Shipping Corp’s share prices double in a week

Stocks of Bangladesh Shipping Corporation (BSC), a state-run listed ocean-going vessel management company, doubled in the last week thanks to the company's higher profit in the first quarter of the current financial year.

On December 26, the company disclosed its quarterly report saying its profits surged almost seven times to Tk 66 crore in the July-September period of 2022-23 while it was Tk 8.80 in the same period the previous year.

Soon after the disclosure, the company's stock price started to rise, soaring 111 per cent to Tk 104.6 as of last Thursday.

As the company's profits soared, the share price was hiked, which is a normal rise, according to a stockbroker. "This is a good sign," he said.

The company's profits rose due to higher revenue and other income and besides, foreign trade rose in the recent times following a contraction due to the ongoing coronavirus pandemic.

So as the economy is now opening up and international trade is on the rise, shipping management companies are doing well.

In addition, shipping freight charges rose worldwide, helping them make higher profits, he added. Freight revenue of BSC climbed around 92 per cent year-on-year to Tk 94 in the first quarter of the current financial year.

Similarly, the company's service revenue surged 218 per cent to Tk 19.55 crore compared to Tk 6 crore in the same period the previous year, its financial report shows.

The company's income from bank interest and other sources also rose 40 per cent to Tk 14 crore during the same period.

BSC logged higher profits in the financial 2020-21 year as well with Its profits jumping more than 73 per cent to Tk 72 crore compared to the year before.

Based on the higher profits, the company announced 12 per cent cash dividend on December 26 for shareholders.

However, many analysts are saying that the company's share price is  rising too fast and the regulator should investigate whether there is  any wrongdoings from manipulators.

The government holds a 52.1 per cent stake in the company while institutional investors hold 24.3 per cent and the general public holds 23.6 per cent, as per data from the Dhaka Stock Exchange.