DSE suspends KPCL trading to halt sponsor Summit’s share sales - Share market analysis of dhaka stock exchange, Bangladesh
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08 November, 2018 09:55 AM Source: New Age
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 Dhaka Stock Exchange on Wednesday suspended the trading of the shares of Khulna Power Company Limited with an immediate effect following an initiative of a sponsor of the company to sell a significant number of shares at a bearish market.
DSE director Minhaz Mannan Emon said that the board of directors of the bourse at a meeting made the decision to hold up the share sales by the sponsor after the bourse failed to convince the sponsor not to sell the shares in the current situation of the market.
Minhaj also said that the sponsor had already sold a good amount of shares in the public market.
According to the news disseminated by DSE on November 4, Summit Corporation Limited, one of the sponsor-directors of the company, has expressed its intention to sell 1,80,64,235 shares out of its total holding of 6,37,34,727 shares of the company at the prevailing market price (in the public market) within next 30 working days.
The declaration came after KPCL disclosed higher profits and dividend for the year ended on June 30, 2018.
Sensing the move of the sponsor in advance, some investors began selling the shares of the company.
The share prices of the company reached Tk 139.3 on October 10 that plunged to Tk 98.4 on Tuesday.
On Wednesday, DSE Brokers Association and its board members discussed the current downward trend at the market and the issue of the sponsor selling the shares was raised by some of the members.
Minhaz said that investors felt helpless after the KPCL sponsor declared to sell those shares in the public market at the present situation of the market.
Sponsor-directors should sell shares in the block market.
DSE director Rakibur Rahman on Tuesday said that investors usually invested in a company seeing the company’s sponsors but if they saw that the sponsors were leaving the company, the general investors became disappointed.
He also said that the sponsor-directors should transact their shares in the block market, but Summit Corporation declared to sell the shares in the public market.
The declaration made investors more concerned about the market stability, he said.

 

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