Friday, April 17, 2015

DSE posts record turnover, as sideliners return to market

FE Report-17 April'2015 Friday
Turnover value on the Dhaka Stock Exchange (DSE) crossed Tk 5.0 billion-mark Thursday for the first time in 2015, hitting a five-month high, supported by strong buying and selling pressure.

Daily turnover jumped to Tk 5.38 billion, registering an increase of 14.6 per cent over the previous session's value of Tk 4.69 billion. It is the highest turnover value since November 19, last year when it was Tk 5.76 billion.

The investors' activity was mostly concentrated on power, engineering and food and allied-the sectors that accounted for 22.9 per cent, 12.4 per cent and 11.3 per cent respectively of the day's total turnover.

Along with increasing turnover, the prime index of the DSE-DSEX-also went up by 12.84 points or 0.29 per cent to close at 4,373.33 points.

However, two other indices ended in negative territory. The DS30 index, comprising blue chips, lost 2.35 points or 0.14 per cent to close at 1,668.34 points. The DSE Shariah Index (DSES) shed 4.50 points or 0.42 per cent to close at 1,060.88 points.

"Sideliners seemed to be returning to the market, registering Tk 5.38 billion-turnover, which is continuously improving for last three sessions. The additional fund flow caused upbeat prices for many issues," said IDLC Investments, a merchant bank, in an analysis.

However, sellers still remained strong restraining market to enter into a positive correction mode. Their dominance sustained, assisting DSEX to close 13 points higher, despite the fact that buyers pulled the market up by almost 50 points, early in the session, said the merchant bank.

Recent earnings disclosure for the period of January-March 2015 had been 'promising' so far and may have partly played in increased turnover. The hypothesis got enforced, by upbeat earnings disclosure and subsequent price appreciation of Heidelberg Cement and Zahintex Industries, said the merchant bank.

"The market ended in positive territory amidst increased participation from the investors," said International Leasing Securities.

The morning buying pressure slowed later as several investors preferred to book short-term profit as they remained 'watchful' on sudden market reversal, said the International Leasing.

The market turnover crossed the Tk 5.0 billion-mark as investors started to become active in the market who stayed on the sideline during the recent bearish momentum, it said.

The large-cap sectors posted mixed performance. Banks and NBFIs in the financial sector registered gains of 1.73 per cent and 0.99 per cent respectively. Power advanced by 0.59 per cent.

The gainers took a modest lead over the losers as out of 310 issues traded, 142 advanced, 136 declined, and 32 remained unchanged.

    babulfexpress@gmail.com

Turmoil stings banking sector - Prime Bank boss tells press brief

FE Report-17 April'2015 Friday
Prime Bank Limited has vowed to put its maximum efforts and utilise the latest technology to render better banking services to its clients.

Managing director of the bank Ahmed Kamal Khan Chowdhury made the pledge at a press conference arranged at a city hotel on the occasion of its 20th anniversary.

The press conference was attended, among others, by deputy managing directors and other senior officials of the bank.

"We are observing that customers' demands are changing with the rapid pace of globalisation. To ease their busy life, we are putting emphasis on technology-driven products so that they can meet their banking needs without going to the bank," Mr Chowdhury said.

He further said, "We are continuing to make all technological upgradation at the bank and at the same time trained our human resources to handle the technology."

Mr Chowdhury spoke about current activities and future plans of Prime Bank that started its journey in 1995.

The managing director said that in 20 years of the bank, the number of its customers already crossed 0.5 million.

The bank opened a total of 140 branches in different places of the country and all are equipped with online banking services, he said, adding that the bank also has a banking wing that operates on Shariah principles.

To expand its remittance services, the bank is considering opening another exchange house or team up with a bank in South Korea and other regions of the world, he said.

He noted that recent political unrest has had considerable negative impact on the banking industry.

"Our import and export trade was hindered (by the unrest). We didn't see investment at expected level. For this reason, the banking sector, as a whole, could not achieve the expected growth," Mr Chowdhury said.

He also said that the bank will provide loan to the Readymade Garment (RMG) factory owners to help them become compliant with requirements of Accord and Alliance.

To this effect, he continued, an agreement is under process and will be signed between the bank and the International Finance Corporation (IFC) to get fund from the latter.

"We hope that we can disburse the loan at single digit interest rate. However, it is depending on the deal." he said, adding that each individual might get Tk 30-40 million.

To celebrate the anniversary, the Prime Bank has chalked out a month-long programme beginning from today (April 17).

