• Wednesday, November 26, 2014

Dhaka bourse to resume IPO scrutiny after a two-year pause

Sarwar A Chowdhury

The Bangladesh Securities and Exchange Commission has asked the premier bourse to restart scrutinising the draft IPO prospectuses and send recommendations to the regulator.

The move comes following a controversial listing of a chemical manufacturing company, which masked market-sensitive information about its directors in the IPO prospectus.

“We sat with the exchange officials last week, and decided that the bourse will submit its observations within 28 days of IPO prospectus submission to the regulator,” said Arif Khan, a commissioner of the BSEC.

 

He said they are also considering making public the draft prospectuses on the bourse's website for stakeholders' perusal.

The DSE had a listing committee until November 2011 that was responsible for analysing the draft initial public offering prospectuses in brief and making recommendations to the regulator.

The body was abolished upon a verbal instruction from the regulator following a conflict between the DSE and BSEC on the listing of a company.

But in April 2012, the prime bourse formed a 14-member expert panel to look into the companies' balance sheets, accounts, earnings per share, net asset value, business performance and growth, credit rating, valuation, risk factors and the IPO offer price in the prospectus.

The DSE once again dissolved the panel, as its observations were not evaluated by the securities regulator while giving consent to the IPO proposals.

Recently, the DSE at a board meeting also raised their concern over the controversial listing of a company.

On June 8, FAR Chemicals made a controversial debut on the stockmarket, as the company concealed market-sensitive information about its directors in its IPO prospectus that was a violation of securities rules.

The textile chemical manufacturer, however, made the concealed information public after an instruction from the BSEC.

Published: 12:00 am Tuesday, July 22, 2014

Last modified: 11:13 pm Monday, July 21, 2014

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