Big groups still reluctant to float shares for public

Most of the country's leading business groups and corporate entities are reluctant to go public due to multiple factors, company insiders said.
Among the major reasons, many companies prefer to avoid rules and regulations set for listed companies by the regulator and bourses.
Besides, many companies do not want any outsiders' influence and involvement in their hard-earned entities while some of them want to avoid misconducts that often take place in the AGM (annual general meeting).
"We have failed to create a fair environment of holding AGM of listed companies. That's why the companies having good fundamentals and managements maintain a distance from the capital market considering their prestige," Md. Shakil Rizvi, the former president of the Dhaka Stock Exchange (DSE), told the FE.
Rizvi said some of the groups are unwilling to raise funds from the capital market to run their business or further expansion as they fear the compliance set for listed companies.
"Some other companies do monopoly business. That's why they prefer bank loans for running business so that their business policy do not come to light," the former DSE president said.
Some of the elite business groups have also echoed with the former DSE president saying that they do not require going public as their companies are financially solvent to run their business themselves.
"May be our management believes that they are financially sound to run business. So, they do not want to give others the companies' stakes," said a senior executive of leading corporate group.
The Chittagong Stock Exchange (CSE) has moved to inspire the elite business groups in offloading shares of their companies for the sake of increasing the depth of the capital market.
"The CSE has taken preparation to hold a workshop in Chittaging in June this year where the Chittagong-based elite business groups will be invited in a bid to make them realise the benefits of going public," Syed Sajid Husain, the CSE managing director, told the FE.
Sajid said another workshop would be arranged in Dhaka in July this year by inviting the business groups having companies with good fundamentals and management backgrounds.
"Our goal is to increase the depth of the capital markets by bringing the companies of elite business groups," Sajid added.
Among the leading business groups, the Square, Beximco, ACI, Apex, Aftab, BSRM, Summit, Unique and Orion have offloaded shares of their one or more companies. Besides, many banks and the giant telecom company Grameenphone have offloaded their shares.     
According to information available in Dhaka Stock Exchange (DSE), the listed companies those groups accounted for 25.68 per cent of DSE's total capitalization.
Md. Moniruzzaman, the managing director of the IDLC Investments Limited, said most of the family-oriented companies do not prefer to go public for avoiding hassles of AGM where some rouge shareholders show misconducts.
"In the developed countries most giant companies are listed with the stock exchanges. But in country such culture is yet to be developed," said Moniruzzaman.
"A listed company has to open its books of accounts before the shareholders. They do not like the accountability to the outsiders although the capital market is best source of funding for the giant companies," Moniruzzaman added.