Under the programme, Visa, Master and JCB carder holders of the bank will get 50 per cent discount on their purchase at different restaurants, hotels, jewelries and home appliance shops.

Other activities include blood donation by the bank's officials and employees, art competition for children of the bank's employees and get-together of its customers at the divisional level.

The bank will also launch World Master Card soon for its customers, the managing director said.

He also thanked the shareholders, customers and well wishers for their supports toward the bank for reaching the current position.

Moreover, the bank will conduct promotional activities of its school banking "My First Account" across the year.

Mr Chowdhury said that the bank, through Prime Bank Foundation, will also strengthen its position by rendering its philanthropic services in the areas of health, education and sports along with its banking services.

    md.ali.du@gmail.com

Third instalment of Tk 9b stock market rejuvenation package ICB for releasing rest Tk 3b

FE Report-17 April'2015 Friday
Syful Islam
The Investment Corporation of Bangladesh (ICB) urged the government recently to release Tk 3.0 billion from bailout package to help investors who were affected during the stock market debacle in December 2010-January 2011 period, officials said.

This is the third instalment of Tk 9.0 billion package which the government approved in June 2013 in a bid to give the kiss of life to the moribund capital market.

In two separate instalments the government had already released Tk 6.0 billion from the stock market rejuvenation package.

A senior official at the ministry of finance told the FE Thursday that ICB has made the request to Bangladesh Bank, through which the fund is being given. Now the central bank will send note to the finance ministry for release of the third instalment of the package from government coffer.       

He said affected investors of stock market debacle got relief by availing the low cost loan from the fund. "Prices of many shares now stand at below their face value. If someone now buys shares for long period he or she will get good return."

Asked whether the bailout package really helped the affected investors who lost a large amount of money during the free fall of share prices nearly four years back, the official said, "You can't expect good profit very quickly. You have to wait for that." 

According to the ICB officials, until first week of April some Tk 4.673 billion loan has been disbursed among 19,328 affected small investors of 29 merchant banks and stock brokerage houses.

Besides, disbursement of another Tk 486.40 million among 1,376 small investors is underway.

They said until now approval is given to disburse Tk 5.269 billion among 21,069 affected investors from Tk 6.0 billion released by the government from the fund. Some 22,634 affected investors had expressed willingness to avail Tk 5.752 billion as loan from the refinancing scheme.

Among merchant banks and brokerage firms, ICB Capital Management has so far received Tk 844.8 million, while ICB Tk 566.7 million, Janata Capital and Investment Tk 407.8 million, IIDFC Securities Tk 201.5 million, Fareast Stocks and Bonds Tk 187.0 million, International Leasing Tk 159.9 million, NCCB Securities and Financial Services Tk 114.4 million, BLI Capital Tk 116.1 million and LankaBangla Investments Tk 109.0 million.

ICB Capital Management has also received Tk 741.8 million in the second phase.

Officials said affected investors will be able to apply for refinancing facility until June 30 this year. Due to less-than expected investors' response and tough conditionality, the securities regulator earlier extended the timeframe for fourth time to apply for re-financing facility.

Only the affected investors, who had below Tk 1.0 million investment in the capital market during the stock market debacle, have been offered to get loan from the capital-market refinancing scheme.

    syful-islam@outlook.com

Wednesday, April 15, 2015

DSE turnover crosses Tk 4.0b-mark

FE Report - 14 April'2015 Tuesday
The country's premier bourse Monday observed a sharp rise in turnover value amid a marginal loss in indices due to mixed performance of major sectors.

Institutional investors said the market got slightly down as investors were 'keen' on profit taking.

On the day the turnover value stood at Tk 4.12 billion which is 42.34 per cent up than the value observed in previous session on Dhaka Stock Exchange (DSE).

At the same time trade and volume were also up by 25.34 per cent and 32.76 per cent respectively.

"The positive outcome of normalcy observed in politics is yet to be reflected in the market. Investors are also awaiting the corporate declaration for the first quarter of listed companies," said Md. Moniruzzaman, the managing director of IDLC Investments.

He said institutional investors are not able to play due role in making the market vibrant due to shortage of capital.

On Monday the DSE broad index (DSEX) shed 0.31 per cent or 13.64 points to close at 4291.62 points.

DSE Shariah Index lost 0.20 per cent or 2.15 points to close at 1054.65 points whereas DSE30, comprising blue chips, went down by 0.33 per cent or 5.56 points to close at 1653.61 points.

Out of 311 issues traded, 121 advanced, 146 declined and remaining 44 remained unchanged at the end of the day's trading session.

