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DSE launches new index with quality large cap cos

Aim is to woo foreign equity funds

FE REPORT | December 31, 2019 00:00:00

The Dhaka Stock Exchange (DSE) launched a new index on Monday as part of the business and technical collaboration initiatives with its Chinese strategic partners.

The new index - CNI-DSE Select Index (CDSET) - includes 40 well-performing large companies of the market, based on their present market capitalisation, profit and liquidity.

The index will create scopes of newer opportunities and better collaboration between the DSE and its strategic partners, chairman of the bourse Prof Dr Abul Hashem said while inaugurating the index in a programme at DSE building in the capital's Nikunja area.

"We have launched the CNI-DSE Select Index, which will represent the largest percentage of capitalisation of the investable universe of the country's capital market."

He expressed the optimism that the new index will attract more foreign investors to the country's capital market, which will help promote its branding in the global market.

Mr Hashem also said they have a long-term cooperation plan in key areas, such as - technology, market cultivation and product development etc, to ensure further growth of the country's capital market as well as the economy.

He noted that they have also planned to launch size-based indices, like - CNI-DSE large-cap index, CNI-DSE mid-cap index and CNI-DSE small-cap index, in the coming days as part of the technical collaboration plan.

Abdul Matin Patwary, acting managing director of the DSE, said the large-cap index will track performance of large-cap stocks that will represent the largest percentage of the market capitalisation.

He said that the mid-cap index will track a diverse basket of medium-sized listed companies. The small-cap index will provide broad exposure to the small-cap companies' capitalisation in the country's equity market, and investors will be able to track an index of small-sized companies.

He added that they have just achieved the first milestone in coping up with the future business needs in line with the value addition proposal of strategic investors as well as part of the DSE indices development plan.

The base value of the new index is 1,000 points, and the base date is December 31, 2015. Performance of the companies will be reviewed twice a year.

However, the DSE will officially open the index for investors from tomorrow (Wednesday) on its website.

The index is designed and developed by the Shenzhen Securities Information Company, a subsidiary of the Shenzhen Stock Exchange (SZSE) and the DSE, as part of the technological support, promised by the DSE's strategic partners - the SZSE and the Shanghai Stock Exchange (SSE).

A Chinese consortium, consisting of the SZSE and the SSE, became the DSE's strategic partner in May last year by purchasing the bourse's 25 per cent stake worth about Tk 9.47 billion.

Besides, the Chinese consortium will provide technical support worth nearly US$ 37 million for free.

Currently, the DSE has three indices - the DSE Broad Index, DSE 30 Index and DSE Shariah Index.

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