

Step-1 (Applicant)
1. Applicants other than Non-resident Bangladeshi (NRB) and Foreign applicants for public issue of securities shall submit application/instruction, within the subscription period, to the Stockbroker/ Merchant Banker where the applicant maintains BO account.
2. The application/instruction may be submitted in prescribed paper or electronic form, which shall contain the Customer ID, Name, BO Account Number, Number of Securities applied for, Total Amount and Category of the Applicant. At the same time the applicant shall make the application money available in respective customer account maintained with the Stockbroker/Merchant Banker. No margin facility, advance or deferred payment is permissible for this purpose. Application/instructions shall be preserved by the same Stockbroker/Merchant Banker up to 6 months from listing of the securities with exchange.

Step-2 (Intermediary)
3. The Stockbroker/Merchant Banker shall maintain separate bank account only for this purpose namely “Public Issue Application Account”. The Stockbroker/Merchant Banker shall verify the availability of fund and if find in order, block the customer account for an amount equivalent to the application money, accumulate all the buy instructions received up to the subscription closing date, deposit the amount in the “Public Issue Application Account” maintained with its bank, instruct the banker to block
the account for an amount equivalent to the aggregate application money and to issue a certificate in this regard. In case of application submitted by the Stock-dealer or the Merchant Banker‟s own portfolio, the application amount should also be transferred to the “Public Issue Application Account”.
4. Banker of the Stockbroker/Merchant Banker shall block the account(s) as requested for, issue a certificate confirming the same and provide it to the respective Stockbroker/Merchant Banker. The Stockbroker/Merchant Banker shall prepare category wise lists of the applicants containing Customer ID, Name, BO Account Number and Number of Securities applied for, and within 03 (three) working days from the subscription closing date, send it to the issuer both in electronic (text format with tild „~‟ separator) and printed format along with the certificate(s) issued by its banker.

Step-3 (Issuer)
5. The issuer shall prepare consolidated list of the applications and send the applicants‟ BOIDs in electronic (text format with tild „~‟ separator) format in a CDROM to CDBL for verification. CDBL shall verify the BOIDs as to whether the BO accounts of the applicants are active or not. Along with the verification report, CDBL shall provide the issuer with an updated database of the applicants containing BO Account Number, Name, Addresses, Parents‟ Name, Joint Account Information and Bank Account Information. After receiving verification report and information from CDBL, the issuer shall scrutinize the applications, prepare category wise consolidated lists of the valid and invalid applications, submit status reports of subscription to the Commission and the stock exchanges and conduct lottery in line with the conditions of the consent letter.
6. Within 02 (two) working days of conducting lottery, the issuer shall:
a. send the lists of the successful and unsuccessful applicants (other than NRB and foreign) in electronic (text format with tild „~‟ separator) and printed format to the Stockbroker/Merchant Banker and request them to remit the amount of successful applicants to the issuers respective Escrow Account opened for subscription purpose and unblock the amount of unsuccessful applicants.
b. issue allotment letters in the names of successful applicants in electronic format with digital signatures and send those to respective Stockbroker/Merchant Bankers. To credit the allotted shares to the respective BO accounts, the issuer shall send consolidated allotment data (BOID and number of securities) in text format in a CDROM to CDBL.

Step-4 (Intermediary)
7. On the next working day of receiving the documents from the issuer and issue manager, the stockbroker/Merchant Banker shall request its banker to release the amount blocked for unsuccessful applicants (other than NRB and foreign) and remit the aggregate amount of successful applicants deducting service charge to the „Escrow‟ account of the issuer opened for the subscription purpose.
8. On the next working day of receiving request from the Stockbrokers/Merchant Bankers, their bankers shall unblock the amount blocked in the account(s) and remit the amount as requested for to the issuer‟s „Escrow‟ account. Simultaneously, the stockbrokers/Merchant Bankers shall unblock the customer accounts; inform the successful applicants about allotment of securities and the unsuccessful applicants about releasing their blocked amounts. The unblocked amounts of unsuccessful applicants shall be placed as per their instructions.

Miscellaneous:
9. Stockbroker/Merchant Banker shall execute necessary changes in their back office software to implement the process smoothly.
10. The issuer and Issue Manager(s) shall jointly ensure compliance of the above.
11. The Stockbroker/Merchant Banker shall be entitled to service charge at a rate of 0.05% on the total amount of application money received by them. The service charge shall be paid by the issuer and deducted by the Stockbroker/Merchant Banker from the amount of successful applicants while remitting to the issuer. The Stockbroker/Merchant Banker shall provide the issuer with a statement of the remittance amount and the processing fee.