Among the major sectors, Fuel and Power, Food and Allied and Engineering gained in market cap by 2.77 per cent, 1.56 per cent and 0.51 per cent respectively.

NBFI, Cement, and Banks declined by 2.41 per cent, 1.10 per cent and 0.82 per cent respectively.

United Power Generation and Distribution Company topped the chart of turnover leaders with a value of Tk 483.86 million. The other turnover leaders are MJL Bangladesh, Saif Powertec, IFAD Autos, ACI, Square Pharma, Unique Hotel and Resorts and Grameenphone.

Jute Spinners was the day's worst loser followed by Islamic Insurance, Standard Ceramic, Far East Islami Life Insurance and Prime Textile.

The board of AB Bank recommended 12.5- stock dividend for the year ended on December 31, 2014.

On the port city bourse--Chittagong Stock Exchange (CSE), benchmark index CASPI went up by 1.86 points to close 13209.35 points.

Among 240 issues traded, 96 advanced, 120 declined and remaining 24 remained unchanged.

At the end of the day's trading session, the turnover value stood at Tk 386.44 million on the CSE.

mufazzal.fe@gmail.com

Monday, April 13, 2015


DSE relaunches website, stocks hit 15-month low

Daily Star - 13 April'2015 Monday
The Dhaka Stock Exchange yesterday relaunched its website in an effort to make it more user-friendly and generate income using the site as an advertisement platform.
While investors can get market-related information more easily and smoothly, local and international institutions can post their advertisements on the website, whose size and view has been made larger than the previous ones.
The key feature of the website is its indices graph, as one can see the time and value of the indexes just by putting the pointer on the graph, a feature which was not available in the earlier website.
Addresses of the premier bourse's website, however, remain the same -- www.dsebd.org and www.dse.com.bd -- but their resolution has been increased to 1,024 pixels from 800 pixels before.
Inaugurating the website, DSE Chairman Siddiqur Rahman Miah said the site has been updated in continuation with a new and fast automated trading system.
The DSE in December last year introduced the new trading software, replacing the previous one, which was faulty, to ensure smooth share transactions.
NASDAQ OMX, the world's largest exchange company based in the US, provided the main part -- matching engine -- while FlexTrade Systems provided the order management system at the brokers' end.
Any investor from home and abroad can now get market-related data and information accurately in the shortest period of time, the DSE chairman said.
Swapan Kumar Bala, managing director of the bourse, however, said upgradation of the website will continue and the final updated version will be launched in July. “We will also introduce a mobile app so that investors can watch the website on their mobile phones without any disruption,” he said.
The DSE launched its website in 2000 as part of the automated trading system, and then updated it several times.
Meanwhile, stocks declined for the second day yesterday, with DSEX, the benchmark index of Dhaka bourse, hitting a 15-month low of 4,305.26 points, after falling 40.62 points or 0.93 percent.

Grameenphone ex-employees stage demo for profit share

New Age - 13 April'2015 Monday


A group of ex-employees of leading mobile phone company Grameenphone on Sunday staged demonstration in front of the GP headquarters demanding 5 per cent share of the company’s 2010-12 earnings.
The former employees, who worked in GP from 2010 to 2012, formed a human chain in front of the main entrance of GP House in the Bashundhara Residential Area under the banner of Grameenphone Employees Union. The demonstration started at around 1:30pm and lasted for about one and half hours.
GPEU general secretary Mia Masud, while talking to New Age, said ‘Although the current employees are getting the profit share for the 2010-12 period following a court order, the ex-employees are yet to get their share.’
‘But the ex-employees are also legally entitled for the benefit as they worked in the company during that time,’ he said.
The GPEU supports the move of the ex-employees to get their rightful demand, Masud said.
Asked about the issue GP, in an email reply, said the disbursement of the profit share for the years 2010, 2011 and 2012 almost came to an end and the decision about this issue was taken by an independent board of trustees.
‘Decisions regarding disbursement of fund are solely taken by this board, and former employees who are claiming dues from this fund have been instructed to divert their queries to the trustee chairman, as the fund and permanent employee list for the relevant period is with the board of trustees. Associated issues with regard to the fund are currently undergoing judicial determination,’ said the GP statement.

