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Peninsula Ctg price rising sans PSI

Company's share price jumps 52pc in a month


FE REPORT | October 04, 2021 00:00:00


The Peninsula Chittagong is witnessing an unprecedented price hike and increase in volume of shares in recent days though it has no undisclosed price sensitive information (PSI).

Within a month, the hotel based service oriented company's stock price jumped about 52 per cent to close at Tk 34.50 on Sunday, after hitting two years' highest price on Dhaka Stock Exchange (DSE).

The company's share price was Tk 23.30 a month earlier. The Chittagong-based company's share traded between Tk 14.50 and Tk 35.70 each in the last two years, according to DSE statistics.

Following the recent 'abnormal' price hike, the DSE served show-cause notice on the company on Sunday.

The company in a knee-jerk response to the DSE said: There is no undisclosed price sensitive information of the company for recent unusual price hike and increase in volume of shares.

However, the company's share price dropped 2.27 per cent on Sunday after the DSE's notice.

Investors were optimistic and buying the hotel's stock anticipating brisk business ahead as tourism and hospitality industry is rebouncing gradually due to improving pandemic situation, said an analyst at a leading brokerage firm.

Recently, the company announced that its board accepted a 30-year lease agreement with the Chittagong Port Authority for an additional 0.3 acres of land, which might have also attracted investors, he said.

The land is adjacent to the Chittagong Airport and Peninsula's second five-star hotel project. The second hotel in Chattogram is under construction, and need the extra land for its beautification, said a company official.

The investors should be cautious about buying overvalued stocks in order to avert any misfortune, said a merchant banker.

Share prices of many companies are on the rise, although transaction and price movement of these companies' shares do not match their fundamentals, he said.

He noted that some influential investors by disseminating rumours are trying to manipulate the prices of shares of the companies under question.

"Investors need to be cautious and should not pay heed to any rumours related to companies and take their investment decisions prudently," he added.

The Peninsula Chittagong, which was listed on the DSE in 2014, disbursed a 10 per cent cash dividend for the year ended on June 30, 2020. In 2019, it provided a 7.50 per cent cash dividend.

The company's earnings per share (EPS) for nine months stood at Tk 0.46 for July 2020-March 2021, as against Tk 0.41 for the same period of the previous year.

The company's paid-up capital is Tk 1.18 billion and authorised capital is Tk 3.0 billion, while the total number of securities is 118.66 million.

The sponsor-directors own 45.93 per cent stake in the company, while institutional investors own 9.90 per cent, foreign investors 0.10 per cent and the general public 44.07 per cent as on August 31, 2021, the DSE data showed.

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