Govt assurance of offloading SoEs shares gets stuck again
Sunday, 12 December 2010
The government assurance of offloading its holdings in eight listed state-owned enterprises (SoEs) within 20 days to stabilise the often-volatile stock market apparently got stuck in bureaucratic tangles.
Almost 41 days have passed since the government declaration of offloading shares of SoEs but there is no clear indication yet about the progress of the move.
Market observers claim that most of the shares are being overvalued mainly due to short supply of quality shares, which is certainly not a sound indicator of a stable market
The offloading of additional shares of the eight SoEs, market analysts think, will strengthen the supply side in the market, where demand for new shares is increasing every day with the entry of thousands of fresh investors.
The SoEs from which the government intends to offload its shares are Titas Gas, Atlas Bangladesh, Desco, Powergrid, Meghna Petroleum, Padma Oil, Bangladesh Shipping Corporation (BSC) and National Tubes.
While talking to UNB, Chittagong Stock Exchange (CSE) President Fakhor Uddin Ali Ahmed said: "Most of the shares have become overvalued. We urgently need to increase the flow of good shares in the market."
Asked to comment on the delay in offloading government shares, he said the market urgently needs supply of shares, both of private and public companies, to keep it stable.
"Long-, mid- and short-term measures will have to be taken to attract new companies and keep the supply side vibrant. I believe, the government is sincere to offload its shares in the SoEs but it will have to be harsh to keep its promises," he said.
CSE president also said that the market needs strong regulation to avert any disarray. "Securities and Exchange Commission (SEC) should increase its workforce to ensure strong monitoring over the market."
Dhaka Stock Exchange (DSE) Director M Rakibur Rahman said he had requested the finance minister to transfer the officials who are creating obstacles in offloading government shares and bring dynamic people in their places to accomplish the urgent task.
"Almost all shares are overvalued. The investors should be careful in buying shares. It'll be better to wait for initial public offerings (IPOs). Market is very volatile right now," he said.
Mr Rahman hoped that the market would get a good number of quality shares by March next year.
Almost 41 days have passed since the government declaration of offloading shares of SoEs but there is no clear indication yet about the progress of the move.
Market observers claim that most of the shares are being overvalued mainly due to short supply of quality shares, which is certainly not a sound indicator of a stable market
The offloading of additional shares of the eight SoEs, market analysts think, will strengthen the supply side in the market, where demand for new shares is increasing every day with the entry of thousands of fresh investors.
The SoEs from which the government intends to offload its shares are Titas Gas, Atlas Bangladesh, Desco, Powergrid, Meghna Petroleum, Padma Oil, Bangladesh Shipping Corporation (BSC) and National Tubes.
While talking to UNB, Chittagong Stock Exchange (CSE) President Fakhor Uddin Ali Ahmed said: "Most of the shares have become overvalued. We urgently need to increase the flow of good shares in the market."
Asked to comment on the delay in offloading government shares, he said the market urgently needs supply of shares, both of private and public companies, to keep it stable.
"Long-, mid- and short-term measures will have to be taken to attract new companies and keep the supply side vibrant. I believe, the government is sincere to offload its shares in the SoEs but it will have to be harsh to keep its promises," he said.
CSE president also said that the market needs strong regulation to avert any disarray. "Securities and Exchange Commission (SEC) should increase its workforce to ensure strong monitoring over the market."
Dhaka Stock Exchange (DSE) Director M Rakibur Rahman said he had requested the finance minister to transfer the officials who are creating obstacles in offloading government shares and bring dynamic people in their places to accomplish the urgent task.
"Almost all shares are overvalued. The investors should be careful in buying shares. It'll be better to wait for initial public offerings (IPOs). Market is very volatile right now," he said.
Mr Rahman hoped that the market would get a good number of quality shares by March next year.