 

A group of ex-employees of leading mobile phone company Grameenphone on Sunday staged demonstration in front of the GP headquarters demanding 5 per cent share of the company’s 2010-12 earnings.
The former employees, who worked in GP from 2010 to 2012, formed a human chain in front of the main entrance of GP House in the Bashundhara Residential Area under the banner of Grameenphone Employees Union. The demonstration started at around 1:30pm and lasted for about one and half hours.
GPEU general secretary Mia Masud, while talking to New Age, said ‘Although the current employees are getting the profit share for the 2010-12 period following a court order, the ex-employees are yet to get their share.’
‘But the ex-employees are also legally entitled for the benefit as they worked in the company during that time,’ he said.
The GPEU supports the move of the ex-employees to get their rightful demand, Masud said.
Asked about the issue GP, in an email reply, said the disbursement of the profit share for the years 2010, 2011 and 2012 almost came to an end and the decision about this issue was taken by an independent board of trustees.
‘Decisions regarding disbursement of fund are solely taken by this board, and former employees who are claiming dues from this fund have been instructed to divert their queries to the trustee chairman, as the fund and permanent employee list for the relevant period is with the board of trustees. Associated issues with regard to the fund are currently undergoing judicial determination,’ said the GP statement. - See more at: http://newagebd.net/111173/grameenphone-ex-employees-stage-demo-for-profit-share/#sthash.ZGPE1pbk.dpuf

Main bourse upgrades website

FE Report - 13 April'2015 Monday
The country's premier bourse Sunday upgraded its website by incorporating more real time data and information on listed securities and share trading to enhance information service to investors, officials said.

Justice Siddiqur Rahman Miah, the chairman of Dhaka Stock Exchange (DSE), inaugurated the upgraded version of their website at an inaugural ceremony held at the DSE premises.

On December 11, 2014, the DSE launched the Next Generation Automated Trading system--- DSE-FlexTP---for enhancing the exchange's technological capability and introducing some proposed products

"The premier bourse now has upgraded its website as part of its continuous move to modernise the exchange," said the DSE chairman.

DSE managing director Dr. Swapan Kumar Bala and two DSE directors--Khwaja Ghulam Rasul and Sharif Anowar Hossain--were also present at the inaugural ceremony arranged to launch upgraded website.

Managing director Dr. Bala said new website is more informative than the previous one.

"Investors will be benefited due to launching of new website. Reforms of DSE website will be completed in July next. New mobile apps will be introduced soon so that investors can visit DSE website through mobile phones," Mr. Bala said.

He said the premier bourse recently signed an agreement with an organisation to launch online payment gateway service.

"DSE has moved to introduce e-data system by avoiding paper based activities. Software will be purchased to introduce the system," Mr. Bala added.

On the upgraded website, which is introduced Sunday on DSE, investors will be able to know about accurate points of indices and time in any point of the graphs.

The DSE has also incorporated a banner view on its website to represent any information in the form of picture.

Some tab windows have been included on upgraded website through which more information will be available within quickest possible time.

In the bottom of DSE's upgraded website, visitors will also get some sources of information regarding different stakeholders of the capital market.

The premier bourse introduced automated trading system on August 10, 1998 and later the exchange's first official website was launched in October, 1999.

    mufazzal.fe@gmail.com

Indices, turnover drop on DSE

FE Report - 13 April'2015 Monday
All indices and turnover value declined Sunday on Dhaka Stock Exchange (DSE) as majority number of listed securities went red on the week's first trading.

Some merchant banks and brokerage firms said investors were cautious to trade and consequently from the start of the trading session the indices stated to decline and continued till the closing of the Sunday's session.

"From the start of the trading session the indices started falling. The benchmark index DSEX fell below the 4300 level, but got support at that level and closed just above the mark at 4305.27," said LankaBangla Securities.

On the day the turnover value declined by 21.24 per cent or Tk 781.18 million to close at above Tk 2.89 billion.

Market capitalisation also shed 0.56 per cent or Tk 17.62 billion to close at Tk 3097.84 billion on the premier bourse.

DSE broad index (DSEX) shed 0.93 per cent or 40.62 points to close at 4305.26 points, which is the lowest point of prime index in last 15 months.

"The market entered into a downtrend, clear in hindsight in October 2014 from index's recent peak of 5,334 points and lost around 1,000 points or 19 per cent of that value in ensuing 6 months," said another market analysis of IDLC Investments.

DSE Shariah Index Sunday also declined by 0.83 per cent or 8.87 points to close at 1056.80 points whereas DSE30, comprising blue chips, went down by 0.71 per cent or 11.99 points to close at 1659.17 points.

Among 299 issues traded, 68 advanced, 200 declined and remaining 31 remained unchanged.

United Power Generation and Distribution Company topped the chart of turnover leaders with a value of Tk 377.59 million followed by MJL Bangladesh, IFAD Autos, Shasha Denims, Unique Hotel and Resorts, Grameenphone, Square Pharma, Bangas and Beximco Pharma.