Source : www.dsebd.org

DSE turnover hits Tk 800cr mark after seven months

New Age - 15 September' 2014 Monday


Dhaka stocks advanced for the fourth trading session on Sunday, the first working day of the week, with the turnover of the bourse hitting seven-and-half-month high as injection of fresh funds continued.
The turnover of the bourse increased significantly to Tk 838.18 crore on Sunday.
Sunday’s turnover was the highest after Tk 856.98 crore on January 30 this year.
The market continued to rise further with increased turnover as injection of fresh funds from different section of investors continued, market operators said.
Despite the decline in most of the traded shares, the market increased on the day as share prices of large capitalised companies’ increased, they said.
Decline in bank deposit rate in the recent time also diverted funds from the banking sector to the capital market which might be the main reason behind the recent price hike, they said.
Absence of political agitation in recent weeks might be another reason behind investors’ optimistic participation on the trading floor, they said.
The key index of the bourse, DSEX, increased by 0.80 per cent, or 37.66 points to close at 4,713.58 points on the day after it was at 4,749.86 points on February 27 this year.
DS30, the blue-chip index of the bourse, closed at 1,814.86 points, increasing by 1.58 per cent or 28.28 points.
The Shariah index of the bourse, DSES, rose by 1.02 per cent, or 11.30 points, to close at 1,112.62 points.
Of the 301 shares and mutual funds traded on the day, 125 advanced, 147 declined and 29 remained unchanged.
‘Investors’ confidence as well as injection of fresh funds continued the market momentum for the fourth consecutive session,’ IDLC Investments said in its daily market commentary.
‘Riding on strong participation, the benchmark DSEX broke through 4,700 points mark after four and half months and closed the session at 4,713.5, adding 37.6 points,’ it said.
‘Turnover also crossed Tk 800 crore mark after seven months, which was 22.20 per cent higher than the last session,’ it said.
MJL Bangladesh led the turnover chart on the day as its shares worth Tk 76.37 crore changed hands.
BSRM Steels, Lafarge Surma Cement, ACI Limited, BEXIMCO, Delta Life Insurance, Grameenphone, Aamra Technologies, Singer Bangladesh and Heidelberg Cement were among other turnover leaders.
Delta Life Insurance gained the most on the day as its share prices increased by 9.96 per cent, while FAR Chemical Industries lost the most shedding 19.88 per cent.

 

CSE announces gifts for top traders - Experts warn the move may provoke aggressive trading

New Age - 15 September' 2014 Monday


HM Murtuza
The Chittagong Stock Exchange has declared incentives for investors based on their turnover through the bourse’s internet trading service that may provoke aggressive trading.
Capital market experts said that the Bangladesh Securities and Exchange Commission should examine the legal aspect of the matter.
The CSE last week announced that the bourse would award laptops to top three investors on the basis of total ITS turnover from September to December, 2014.
The bourse also declared three nights and four days visit to Thai Stock Exchange of Thailand for top 10 brokers who will achieve a minimum turnover of Tk 160 crore in the four months.
Top five brokers based on their turnover through the bourse’s internet trading service will be awarded five latest model laptops, the CSE announcement said.
BSEC officials said that the bourse was yet to take any regulatory approval in this connection.
Any such business promotion activity, if the securities rules permit, has to be launched after getting consent from the regulators, they said.
They said that the BSEC was yet to check the legal aspect of such activities.
Former BSEC chairman Farook Ahmed Siddiki told New Age, ‘The step of the bourse is not fair as it may provoke investors into trading aggressively.’
He said, ‘The capital market regulator should examine the matter.’
AIMS of Bangladesh managing directors Yawer Sayeed told New Age that as the bourse was passing tough time in terms of making profit, it could declare incentive for its brokers.
‘The idea of offering incentives or gift by any stock exchange for investors based on their turnover is not acceptable,’ he said.
The capital market regulator should take the matter into consideration for examining its legal aspect, he said.
Asked, CSE managing director Syed Sajid Husain told New Age that the bourse made the move in a bid to gear up its business and profitability.
As the bourse turned into a profit-oriented organisation after the demutualisation, the initiative was taken, he said.
BSEC executive director Saifur Rahman said, ‘We will check the legal aspect of the issue.’
 

