Miracle Industries, a company with a troubled financial track record, has seen its stock price surge on the Dhaka Stock Exchange (DSE) over the past month, despite a lack of fundamental reasons for the spike.
As its factory has been suspended for four years due to a working capital shortage, the company has posted losses for the past five financial years. The cumulative losses amounted to Tk 513 million at the end of FY24, and it incurred an additional Tk 28.52 million in losses in the first quarter of FY25.
The stocks of Miracle Industries, which manufactures different types of bags for cement, fertiliser, salt, feed, sugar, food grains, and chemicals, had been trading under the 'Z' category since May this year, as it failed to pay dividends after FY20, when it declared a merely 1 per cent cash dividend.
Despite the grim performance, the company's stock price continued to soar and jumped nearly 28 per cent this week, becoming the week's top gainer.
The company's stock price surged an astounding 70 per cent just over a month to Thursday although there is no disclosure of price-sensitive information.
Such an unusual price movement in recent times prompted the prime bourse to serve a show-cause notice on the company, enquiring about the reasons behind such a hike.
The company replied with a knee-jerk response on Thursday, saying there is no undisclosed price-sensitive information.
However, its stock price shed 3.02 per cent to close at Tk 28.9 on Thursday after the show-cause notice.
The total number of securities of the company is 35.21 million.
Market analysts suspect that manipulation is the reason behind the "abnormal price" surge as non-performing stocks are dominating the market nowadays.
A vested group that does not care about the companies' actual performance is targeting these firms as they have a low number of shares, making them easy to manipulate, said a leading broker, requesting not to be named.
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