On the other hand, Northern Insurance topped the chart of top ten losers with a loss of 10.32 per cent followed by Shahjalal Islami Bank, Modern Dyeing and Screen Printing, Mercantile Bank, Islamic Finance and Investment, Pragati Insurance, Popular Life Insurance and Peoples Insurance.

On Sunday, the boards of some listed companies recommended dividends for the year ended on December 31, 2014.

Among the companies, Popular Life Insurance recommended 40 per cent stock dividend, whereas Shasha Denims recommended 20 per cent cash dividend and 15 per cent stock dividend, Northern Insurance 10 per cent stock dividend, City General Insurance 10 per cent stock dividend, IFIC Bank 15 per cent stock dividend and Mercantile Insurance 10 per cent cash dividend.

On the port city bourse--Chittagong Stock Exchange, benchmark index CASPI shed 101.45 point to close at 13207 points.

Among 226 issues traded, 60 advanced, 145 declined and remaining 21 remained unchanged.

At the end of the day's trading session, the turnover value stood at above Tk 271.74 million on the CSE.

mufazzal.fe@gmail.com

Friday, April 10, 2015

BSEC approves Aman Feed IPO

FE Report - 10 April'2015 Friday
The securities regulator has approved the IPO (initial public offering) proposal of Aman Feed, which will raise Tk 720 million to expand its business and shore up capital, officials said.

The Bangladesh Securities and Exchange Commission (BSEC) has also asked the stock exchanges to continue trading of 1st ICB Mutual Fund (MF), whose maturity period ended on March 31 last until no new order is issued.

The decisions were taken at a commission meeting held Thursday.

Under the fixed price method, Aman Feed will offload 20 million ordinary shares at an offer price of Tk 36, including a premium of Tk 26 for each Tk 10 share.

The company will expand its business, repay long term loan and bear the cost of IPO processing with the fund raised from public.

The company's earning per share (EPS) and net asset value (NAV) per share are Tk 4.97 and Tk 30.77 respectively, according to the company financial statement that ended on June 30, 2014.

LankaBangla Investment is the issue manager of Aman Feed.

As per regulatory directive, eight MFs including the 1st ICB MF managed by the Investment Corporation of Bangladesh (ICB) will have to be redeemed in different phases.

The tenure of the 1st MF ended on March 31 and no trading of the units of the fund took place till Thursday as the regulator could not reach any final decision.

Meanwhile, the ICB has again sought time extension for its funds. And the regulator has sought legal opinion with regard to extension of term of ICB's MFs.

Under such a situation, the BSEC Thursday asked the stock exchanges to continue trading of the units of 1st ICB MF until further instruction.

At the meeting held Tuesday, the securities regulator imposed penalties of Tk 0.1 million and Tk 0.7 million on Fareast Stocks & Bonds and Holy City Securities respectively for breaching securities rules. 

    mufazzal.fe@gmail.com

Stocks flat line as selling pressure outweighs buys

FE Report - 10 April'2015 Friday
Stocks ended flatlined Thursday amid choppy trading as late hours selling pressure wiped out early gains.

The market opened with a positive note, but failed to sustain as the session progressed. DSEX, the prime index of the Dhaka Stock Exchange (DSE), inched down by 1.24 points or 0.02 per cent to close at 4,345.89 points.

The DS30 index, comprising blue chips, lost 0.30 points or 0.01 per cent to close at 1,671.17 points. However, the DSE Shariah Index (DSES) closed in positive, gaining 3.06 points or 0.28 per cent to close at 1,065.68.

Turnover, the most crucial gauge of the market, declined 1.08 per cent to Tk 3.67 billion, compared to the previous day's value of Tk 3.71 billion.

The investors' attention remained mostly focused on power, pharma and engineering - the sectors that accounted for 26 per cent, 21 per cent and 10 per cent of the day's total turnover.

 "The market failed to sustain its positive walk as pessimist investors took the lead over the optimists," said International Leasing Securities, a stock broker, in an analysis.

Despite the softening tone in the country's shaky political arena, investor's sentiments oscillated between optimism and carefulness, leading the market to close another flat session, said the stock broker.

 "Cheaper price level of several issues attracted opportunistic investors to the market. However, their buy pressure seemed inadequate to make a difference in the broad market," IDLC Investments, a merchant bank, said.

 "Participants' lack of confidence on the stability of political calm remained a major reason of the pessimism," said the merchant bank.

LankaBangla Securities, a stock broker, said the last day of the week saw another turbulent trading session. The market experienced a lot of ups and down throughout the session, but closed almost at the same point where it started.