DSE index crosses 4700-point mark

FE report - 15 September' 2014 Monday
The benchmark price index of Dhaka Stock Exchange (DSE) crossed 4700-point mark after four and half months when the two selective indices refreshed their position to the peaks. DSEX closed on Sunday at 4713.58 with a gain of 37.66 points on revitalised investors' confidence when they injected fresh fund to continue the market momentum for the fourth consecutive session. This was the highest gain in a single day, according to a news agency.

Fresh funds in stocks buoy turnover to 7-month high

Daily Star - 15 September' 2014 Monday

Turnover on the Dhaka Stock Exchange reached Tk 838 crore, a seven-month high, as investors yesterday injected fresh funds into stocks amid growing confidence.
DSEX, the benchmark general index of the DSE, gained 37.66 points or 0.80 percent, to close at 4,713.58 point, the highest in four and a half months.
The shariah index of Dhaka bourse, DSES, went up 11.30 points or 1.03 percent, to close at 1,112.62.
Market turnover rose 22 percent from the previous day as some large-cap stocks from oil, pharma and cement saw vast buying interests, said LankaBangla Securities.
“Investors' confidence as well as injection of fresh funds continued the market momentum for the fourth consecutive session,” said IDLC Investments. Large-cap shares continued to charm the investors, the investment bank said.
Among the mostly traded sectors: information technology generated the highest return of 4.5 percent followed by cement with 3.9 percent, engineering 2.4 percent and tannery 1.6 percent.
A total of 1.57 lakh trades were executed, with 15.41 crore shares and mutual fund units changing hands on the premier bourse.
Of the 301 issues that traded on the DSE, 125 advanced, 147 declined and 29 remained unchanged.
MJL Bangladesh was the most liquid stock of the day, with 58.89 lakh shares worth Tk 76 crore changing hands, followed by BSRM Steels, Lafarge Surma Cement and ACI.
Most of the life insurances' share also saw a price hike with Delta Life Insurance leading as the gainers' chart with its 9.96 percent rise, followed by Popular Life Insurance at 9.84 percent, Sandhani Life Insurance 9.78 percent and Rupali Life Insurance 9.33 percent.
Far Chemical Industries was the worst loser, plunging by 19.88 percent.
Chittagong Stock Exchange also gained yesterday with its selective categories index, CSCX, edging up 51.18 points to close at 8,809.
Losers took a strong lead over gainers with 125 to 87, while 17 issues remained unchanged on the port city bourse that traded 1.11 crore shares and mutual fund units with Tk 52 crore in turnover.
Published: 12:00 am Monday, September 15, 2014

Saturday, September 13, 2014

DSE will remain closed for 9 days from Oct 3

FE Report - 12 September'2014 Friday
Share trading and official activities at Dhaka Stock Exchange (DSE) will remain closed for nine days from October 3, 2014, on the occasion of Eid-ul-Azha, including weekly holidays, officials said.

The decision was taken at the 778th DSE board meeting held Wednesday at the DSE board room presided over by its Chairman Justice Siddiqur Rahman Miah, said a DSE press statement.

According to the DSE statement, Eid vacation will begin from October 5 and continue till October 9. But October 3, 4, 10 and 11 fall in weekend, which mean the total vacation will be nine days.

DSE Deputy General Manager (Public Relations & Publications) M Shafiqur Rahman in a press statement said Thursday.

Trading and official activities will also remain closed at the Chittagong Stock Exchange (CSE) during these holidays, said a CSE official.

The normal trading and official activities at DSE will resume from October 12, 2014, said the DSE statement.

Stock market extends gaining streak

FE Report - 12 September'2014 Friday
The stock market extended the gaining streak for the third running session Thursday with turnover improved further as investors continued focus on micro-cap and large-cap stocks.

DSEX, the prime index of the Dhaka Stock Exchange (DSE) went up by 12.78 points or 0.33 per cent to close at almost five-month high level of 4,675.91 points since April 24, this year.

The other two indices also ended higher. The DS30, comprising blue chips gained 9.31 points or 0.52 per cent to close at 1,786.57 points. The DSE Shariah Index went up by 5.32 points or 0.48 per cent to close at 1,101.31 points.

