bdnews24.com :
Power and energy sector companies have gained most on a day when trading on Dhaka Stock Exchange crossed Tk 10 billion amidst a bull run in capital markets.
Of the 10 companies that gained most on Monday, seven were from this sector.
Three companies of Summit Group – KPCL, Summit Power, SPCCL – alone accounted for 17 percent of the day’s trading.
Market analysts feel a cut in bank deposit interests and optimism about the budget to be placed on June 4 spurred the buying.
Former DSE president Shakil Rizvi said the present trend would continue if the country’s political situation remained stable.
Turnover at the DSE on Monday was over Tk 10.02 billion, the highest transaction volume in the last seven and a half month.
Even at the beginning of May, the average trading was below Tk 3 billion. The DSE index, which was 4970 points at the beginning of the year, plunged to 3960 points on May 4.
But it gained around 664 points in the last one month to close at 4624 points on Monday.
“At present all the economic indicators are good. There is also political stability. The rate of interest on bank deposits too has been slashed,” Rizvi said. “There is a sense of expectation about the budget. If the political stability persists, the market will flourish.”
After the government reduced the interest rate on savings certificates, nationalised commercial banks followed suit by cutting interest rates on fixed deposit up to 0.50 percentage points. The new rates took effect from Monday.
President of the Bangladesh Merchant Bankers Association Md A Hafiz said the cut in interest rates was driving many to invest in the stock market.
“The lowering of the interest rate is good news for the market. Some money will now be pumped into it,” he told bdnews24.com.
The Internal Resources Division of the finance ministry on May 23 reduced the interest rates up to 1.9 percent on five savings certificates.
Managing Director of the IDLC Investment Limited Md Muniruzzaman was, however, not quite optimistic.
“Economic indicators do not always determine Bangladesh’s capital market. So it cannot be said with certainty that the market will grow because of the cuts in interest rates.
“Prices of many shares have fallen. There is scope for growth though,” he said.
He pointed to the performance of the power and energy sector companies.
“There is no new development in this sector. Maybe, because share prices were low, investors showed interest in that sector.”
The top ten leading companies in terms of trading on Monday were KPCL, Summit Power, GP, BEXIMCO, SAIFPOWER, BARKAPOWER, SPPCL, UPGDCL, LAFSURCEML and MJLBD.
Apart from GP, BEXIMCO and LAFSURCEML, all other companies are from energy sector.
Even last week, companies from this sector topped the list of high gainers.
Tk 1.5 billion worth of shares of top two companies, KPCL and Summit Power, were traded on Monday, which was 15.10 percent of the day’s total transactions.
KPCL’s share price, however, dropped by Tk 1.10 on Monday. It was traded for Tk 83.30.
The share price of Summit Power, which is owned by the same group, increased by Tk 2.30. It was last traded at Tk 43.
Market analysts say these two companies had made substantial profits last year and gave attractive dividends to investors.
Moreover, they say, investors are hopeful that earning per share of Khulna Power will be good in the first quarter (January-March).
The recent announcement of the Summit Group that it would invest $1 billion in the power sector also made investors eager about the companies owned by the group, the analysts felt.
Power and energy sector companies have gained most on a day when trading on Dhaka Stock Exchange crossed Tk 10 billion amidst a bull run in capital markets.
Of the 10 companies that gained most on Monday, seven were from this sector.
Three companies of Summit Group – KPCL, Summit Power, SPCCL – alone accounted for 17 percent of the day’s trading.
Market analysts feel a cut in bank deposit interests and optimism about the budget to be placed on June 4 spurred the buying.
Former DSE president Shakil Rizvi said the present trend would continue if the country’s political situation remained stable.
Turnover at the DSE on Monday was over Tk 10.02 billion, the highest transaction volume in the last seven and a half month.
Even at the beginning of May, the average trading was below Tk 3 billion. The DSE index, which was 4970 points at the beginning of the year, plunged to 3960 points on May 4.
But it gained around 664 points in the last one month to close at 4624 points on Monday.
“At present all the economic indicators are good. There is also political stability. The rate of interest on bank deposits too has been slashed,” Rizvi said. “There is a sense of expectation about the budget. If the political stability persists, the market will flourish.”
After the government reduced the interest rate on savings certificates, nationalised commercial banks followed suit by cutting interest rates on fixed deposit up to 0.50 percentage points. The new rates took effect from Monday.
President of the Bangladesh Merchant Bankers Association Md A Hafiz said the cut in interest rates was driving many to invest in the stock market.
“The lowering of the interest rate is good news for the market. Some money will now be pumped into it,” he told bdnews24.com.
The Internal Resources Division of the finance ministry on May 23 reduced the interest rates up to 1.9 percent on five savings certificates.
Managing Director of the IDLC Investment Limited Md Muniruzzaman was, however, not quite optimistic.
“Economic indicators do not always determine Bangladesh’s capital market. So it cannot be said with certainty that the market will grow because of the cuts in interest rates.
“Prices of many shares have fallen. There is scope for growth though,” he said.
He pointed to the performance of the power and energy sector companies.
“There is no new development in this sector. Maybe, because share prices were low, investors showed interest in that sector.”
The top ten leading companies in terms of trading on Monday were KPCL, Summit Power, GP, BEXIMCO, SAIFPOWER, BARKAPOWER, SPPCL, UPGDCL, LAFSURCEML and MJLBD.
Apart from GP, BEXIMCO and LAFSURCEML, all other companies are from energy sector.
Even last week, companies from this sector topped the list of high gainers.
Tk 1.5 billion worth of shares of top two companies, KPCL and Summit Power, were traded on Monday, which was 15.10 percent of the day’s total transactions.
KPCL’s share price, however, dropped by Tk 1.10 on Monday. It was traded for Tk 83.30.
The share price of Summit Power, which is owned by the same group, increased by Tk 2.30. It was last traded at Tk 43.
Market analysts say these two companies had made substantial profits last year and gave attractive dividends to investors.
Moreover, they say, investors are hopeful that earning per share of Khulna Power will be good in the first quarter (January-March).
The recent announcement of the Summit Group that it would invest $1 billion in the power sector also made investors eager about the companies owned by the group, the analysts felt.
