The central bank's continued tight monetary policy stance for the second half of FY26 is expected to benefit listed companies with cash surpluses, as they are likely to keep earning higher interest income.
Equity market participation may improve gradually, as declining yields on government securities and improving liquidity conditions may encourage a reallocation of funds from fixed-income instruments into equities after the election, according to EBL Securities' monetary policy analysis.
Currently, Treasury bond yields range between 10.23 per cent and 10.68 per cent for tenures of 2 to 20 years.
"This divergence between the policy rate and bond yields suggests a neutral-to-moderately positive outlook for the equity market, contingent on continued disinflation and macroeconomic stability," the analysis said.
Moreover, exchange-rate stability-supported by a market-driven exchange rate regime, strong remittance inflows, and improving foreign exchange reserves-may help gradually restore foreign investor confidence, EBL Securities noted.
Listed companies with significant import dependence are likely to see margin stability if input costs remain subdued due to exchange-rate stability and easing global commodity prices.
"Import-dependent sectors, particularly pharmaceuticals, are likely to benefit from foreign exchange stability, which may ease input cost volatility and support gross margin recovery," said Sheltech Brokerage.
Leading drug manufacturers such as Square Pharmaceuticals, Renata, Beximco Pharma, and Navana Pharma may see further increases in profitability.
On the other hand, highly leveraged listed companies are expected to continue facing elevated interest expenses, which will weigh heavily on their earnings, Sheltech Brokerage said. Such companies may also encounter funding constraints as borrowing costsremain high amid the tight monetary policy stance.
For instance, listed cement, steel, and real estate companies, as well as private-sector power generation firms that are already under stress, may face additional financial pressure.
Conversely, companies with substantial cash balances and fixed deposits are likely to continue reaping higher interest income.
Companies that have parked cash with banks or other financial institutions in the form of fixed deposit receipts (FDRs) or other instruments may negotiate for higher interest rates.
Some listed private-sector companies are also expected to find the changing lending rate regime favourable.
For example, Square Pharmaceuticals had net cash of nearly Tk 60 billion as of December last year and earns a substantial amount of interest income from these funds.
Cash-surplus state-run entities such as Jamuna Oil, Padma Oil, and Meghna Petroleum may also see their non-operating income remain elevated or increase further.
Selected banks and non-bank financial institutions with strong balance sheets are expected to benefit from the prevailing high interest rate environment through stronger net interest margins and potential mark-to-market gains on government securities amid declining yields.
Well-governed banks with high liquidity and low levels of non-performing loans are likely to experience continued growth in Treasury income.
BRAC Bank, City Bank, Eastern Bank, and Pubali Bank recorded significant year-on-year profit growth during the January-September period last year, buoyed by substantial gains from government securities.
In contrast, weaker financial institutions facing regulatory action under sector-wide reform measures are likely to see subdued investor interest until greater clarity emerges on the outcome of those actions.
However, the continuation of a high policy-rate environment keeps interest rates up, thereby increasing the cost of capital and financing costs for listed companies overall.
"This is likely to weigh on equity valuations and may keep earnings momentum modest in the near term despite improving macroeconomic stability," said the EBL analysis.
Moreover, low private-sector credit growth, coupled with persistently high interest rates, is expected to keep capacity expansion plans of listed companies on hold, resulting in muted investment activity and earnings growth in the near term.
babulfexpress@gmail.com
© 2026 - All Rights with The Financial Express