Trading at DSE remained vibrant. The total turnover amounted to Tk 6.86 billion, registering an increase of 7.85 per cent over the previous session's value of Tk 6.36 billion.

Pharmaceuticals, power and engineering stocks grabbed the investors' attention - accounted for 16 per cent, 16 per cent and 15 per cent respectively of the day's total turnover.

"On last day of this week market edged up again to a new high in last three months popping up close to the strong resistance level of 4,700 points," commented LankaBangla Securities, in its regular market analysis.

Market is appeared to be growing at two speeds- sector specific manufacturing stock is generating return on cue of growth in stocks and fresh position on new stocks, said the stock broker.

Market has shown strong participation with turnover value improved further. Among the major sectoral return, cement, engineering and tannery gained 1.7 per cent, 1.5 per cent and 1.0 per cent respectively.

IDLC Investments said: "Closing session of the week ended green with investors' prolonging tilt to micro-cap and large-cap stocks".

Investors' continued position in blue chip stocks assisted DS30 to make another highest point of 1,786.6, to record 21.8 per cent return till its inception, said the merchant bank.

"The market is in a strong impulsive mood, getting support from massive volume," said Zenith Investments.

There is a potpourri of beliefs and emotions from investors as optimism replaces worries, with data seemingly pointing towards bullish trend, said the Zenith analysis.

"Investors should keep this point in check, and make investments decisions accordingly," the Zenith analysis added.

Gainers outpaced losers as out of 300 issues traded, 133 gained, 127 declined and 40 remained unchanged on the DSE trading floor.

Activities increased in the major bourse (DSE) where trade and volume were up by 2.41 per cent and 10.02 per cent respectively. A total of 0.135 million trades were executed with 151.58 million securities of trading volume.

The total market capitalisation of the DSE stood at Tk 3,169.16 billion against Tk 3,162.34 billion in the previous session.

MJL BD was the day's most traded stocks with shares worth Tk 570.75 million changing hands followed by ACI Formulations, Beximco, Delta Life Insurance and Lafarge Surma Cement.

ACI Formulations was the day's highest gainer for the third day, posting a rise of 9.95 per cent while newly listed Shurwid Industries was the day's worst loser, slumping by 10.64 per cent.

The port city bourse, Chittagong Stock Exchange (CSE) also closed marginally higher with its Selective Categories Index - CSCX - gained 8.40 points to close at 8,757.85 points.

CSE for introduction of clearing company and derivatives mkt

FE Report - 12 September'2014 Friday
Asian Development Bank (ADB) Thursday sat with the Chittagong Stock Exchange (CSE) to exchange their views in a bid to implement the latest Capital Market Development Project-III (CMDP-III), officials said.

A delegation of ADB's consultative firm Aries Group held a meeting with the CSE at its Dhaka office.

The delegation of the Aries Group included its director Anthony B. Shoraka and senior consultant Lewis J. Mendelson.

On the other hand, the CSE Chairman Muhammad Abdul Mazid and managing director Syed Sajid Husain attended the Thursday's meeting.

The CSE officials said ADB is evaluating their previous two projects such as CMDP-I and CMDP-II by talking to the exchanges.

"While evaluating their previous two projects, the ADB is also taking our observation on as to how the CMDP-III can be implemented," the CSE managing director Mr. Sajid told the FE after holding Thursday's meeting.

He said at the meeting the CSE has stressed the need of investors' education for the sake of minimising their investment risks.

"We said education service for investors should be introduced by appointing investment advisor," Sajid said.

At the meeting, the CSE put emphasis on a complete road map for the introduction of clearing corporation and derivatives market.

Tuesday, September 9, 2014

Non-banks hit a rough patch Fierce competitive, low demand put their profitability at stake

