DSE to update PE ratio of cos daily to help investors

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Mohammad Mufazzal
Dhaka stock exchange will update price-earning (PE) ratio of all its listed companies everyday based on their latest quarterly reports in an effort to facilitate lending facilities to the investors, its president said Saturday.
The move has been taken after the Securities and Exchange Commission last week ordered the banks not to lend investors for purchase of a company's shares whose PE ratio has crossed 75.
DSE president Md. Rakibur Rahman said the country's premier bourse is developing a software, which would automatically update PE ratio of all companies trading shares in the capital market.
"We hope to start using the software by Thursday. We are developing it fast to make sure that no investor is deprived of loan facilities due to delayed information on a company's latest PE ratio," he told the FE.
Officials said the DSE has already calculated the PE ratio of 139 companies based on their latest quarterly reports to stave off any misunderstanding whether or not shares of any of these companies qualify for lending facilities.
"Our Information and Technology (IT) and Research department are giving final touches to the software. The investors will be able to watch the PE ratio in the company's profile everyday through auto calculation by the software," a DSE official said.
He said the brokerage houses and merchant banks will provide margin loans after watching the company's web-profile and latest PE ratio automatically calculated by the software in real time.
"The companies, which have not been able to submit their quarterly reports, will have their PE ratio calculated based on half yearly reports," he added.
"In such a situation, there will be a provision of penalty on these companies for not giving the latest information for the convenience of margin loans," he said, speaking on condition of anonymity.
According latest directive of the SEC, the brokerage houses and merchant banks are allowed to extend loan facilities against the shares of the companies whose PE ratio is 75 or below.
Mutual funds, non-demated shares, poor performing Z-category companies, newly listed firms and the companies whose share status has been downgraded or upgraded won't come under latest the order.