The Bangladesh Securities and Exchange Commission (BSEC) has ordered an investigation into the sharp rise in the share price and trading volume of SME-listed Al-Madina Pharmaceuticals Ltd., amid concerns over possible market manipulation and insider trading.

According to BSEC sources, the regulator has assigned the Dhaka Stock Exchange (DSE) to conduct the investigation instead of carrying it out directly. The DSE has been instructed to submit a comprehensive report to the commission within 30 working days.

The investigation will examine the reasons behind the company’s unusual share price appreciation and the significant increase in trading activity.

The move comes after Al-Madina Pharmaceuticals’ share price surged 185.51% over the past five months without any disclosure of price-sensitive information (PSI) or major business developments. The stock rose from Tk 35.90 on February 19 to Tk 102.50 on July 5, gaining Tk 66.60 per share. Over the past two and a half months alone, the share price climbed 112.5%.

On July 5, the DSE sought an explanation from the company regarding the unusual price movement. In response, the company said it had no undisclosed information that could explain the rise.

The BSEC investigation will determine whether coordinated market manipulation or insider trading involving undisclosed price-sensitive information took place. It will also examine whether stock brokers, dealers and their representatives complied with margin rules and regulatory directives.

The probe will specifically review the possible involvement of UCB Stock Brokerage Ltd. and United Financial Trading Company Ltd. in facilitating or failing to prevent suspicious transactions.

Market participants have also raised concerns over a possible link between the stock’s price rally and BSEC’s recent approval allowing Royal Footwear PLC, a company owned by Al-Madina Pharmaceuticals’ sponsors, to raise Tk 120 million through a Qualified Investor Offer (QIO). They have called for a thorough review of whether the company’s sponsors or officials had any role in the unusual trading activity.

Al-Madina Pharmaceuticals was listed on the SME platform in 2023 and has a paid-up capital of Tk 204 million, with 24 million outstanding shares. As of June 30, 2026, sponsors held 55% of the shares, institutional investors 11.56%, and general investors 40.44%.

The company’s financial performance has weakened since listing. Earnings per share (EPS) fell from Tk 1.57 in its listing year to Tk 0.87 the following year and further to Tk 0.58 in 2025. Sponsor shareholding also declined from 69.85% on June 30, 2025, to 55% a year later.