Daily Star  - 09 September '2014 Tuesday
Sajjadur Rahman
Profitability of non-bank financial institutions is shrinking though their management strives to extract profits from a dull market this year, industry insiders said.
The situation is getting aggravated further due to early payoffs of loans by relatively good corporate clients.
“Banks, which are facing a dearth of business, are taking away our clients (credit lines). We cannot compete with banks as our cost of fund is higher than that of banks,” said Asad Khan, managing director of Prime Finance.
Khan, also the president of Bangladesh Leasing and Finance Companies' Association, said some of his company's borrowers paid off loans worth around Tk 100 crore so far this year.
Almost all the 31 non-banks, except for a few who were able to collect deposits directly, are facing the same challenge, due to a poor demand for money from businesses.
The dull business and sliding profit of the non-banks were also evident in the latest Bangladesh Bank report released last week.
Their return on assets (ROA) and return on equity (ROE) that give an indication of an institution's profitability fell by 28 percent and nearly 24 percent respectively in two years, according to the BB report.
The ROA was 2.5 percent in 2011, but it came down to 1.9 percent in 2012 and 1.8 percent in 2013.
In other words, a non-bank made a profit of Tk 1.8 for every Tk 100 it invested in its assets in 2013, down from Tk 2.5 two years ago.
The ROE, also known as return on investment, has also been declining since 2011. Their ROE slid to 9.2 percent in 2013 from 12.1 percent in 2011, meaning their net income returned as a percentage of shareholders equity fell by nearly 24 percent in just two years.
Industry players blamed the poor business on the tedious economic conditions that started with the stockmarket debacle in 2010 followed by last year's political crisis.
The investment situation did not improve much even after eight months of the national elections in January, they said.
In addition, nine new banks that started operations last year to take the tally of scheduled banks to 56 have further intensified the competition between banks and non-banks in netting new clients.
Stringent rules introduced by the regulator are also taking a toll on the business of the non-banks, officials said.
“We are struggling to survive. Our margin has gone down significantly and we are being forced to cut jobs,” said Asaduzzaman Khan, managing director of IIDFC.
Some clients, especially the good ones, are paying their loans off, he said. “We are trying to retain the customers by offering lower rates of interest.”
Published: 12:00 am Tuesday, September 09, 2014

Disclosure requirement, risk management of banks, FIs emphasised

FE Report - 09 September '2014 Tuesday
A workshop titled ‘impact of BASEL-II implementation on the national economy with special reference to disclosure requirement and risk management of banks and financial institutions’ organised by Institute of Cost and Management Accountants of Bangladesh (ICMAB) was held Monday at the ICMAB auditorium in the city.

This event was planned and conducted as a part of South Asian Federation of Accountants (SAFA) activities participated by members of ICMAB, President of ICAB Showkat Hossain, FCA and its Council members, member representatives from the SAARC countries, Bankers and professionals of different sectors associated with financial disciplines. Mr. M A Mannan MP, Minister of State, Ministry of Finance & Ministry of Planning graced the occasion as the Chief Guest while Mr. Shitangshu Kumar Sur Chowdhury, Deputy Governor, Bangladesh Bank remained present as the Special Guest. Mr. Niyaz Ibrahim, Auditor General of Maldives was invited as the Guest of Honour in this occasion. President of ICMAB Mr. Mohammed Salim, FCMA offered the welcome address and he highlighted the overall activities of ICMAB. Mr. Muzaffar Ahmed, FCMA, past President of ICMAB and President of CRISL presented the theme paper in the workshop. Mr. A.S.M. Shaykhul Islam, FCMA offered the vote of thanks. Mr. Mohammad Mahbubur Rahman, FCMA announced the program.

This workshop was conducted as a part of SAARC aligning activities on the issues of BASEL-II in its second phase of road- map plan to be implemented by the Banking Sector as a matter of policy guideline for SAARC countries. In the beginning of 1980s the Banks of International Settlement (BIS) at Switzerland formed a committee named Basel Committee to look after the banks' Capital adequacy. Thereafter, from the beginning of 1996, the BIS came up with an improvement of BASEL-I and pronounced BASEL-II, a capital Adequacy Framework where the Banks are required to operate under three pillars e namely. Minimum Capital Requirements, Supervisory Review and Market discipline This plan is expected to have a direct impact not only the operational environmental of Banks and FIs (Financial Institutions)  but also on the Financial Reporting Standards,  systems and procedures.

Shurwid Industries makes cheerful debut on bourses

FE Report - 09 September '2014 Tuesday
Shurwid Industries Ltd (SIL) Monday made a cheerful debut at the bourses - Dhaka Stock Exchange (DSE) and Chittagong Stock Exchange (CSE) despite the overall stock market closed lower.

The Shurwid Industries, a PVC products manufacturer, share skyrocketed by 382 per cent or Tk 38.2 per share from its offer price of Tk 10 in the DSE.

Each share of the company Monday traded between Tk 50.5 and Tk 33.3 on the DSE before closing at Tk 48.2. A total of 6.47 million shares changed hands, generating a turnover of Tk 258.32 million.