The large-cap sectors showed mixed performance. Cement registered the highest gain of 0.88 per cent. Banks went up slightly by 0.12 per cent and pharmaceuticals closed flat with 0.04 per cent rise.

Fuel and power retraced, losing 0.87 per cent. Telecommunication and food and allied sectors ended lower by 0.44 per cent and 0.24 per cent respectively. NBFIs went down 0.27 per cent.

Losers outpaced gainers as out of 304 issues traded, 158 declined, 125 advanced, and 21 remained unchanged.

Activities decreased slightly in the major bourse, where trade and volume were down by 3.80 per cent and 6.18 per cent respectively. A total number of 0.101 million trades were executed with trading volume of 69.92 million securities.

The market capitalisation on the DSE stood at Tk 3,115.47 billion against Tk 3,121.04 billion in the session before.

Newly listed United Power remained the most traded stock for five consecutive sessions with shares worth Tk 456.86 million changing hands, capturing 12.42 per cent of day's total turnover, followed by ACI, Square Pharma, MJL BD and IFAD Autos.

The port city bourse Chittagong Stock Exchange (CSE) also returned to the red with its Selective Categories Index - CSCX - lost 36.22 points to close at 8,090.85 points.

Losers beat gainers 126 to 81, with 28 issues remaining unchanged at the port city bourse that traded 7.78 million shares and mutual fund units, turnover value of Tk 337.82 million.

    babulfexpress@gmail.com

CEO named for cement titan LafargeHolcim

Daily Star - 10 April'2015 Friday
The boards of France's Lafarge and Switzerland's Holcim have approved Eric Olsen for the role of chief executive officer once the firms merge, creating the world's biggest cement company, they announced on Thursday.
The 51-year-old French-American national, who is currently executive vice president for operations at Lafarge, "is the perfect person to lead the company in the future," Holcim chairman Wolfgang Reitzle told reporters.
Last year the two companies announced plans to create a cement titan employing more than 130,000 people, which would generate annual sales of 32 billion euros ($34 billion) and underlying profits of 6.5 billion euros -- a major event in the global construction industry.
The merger still must be approved by two-thirds of shareholders at each of the two companies at special general assemblies.
In March the two companies renegotiated the exchange ratio for the merger -- nine Holcim shares for 10 Lafarge shares -- after the sharp rise in the Swiss franc drove up Holcim's value.
Analysts with Vontobel warned Thursday that "recent news flow regarding the shareholders opposition" to the merger indicated the chance of the deal going through had dropped to just 50 percent from its previous estimate of 75 percent.

Thursday, April 9, 2015

NBFIs asked to keep 100pc provision against write-off loans

New Age - 09 April ' 2015 Thursday


Bangladesh Bank on Wednesday asked non-bank financial institutions to keep 100 per cent provision before declaring their defaulted loans of the bad or loss category write-off.
The BB issued a circular to managing directors and chief executive officers of all NBFIs asking them to file case with court against the defaulters before declaring the loans write-off.
The NBFIs, however, will be allowed to convert defaulted loans amounting to Tk 50,000 or less into write-off without filing any case with court.
The NBFIs and banks have to write-off the defaulted loans of the bad category when they think that they will not be able to recover the loans in the coming days under any circumstances, a BB official told New Age on Wednesday.
After the write-off, the banks and NBFIs keep aside the calculation of defaulted loans from their financial balance sheets, he said.
A loan will be converted into defaulted one of the bad category if the client does not pay any instalment of his or her loan for nine months in a row.
The latest BB circular said that the management of the NBFIs would have to take prior approval from their respective board of directors to write-off the defaulted loans.
The NBFIs will be allowed to appoint third party to recover the write-off loans and settle the pending cases with courts in connection with the loans.
The NBFIs will have to treat the clients as defaulters, whose loans will be converted into write-off, when they submit reports to the BB’s credit information bureau.
The NBFIs will have to attach the amount of the write-off loans with their annual statements, the BB circular said.
The NBFIs will have to take prior approval from the central bank to write-off the defaulted loans of their directors and accounts having directors’ interest.
The NBFIs will not be allowed to waive the write-off loans for their clients in any circumstances, the circular said.
The NBFIs were asked to submit information of their outstanding amount of write-off loans in every three months to the central bank.
The NBFIs will have to give all-out effort to recover their write-off loans.

