The securities regulator has asked the Dhaka bourse to investigate the unusual movements of the stock price and trade volume of the loss-making company Dulamia Cotton Spinning Mills.
Despite losses for five consecutive years through FY24, the company witnessed an abnormal price surge of its stock -- 102 per cent to Tk 132 each share on the Dhaka Stock Exchange (DSE) on Thursday since June 23.
In an order issued on Wednesday, the Bangladesh Securities and Exchange Commission (BSEC) said the stock's movement and trade volumes looked 'unusual and suspicious'.
As per the regulatory order, the DSE will have to submit an inquiry report within the next 30 days.
Dulamia Cotton Spinning Mills is not in operation and it said in a DSE filing on August 25 that the company was surprised and worried following the unusual increase in the market value of its shares.
According to the stock exchange filing, there are no operational or structural changes in the company or any incident that might have an impact on the price or trade volume of the company's shares.
The stock of Dulamia Cotton Spinning Mills closed at Tk 65.30 each share on June 23 and later rose to Tk 92.90 per share on July 22.
It experienced another hike of 42 per cent and finally closed at Tk 132 on Thursday on the DSE.
Dulamia Cotton, which experienced losses between Tk 6.66 million and Tk 10.35 million in FY20-FY24, has no record of distributing dividends on the website of the premier bourse.
Previously, the DSE said on its website that an inspection team visited the factory of Dulamia Cotton Spinning Mills on September 24, 2023 for examining their operational status.
The team could not enter the factory of the company and could not perform their duty as the factory was closed and sealed.
Meanwhile, the company received a qualified opinion from its auditor due to mismatches in the financial statement for the period ended in June last year.
The company's accumulated loss stands at Tk. 378.61 million.
Its liabilities exceed its assets worth Tk 19.64 million by Tk. 296.80 million.
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