UCB share price fall pulls down stock barometers

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FE Report
The drastic fall of share price of United Commercial Bank Limited (UCB), the day's top turnover leader pulled down the stock market barometers Thursday on Dhaka Stock Exchange (DSE).
The market faced a selling pressure from the frustrated investors of UCB when the bank management in an announcement said the shareholders whose names will appear in the record date on January 16 of 2008 will be entitled to receive 50 per cent stock dividend for the year 2006.
"The names of the shareholders as per record date of September 25, 2005, if still appears in the declared record date, will also be entitled to get 50 per cent bonus shares," the bank in a clarification, however, informed the DSE management.
Market sources said the UCB investors had anticipated that they will receive the dividends of 2003, 2004 and 2005 at an accumulated rate but the latest announcement frustrated them which caused the erosion of the prices that dipped by 10.43 per cent to Tk 3989.00 from the opening price Tk 4420.00.
"Such anticipation attracted investors to buy the UCB shares at Tk 6,300 per share on November 28, which has now dipped to Tk 3989.00 per share against the face value Tk 100 only," a DSE source said.
Meanwhile, the DSE management has referred the UCB issue to the Securities and Exchange Commission (SEC).
"We have expressed our concern on the development of UCB to the SEC as we smelt a rat behind the entitlement of dividend disbursement," a DSE source told the FE.
However, the total turnover rose to Tk 1.23 billion in the day's trading, dominated by losers, from previous day's Tk 1.20 billion.
All price barometers -DSE General Index (DGEN), All Shares Price Index (DSI) and DS 20- shed 24.78 points, 23.47 points and 3.49 points to close at 3003.87, 2523.23 and 2455.77 respectively on the day.
Out of 225 traded issues, prices of 118 declined, 89 advanced and 18 remained unchanged. The total market capitalisation came down to Tk 739.08 billion from previous day's Tk 744.81 billion.
UCB was the top turnover leader with Tk194.57 million traded.
Square Pharmaceuticals was the second turnover leader on the day with shares worth Tk 117.62 million traded followed by Prime Bank with Tk 61.98 million, Brac Bank with Tk 45.80 million, Uttara Bank with Tk 44.19 million, Summit Power with Tk 40.55 million, Shahjalal Bank with Tk 38.24 million, IBBL Perpetual Bond with Tk 37.14 million, Power Grid with Tk 37.03 million and NBL with Tk 33.82 million.
Phoenix Insurance and Popular Life Insurance were the two other major losers dropping by 8.44 per cent and 5.09 per cent respectively.
Prices of 45 out of 68 Z-category issues traded on the day witnessed continued rise.
Other Z-category issues-Bd Thai Aluminium, Bengal Biscuit, Gachihata and Rahman Cement -increased by 12.74, 12.24 and 12.00 per cent respectively.
Meanwhile, the Tallu Spinning will be placed in "Z" category from existing "B" category with effect from Sunday next as the company did not recommend any dividend for the year 2006-2007.