Square Textiles to invest Tk 114cr to raise capacity - New project to take off next year

Daily Star - 09 April'2015 Thursday
Square Textiles, a concern of Square Group, plans to increase its yarn production capacity with an estimated investment of Tk 113.87 crore.
The export-oriented company now produces 21,600 tonnes of yarn a year at its three units. After the completion of the new project next year, another 4,235 tonnes will be produced.
Square Textiles is expecting Tk 119 crore in turnover from the additional capacity, according to a posting on the Dhaka Stock Exchange website yesterday.
The company also said the expected profit contribution will be around 11 percent on the turnover.
The disclosure came after its board approved the investment plan at a meeting on Tuesday.
At the meeting, Square Textiles, which was listed on the stockmarket in 2002, also recommended 20 percent cash and 10 percent stock dividends for 2014.
The company's net profit, however, declined 35 percent year-on-year to Tk 54.11 crore in 2014. Its earnings per share stood at Tk 3.66 at the end of last year.
On the premier bourse yesterday, each Square Textiles share traded between Tk 82 and Tk 86.1 before closing at Tk 83.9.

Stocks bounce back as bargain hunters come to market's rescue

FE Report - 09 April'2015 Thursday
Stocks posted marginal gain Wednesday with high volatility, snapping five sessions' losing streak as 'bargain hunters' went for late-hour buying spree.

The market began with the sell-off like previous few sessions. However, early selling pressure eased later as optimistic investors started to take position in fundamental stocks, leading the market to close in flat.

DSEX, the prime index of the Dhaka Stock Exchange (DSE), went up by 2.10 points or 0.04 per cent to close at 4,347.13 points, after shedding 185 points in the past five straight sessions.

The DS30 index, comprising blue chips, advanced 2.30 points or 0.13 per cent to close at 1,671.47 points. However, the DSE Shariah Index (DSES) ended in the red, losing 1.59 points or 0.14 per cent to close at 1,062.62 points.

The total turnover on DSE stood at Tk 3.71 billion, which was 14 per cent higher over the previous day's value of Tk 3.25 billion.

The investors' attention remained mostly focused on power, pharma and engineering - the sectors that accounted for 23 per cent, 22 per cent and 12 per cent of the day's total turnover.

An analyst said the market absorbed a significant downhill in the last five sessions when bargain hunters stepped in. "The DSEX attracted value investors as stocks were available at discounted price," he said.

"The stock market's current bearish spell took new turn as recent price correction in several issues has created some impetus for undervaluation," said International Leasing Securities, a stock broker, in an analysis.

IDLC Investments, a merchant bank, said, "The day started in continuation of last few sessions' losing streak. Witty investors recognised that many issues are in bargain price and acted upon, causing a halt in the downfall".

"It was an eventful day for the investors. There was a lot of volatility in the capital market," said LankaBangla Securities, a stock broker.

The day started very badly as the DSEX started falling and got below the 4,300 level within the first 90 minutes of the trading session. However, there was strong support at that level and market quickly turned around and closed with a marginal gain, said the stock broker.

The large-cap sectors saw mixed performance. Telecommunication and pharmaceuticals appreciated by 1.03 per cent and 0.27 per cent respectively.

All the other major sectors closed in red. Cement witnessed the highest loss 0.84 per cent. In the financial sectors, both banks and NBFIs went down 0.13 per cent and 0.19 per cent respectively. Power also retraced in the session, losing 0.10 per cent.  Food and allied closed in the red.

Losers outnumbered gainers, as out of 303 issues traded, 148 declined, 120 advanced and 35 issues remained unchanged at the DSE.

Activities increased in the major bourse where trade and volume were up by 5.74 per cent and 8.01 per cent respectively. A total number of 0.105 million trades were executed with trading volume of 74.53 million securities.

The market capitalisation on DSE stood at Tk 3,121.04 billion against Tk 3,116.52 billion in the previous session.

Newly listed United Power dominated the top turnover chart for four running sessions, with shares of Tk 388.98 million changing hands, which was 10.47 per cent of total turnover followed by ACI, Unique Hotel, IFAD Autos and Pharma Aid.

Beach Hatchery was the day's best performer, positing a rise of 9.86 per cent while Imam Button was the day's worst loser, plunging by 7.05 per cent.

The port city bourse Chittagong Stock Exchange (CSE) also returned to the green, with its Selective Categories Index -- CSCX -- gaining 34.13 points to close at 8,127.07 points.

Losers beat gainers 113 to 92, with 25 issues remaining unchanged at the port city bourse that traded 7.74 million shares and mutual fund units. The market turned over at Tk 304.60 million.

    babulfexpress@gmail.com

BSEC looking over ICB plea to extend MFs' time limit

FE Report - 09 April'2015 Thursday
The securities regulator has sought legal opinion with regard to extension of term of eight mutual funds (MFs) managed by the state-run Investment Corporation of Bangladesh (ICB), officials said.

