Insurance leads stocks’ gain

Insurance stocks led the capital market yesterday thanks to a regulatory order to abide by rules, including maintaining the minimum paid-up capital requirement.

The DSEX, the Dhaka Stock Exchange's (DSE) benchmark index, rose 19 points, or 0.32 per cent, to 5,820 yesterday.

Among the listed 49 insurance stocks, 46 advanced and the rest remained unchanged.

The Insurance Development and Regulatory Authority (IDRA) issued an order on January 17 asking all insurance companies to raise sponsor shareholdings to 60 per cent and maintain a minimum paid-up capital of Tk 30 crore to 40 crore.

The regulator also asked them to inform of compliance within 30 working days.

Life insurance companies need to maintain a minimum paid-up capital of Tk 30 crore. For non-life insurers it is Tk 40 crore.

The overvalued insurance sector has got more fuel to make a big jump, said a stock broker preferring anonymity.

Among the top 20 on the gainers' list, 17 were from the insurance sector. Green Delta, Agrani and Pragati nearly had no one selling their stocks and rose 10 per cent.

But that list was crowned by Energypac Power Generation, rising 50 per cent on its debut day. There was also none of the stock for sale.

Market capitalisation of the insurance sector increased by 9.54 per cent while that of life insurance 5.32 per cent, according to the daily market review of LankaBangla Securities.

Turnover, an important indicator of the market, dropped 15 per cent to Tk 1,290 crore.

Robi Axiata was the most-traded stock, worth Tk 146 crore, followed by Beximco, Summit Power, Beximco Pharmaceuticals and LankaBangla Finance.

Padma Oil Company shed the most falling 7.83 per cent followed by Delta Spinners, National Bank, Dhaka Electric Supply Company (Desco) and Zeal Bangla Sugar Mills.

The port city bourse also rose yesterday. The general index of Chittagong Stock Exchange, the CASPI, increased 29 points, or 0.17 per cent, to 16,896 yesterday.

Among 278 stocks witnessing trade, 129 advanced, 90 fell and 59 remained unchanged.