The Bangladesh Securities and Exchange Commission (BSEC) has ordered an investigation into the unusual rise in the share price and suspicious trading activities of Regent Textile Mills Limited, a ‘Z’ category company listed on the capital market.
In a letter sent by BSEC’s Surveillance Department to the Chief Regulatory Officer of the Dhaka Stock Exchange (DSE) on Wednesday, the regulator directed the bourse to submit an investigation report within 30 working days.
The letter, signed by BSEC Assistant Director Jewel Hossain Sheikh, instructed the DSE to examine whether there was any planned collusion, market manipulation, or artificial trading among investors involved in transactions of the company’s shares. The investigation will also look into whether any individual or group benefited from undisclosed price-sensitive information.
Additionally, the probe will assess whether the brokerage firms and their representatives complied with the commission’s directives and existing regulations while facilitating transactions in the stock.
BSEC said market participants need to be more vigilant to prevent such suspicious trading activities and instructed brokerage firms’ chief executives, compliance officers, and representatives to be made aware of the issue. A copy of the directive was also sent to the Chittagong Stock Exchange (CSE) for necessary information.
According to market data, Regent Textile’s share price rose sharply from Tk 3.90 on April 30 to Tk 6.80 at the close of trading on June 17, representing an increase of nearly 74 percent in a short period.
The company has also failed to publish financial reports for several years. While it released audited financial statements for the 2020-21 fiscal year, no subsequent reports have been disclosed, leaving investors with little clarity about its current financial condition and business operations.
The latest available financial statements showed that the company incurred a net loss after tax of more than Tk 208 million in FY2020-21, compared with a loss of around Tk 40 million in the previous year. Earnings per share (EPS) stood at a loss of Tk 1.62, significantly higher than the previous year’s loss of Tk 0.31 per share. The company also did not declare any dividend for shareholders.
Listed on the stock market in 2015, Regent Textile has an authorised capital of Tk 1.5 billion and a paid-up capital of Tk 1.286 billion. Of its 128.61 million shares, sponsors and directors hold 54.55 percent, institutional investors own 4.61 percent, and general investors hold the remaining 40.84 percent.