The move came after a request from the ICB to extend the tenure of the closed-end MFs for another 10 years.

The Bangladesh Securities and Exchange Commission had earlier asked the state-run corporation to redeem the funds within stipulated time frame.

Among eight MFs of ICB, tenure of 1st ICB MF ended on March 31 as per regulatory directive issued on September 29, 2014.

The regulator, in a directive, said each of the remaining seven MFs such as 2nd ICB, 3rd ICB, 4th ICB, 5th ICB, 6th ICB, 7th ICB and 8th ICB should be redeemed within every three months.

It also said the closed-end MFs can be converted into open-ended ones after completion of their tenures.

But the ICB wants to continue their funds without converting into open-ended.

The regulator has also got recommendations from the ministry of finance for extension, the BSEC officials said.

"We need legal opinion and recommendations from the ministry before we consider the ICB's plea," said a senior BSEC official.

He, however, said if ICB case is considered, funds managed by private asset management firms should also be taken into consideration.

He said if the ICB's time extension plea is not accepted, then the previous schedule set for redemption of the MFs will be rescheduled.

The BSEC official said his agency is also giving scope for the unit holders willing to quit the funds as per fair valuation if the tenure of those MFs is really extended.

In 2008, the BSEC asked the Asset Management Companies (AMCs) to wind up the closed-end MFs, whose tenure then crossed ten years by December 31, 2010.

But the tenure of the closed-end MFs managed by ICB AMCL was increased by one year, considering the market situation.

    mufazzal.fe@gmail.com

Wednesday, April 8, 2015

Dhaka stocks hit 8-month low

New Age - 08 April'2015 Wednesday


Staff Correspondent
Dhaka stocks declined for the fourth trading session on Monday with the key index of Dhaka Stock Exchange, DSEX, hitting its eight and a half months low amid investors’ fear of further market fall as the Appellate Division on the day rejected the review petition filed by war crimes convict Muhammad Kamaruzzaman.
Market operators said investors were apprehending that the political tension might escalate following the court verdict as the Bangladesh Jamaat-e-Islami immediately after the verdict against its senior assistant secretary general announced nationwide strike for Tuesday and Wednesday.
Operators also said that investors went for heavy share sales with a view to saving their investment from incurring further losses.
Besides, cancellation of a writ petition filed by BNP-backed mayoral aspirant Abdul Awal Mintoo also made investors shaky, operators said.
‘The day started in a positive mode after the improvement in the country’s political scenario yesterday [Sunday],’ LankaBangla Securities said in its daily market analysis.
‘However, the situation turned for the bad after the announcement of a two-day countrywide shutdown following a guilty verdict on a war crime case,’ it said.
The key index of the DSE fell by 0.76 per cent, or 33.85 points, to close at 4,397.25 points, the lowest after 4,388.68 points in July 23 last year.
The DSEX since January this year lost 544 points from 4,941 points in January 1 this year.
DS30, the blue-chip index of the bourse, fell by 0.65 per cent, or 11.06 points, to close at 1,685.73 points on the day.
The Shariah index of the DSE, DSES, finished at 1,075.05 points, shedding 0.88 per cent or 9.61 points.
Of the 310 shares and mutual funds traded on the day, 56 advanced, 218 declined and 36 remained unchanged.
Turnover at the bourse declined to Tk 305.07 crore on Monday compared with that of Tk 311.61 crore in the previous trading session.
‘Today’s [Monday’s] session started positively but succumbed to selling pressure in the later part of the day,’ IDLC Investments said in its daily market commentary.
‘This ultimately yielded another losing session, strengthening the downtrend,’ it said.
United Power Generation and Distribution Company led the turnover leaders with its shares worth Tk 28.82 crore changing hands.
The share price of the company, however, fell by 5.65 per cent or Tk 7.60 to Tk 128.10 on Monday after a buoyant debut in the previous trading session.
The share price of company had risen by 93.88 per cent or Tk 67.60 each on its debut to close at Tk 139.60.
Lafarge Surma Cement, Shasha Denims, IFAD Autos, ACI Limited, Square Pharmaceuticals, Grameenphone, Khulna Power Company and Pharma Aids were among the other most traded scrips.
Bangladesh Lamps gained the most on the day with a 12.01-per cent increase in its share price, while Dulamia Cotton was the worst loser of the day, shedding 8.97 per cent.