In the port city bourse - CSE, each share of the company traded between Tk 50 and 32.8 and closed at Tk 47.7, after gaining 377 per cent from its issue price of Tk 10.

It was also the most traded stock at the CSE with shares worth Tk 1.48 million changing hands and the second most traded stock at DSE after Singer BD.

"Debutant Shurwid Industries attracted the investors much as the company came to with a face value -- without premium," said an analyst.

The company, which received regulatory approval from the Bangladesh Securities and Exchange Commission in April, floated 14 million ordinary shares at an offer price of Tk 10 and raised a fund worth Tk 140 million from public.

The net profit of the company was Tk 25.48 million and basic EPS Tk 0.81 for the nine months (July 2013 to March 2014) as against Tk 24.50 million and Tk 0.78 for the same period of the previous year.

DSE sees sluggish turnover

FE Report - 09 September '2014 Tuesday
Stocks ended lower for the second consecutive session Monday with sluggish turnover as investors continued on profit booking.

The market opened with an uptrend but could not sustain the momentum during the second half of the session. DSEX, the prime index of the Dhaka Stock Exchange (DSE) ended at 4,608.95 points, shedding 32.49 points or 0.70 per cent from previous session.

The other two indices also closed in the red. The DS30, comprising blue chips lost 9.91 points or 0.56 per cent to close at 1,738.32 points. The DSE Shariah Index went down by 4.92 points or 0.45 per cent to close at 1,075.96 points.

The total turnover on DSE dropped further and amounted to Tk 5.02 billion, which was 3.2 per cent lower over the previous session's value of Tk 5.19 billion.

The investors' activity was mostly concentrated on engineering, pharmaceuticals and textile - the sectors that accounted for 22 per cent, 14 per cent and 13 per cent respectively of the day's total turnover.

"The market endured a typical bearish session amidst the investors' profit booking attitude coupled with cautiousness as they are waiting for new investments opportunities," commented International Leasing Securities.

The investors' attention was captured by a few industry leading stocks from various sectors. The investors also responded positively to the interim declaration of 160 per cent cash from Singer BD as the stock registered a staggering of 17.9 per cent gains, said the International Leasing.

IDLC Investments said: "Downturn continued in the market amid slowing turnover and profit booking for the second consecutive session of the week".

Out of 298 traded stocks 46 fell more than 3.0 per cent whereas only 15 posted above the same level, said the merchant bank.

"The market extended losses for the second day of the week, getting no support from any particular sectors," said Zenith Investments.

Even last day's banks and financial institutions turned their backs to the market creating extra force for the index to gravitate, said the Zenith Investments.

"It is normal for the index to turn around and 'go slow' when it came close to 4,700 points, as investors becomes highly sensitive whenever the index comes near to any round figure," the Zenith analysis added.

The multinational companies dominated the gainers' chart. Among the top ten gainers, five emerged from multinational companies.

Among the large sectors, food and pharmaceuticals posted gains of 1.20 per cent and 0.61 per cent respectively. Banks lost 1.01 per cent.

Telecommunication and fuel and power went down by 0.16 per cent and 0.64 per cent respectively. NBFIs closed flat with no significant movement.

The losers took a strong lead over the gainers as out of 298 issues traded, 202 declined, 71 advanced and 25 remained unchanged on the DSE floor.

Activities decreased in the major bourse (DSE) where trade and volume were down by 7.60 per cent and 8.07 per cent respectively. A total of 0.121 million trades were executed with 118.07 million securities of trading volume.

The total market capitalisation of the DSE stood at Tk 3,107.83 billion against Tk 3,113.37 billion in the previous session.

Singer Bangladesh was the most traded stocks with shares worth Tk 391.58 million changing hands followed by newly listed Shurwid Industries, ACI, Beximco and MJL BD.

Shurwid Industries, which made debut Monday, was the day's highest gainer, posting a rise of 382 per cent while Imam Button was the day's worst loser, slumping by 7.40 per cent.

The port city bourse, Chittagong Stock Exchange (CSE) also closed lower with its Selective Categories Index - CSCX - lost 62.43 points to close at 8,675.23 points.

Losers beat gainers 170 to 36, with 21 issues remaining unchanged at the port city bourse that traded 11.15 million shares and mutual fund units, turnover value of Tk 422.88 million.