Three DSE stocks flying amid bearish trend
The three companies are Mithun Knitting and Dyeing, Yeakin Polymer, and Bangladesh Industrial Finance Company (BIFC)
The shares of three loss-making companies skyrocketed at the Dhaka Stock Exchange (DSE) despite the market witnessing a prolonged bearish trend for seven consecutive sessions.
The three companies are Mithun Knitting and Dyeing, Yeakin Polymer, and Bangladesh Industrial Finance Company (BIFC).
According to DSE data, Mithun Knitting shares jumped over 73%, while BIFC stocks surged 42%, and Yeakin Polymer rose 21% in the last 10 days until last Tuesday.
At the end of Tuesday's trading session, Mithun Knitting shares closed at Tk32.70, Yeakin Polymer at Tk21, and BIFC at Tk8.40.
Despite the benchmark index DSEX of the DSE dropping by 320 points over the previous seven consecutive days to settle at 5,371 by Tuesday, due to a lack of investor confidence, liquidity crunch, and rising interest rates, some shares still saw significant gains, according to market insiders.
They added that the three companies leading the gainers' chart were loss-making, which is a sign of market manipulation.
A top official from a stock brokerage firm said that Mithun Knitting shares soared mainly due to a rumor of an ownership change, with speculation that a China-based company has recently shown interest in investing in the company.
However, the company now exists only on paper, as the Chattogram Economic Zone seized its assets for non-payment of rent and other charges.
Meanwhile, insiders stated that there was no fundamental reason for the unusual price hike of Yeakin Polymer and BIFC.
In January, Yeakin Polymer secured approval from the Bangladesh Securities and Exchange Commission for an ownership change.
As per the regulator's letter, Yeakin Polymer's sponsors and directors' stake will transfer to Kapita Packaging Solutions Limited – a non-listed firm.
The company has not published its financial results since FY21. Now, it has filed a petition with the High Court to secure approval to conduct the pending annual general meeting.
BIFC has been incurring losses for years due to its mounting high non-performing loans, as reported by the Bangladesh Bank. The report stated that the company's owners embezzled the company's funds.