Experts and stakeholders have expressed mixed opinion regarding re-listing of the companies which were de-listed from main bourses because of their non-performance.
Their opinion came following the tendency of the companies of OTC (over-the-counter) to be re-listed with main bourses. Three companies recently have applied to Dhaka Stock Exchange (DSE) to be re-listed with main bourses.
The companies are: Niloy Cement Industry, Sonali Paper & Board Mills and Apex Weaving and Finishing Mills.
Both the exchanges are in favour of modernising the OTC platform instead of re-listing them with main bourse.
"We think OTC board should be modernised not only for de-listed companies but also other non-listed ones in sync with the best practice of other countries," said Syed Sajid Husain, the managing director of Chittagong Stock Exchange (CSE).
The premier bourse is also in favor of modernising the OTC market as it is easy for market manipulators to play with shares of companies having small paid-up capital.
They said a company having paid-up capital below Tk 300 million should not be re-listed with main bourse.
In August, 2013 the securities regulator gave its consent to re-listing of Wata Chemicals and the company started trading on May 14, 2014 with a paid-up capital of only Tk 63.0 million.
Later, market manipulators played with shares of Wata Chemicals due to small paid-up capital.
On October 14 last, the securities regulator has formed a three-member body to formulate a guideline on as to how the aspirant companies of OTC market can be re-listed with main bourse.
"The non-performing companies of OTC market recently showed the tendency to be re-listed with the main bourse. Following this tendency, the BSEC took the decision of formulating a guideline for the sake of investors' interest," the BSEC said.
The BSEC body will submit its draft by November 15 next.
Meanwhile, the BSEC Wednesday last imposed a condition regarding rights issue of the companies, which will be re-listed from the OTC market, although the BSEC body is yet to formulate the draft on re-listing.
"The rights issuer of a company, which was de-listed from any stock exchange and traded through OTC market and again gets listed with any stock exchange, will not be allowed before completion of three financial years after re-listing," the fresh condition said.
Investment Corporation of Bangladesh (ICB) recently made a proposal of re-listing of the companies of OTC market under 'O' category as the ICB has investments in 40 companies.
The ICB recently invited the representatives of 40 companies of OTC market to know their opinion regarding the re-listing. Representatives of eight companies attended the meeting and said they are unable to come to main bourse due to high fee for re-listing and share demate.
"At the meeting, ICB Managing Director Md. Fayekuzzaman stressed on holding AGM and disbursement of dividends by the companies of OTC market," a meeting source said.
 Former chairman of the securities regulator Faruq Ahmad Siddiqi said the securities regulator will look into whether a company has achieved the eligibility to be re-listed with main bourse.
"It's also true that manipulators play with the shares of companies having small paid-up capital. That's why the guideline, which will be formulated by BSEC body on companies' re-listing, should include measures to reduce the scope of price manipulation," Siddiqi said.
Siddiqi expressed his surprise as the securities regulator has already imposed a condition reading the rights issue of the companies which will be re-listed from OTC market although the BSEC body is yet to submit its report on re-listing.
In this regard, BSEC executive director Mohammad Saifur Rahman said the condition will be applicable for the companies that have already been re-listed from the OTC market. "And the BSEC body will submit report to formulate the overall guideline on re-listing."
Presently, there are 66 companies in the OTC market including three which have applied to go main market.
According to a DSE official, a company willing to be re-listed with main bourse must have production continuity along with maintaining books and accounts properly, holding AGM (annual general meeting) and giving dividends regularly.
He said the companies willing to be re-listed with main bourse needs the NOC (no objection certificate) from the securities regulator as those ones were de-listed as per regulatory directive.
"However, the re-listing of the companies of OTC market will depend on the decision of exchange authority and the securities regulator," the DSE official said on the condition of anonymity.
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