Angry investors protest DSE share price fall

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Refayet Ullah Mirdha
A group of angry investors Thursday staged a demonstration in front of the country's premier bourse, Dhaka Stock Exchange (DSE), protesting against the price fall of shares following a decision taken by the stock market regulatory body Monday last.
Share prices on the DSE have been undergoing a massive correction for the last three days as the Securities and Exchange Commission (SEC) asked merchant banks and brokerage houses to suspend loan disbursement to small and unemployed investors.
Stock prices on the DSE continued to decline Thursday for the third day in a row as DSE General Index (DGEN), DSE-20 Index (DS20) and All Shares Price Index (DSI) shed 26.733 points, 23.247 points and 22.739 points to close at 2958.199, 2356.441 and 2504.189 respectively.
The angry investors numbering more than 300 started gathering from 11:00am and the demonstration continued until 2:00pm in front of the DSE.
Law enforcing agencies rushed to the spot, cordoned off the whole area and brought the situation under control without any major untoward incident.
During the incident the angry investors tried to ransack the office of the DSE, but the police quelled them, eyewitnesses said.
"Actually we the retail investors are not the beneficiaries, though the SEC took the decision to save the retail investors. In fact the middle and higher level investors have bought majority shares from the retail investors taking the advantage of the SEC decision," said an angry investor.
"We demand immediate withdrawal of the SEC decision for revival of the stock market," he said.
The angry investors tried to submit a memorandum to the Chief Executive Officer (CEO) of the DSE, but the CEO was not present in his office on the day as he was on an official visit to Chittagong to inaugurate the DSE bureau office there.
As part of the demonstration, another section of the angry investors rushed to the office of the SEC to convey their worry to its chairman over losses incurred due to the latest regulatory decision.
"I along with other investors have come here to inform the SEC office of the downtrend in prices of stocks. But, unfortunately, he is also on a visit to Chittagong. So, we are going back," said Nasir Ahmed in front of the SEC office.
He said the SEC suspended the opportunity of receiving loans from merchant banks and brokerage houses by the small and unemployed investors.
Officials of both SEC and DSE also could not be reached as they were on a visit to Chittagong.
The Merchant Bankers' Association of Bangladesh (BMBA) was scheduled to submit a memorandum to the chairman of the SEC seeking withdrawal of the ban on loan disbursement by the merchant banks and brokerage houses.
But, they could not file the memorandum as the SEC chairman was on the official visit to Chittagong.
The SEC Monday last asked the merchant banks and brokerage houses to suspend portfolio loan disbursement with effect from Tuesday last until further order.
Market operators said the SEC action came in the backdrop of an over-heated market.
The loan facilities extended by the merchant banks and some of the brokerage houses to the retail investors played an important role in triggering a bullish trend in the market during the past few months.
The SEC took the move as it apprehended that the share market was becoming quite 'risky' for the investors, especially for those involved in retail trading because of the large gap between demand for, and supply of, quality shares, said a senior SEC official.
Market operators said normally the prices of shares decline when the flow of money is tightened.
The trend of price correction of over-priced shares might continue for some days, they observed.
Talking to the FE, a chief executive officer (CEO) of a brokerage house said the SEC should look for an alternative to the decision to keep the market stable.
However, the total turnover Thursday dropped to Tk 1.427 billion (142.7 crore) from the previous Tk 1.477 billion. The total market capitalisation also declined to Tk 731.437 billion from Tk 736.962 billion of Wednesday last.
In a market dominated by losers, out of 215 traded issues, prices of 50 gained, 147 declined and 18 remained unchanged.
BRAC Bank was the turnover leader with its shares worth Tk 137.911 million traded, followed by Power Grid with Tk 91.099 million, Trust Bank with Tk 63.198 million, Islami Bank with Tk 62.820 million, UCBL with Tk 44.560 million, Lafarge Surma Cement with Tk 40.276 million, Grameen One with Tk 38.728 million, Social Investment Bank with Tk 37.249 million, Uttara Bank with Tk 35.742 million and Square Pharma with Tk 33.614 million.
Prices of BRAC Bank shares declined 0.75 per cent to Tk 1578.50 each, Power Grid 0.94 per cent to Tk 684.50, Trust Bank 2.44 per cent to Tk 1007.75, Islami Bank 1.65 per cent to Tk 6790.50, UCBL 1.43 per cent to Tk 5285.00, Grameen One 1.24 per cent to Tk 79.60 and Square Pharma 0.96 per cent to Tk 3352.50.
Lafarge Surma Cement gained 2.66 per cent to Tk 442.25, Social Investment Bank 0.42 per cent to Tk 527.50 and Uttara Bank 0.38 per cent to Tk 4450.25.
Market sources said the prices of Lafarge Surma Cement shares gained on the day mainly on the speculation that a verdict of the Supreme Court of India on extraction of limestone from the Meghalaya Province might favour the Lafarge authorities.