Large-cap shares drag Dhaka stocks down

ACI led the fall in the Dhaka Stock Exchange yesterday as the conglomerate's first quarter earnings plunged by more than 70 percent year-on-year.

ACI's shares closed down 8.15 percent to Tk 363.50, way below Tk 583 recorded on November 12 last year, meaning the company's stock price decreased by nearly 38 percent in the last five months.

One of the largest Bangladeshi conglomerates with exposure to pharmaceuticals, consumer brands, and agribusiness, ACI has been witnessing a sharp fall in its earnings in the last six months.

The company's earnings were Tk 5.63 a share in October-December of 2017, down from Tk 7.95 in the same period a year ago. Sliding quarterly earnings disclosure of some other companies also impacted the DSE negatively. 

Consequently, the DSEX, the benchmark index of the bourse, shed 74.56 points, or 1.28 percent, to close the day at 5,739.22.

"The quarterly earnings of some listed companies have hurt investors' expectation, leading some of them to reshuffle portfolio," said Md Moniruzzaman, managing director of IDLC Investments.

 He, however, said there is nothing to worry because many companies saw a rise in their earnings too. "So, the market will revive very soon."

Market insiders said the DSEX was pulled down by the huge sell pressure of ACI shares. In the January to March quarter, consolidated EPS of ACI was down 72.09 percent year-on-year to Tk 0.96.

In fact, it had been in the declining mood in the previous quarter as well, when the EPS fell 29.18 percent year-on-year to Tk 3.44.

"Overall, the quarterly earnings of the listed companies are not that bad. But at the time of earnings declaration, the index normally remains downturn," said Mir Ariful Islam, head of research of Prime Finance Asset Management Company.

Yesterday, the market started the day on a negative note, which continued until the end as investors remained cautious and adopted the wait-and-see approach, said EBL Securities in its daily market review.

The review said earnings declarations from several listed companies failed to meet investors' expectation.

Turnover, another important indicator of the market, declined 8 percent to Tk 592.76 crore, with 15.49 crore shares and mutual fund units changing hands.

Of the traded issues, 73 advanced, 227 declined and 37 closed unchanged.

Beximco dominated the turnover chart with its 1.53 crore shares worth Tk 48.54 crore changing hands, followed by Brac Bank, Square Pharma, Navana CNG and United Power Generation. Among the major sectors, banking dropped 1.7 percent, pharmaceuticals 1.47 percent and engineering 1 percent. Conversely, the shares of the textile sector rose 0.14 percent.

Queen South Textile was the day's best performer with a 9.97 percent gain, followed by Navana CNG, Miracle Industries, and Western Marine Shipyard. Bank Asia was the worst loser, shedding 12.44 percent.

As yesterday was the first trading day for the private bank after the record date of dividend declaration, there was no cap on how much it can go up or down.

Other major losers include Sonargaon Textile, Tosrifa Industries, Premier Leasing, Aramit Cement and ACI. Chittagong stocks also fell yesterday as the bourse's key index, CSCX, shed 138.37 points or 1.3 percent to finish at 10,697.73.

Losers beat gainers as 49 advanced, 165 declined and 14 finished unchanged on the Chittagong Stock Exchange.  The port city bourse traded 96.11 lakh shares and mutual fund units worth Tk 34.79 crore.