A recent unusual price hike of the Beacon Pharmaceuticals stock prompted the company to inform investors on July 28 that it had no undisclosed information that could have instigated the rise.

Despite the message, its stock price rose more than 7 per cent to Tk 198 from Tk 184 that day. The next day it advanced to Tk 203.

In the same way, last Monday it rose 7 per cent to Tk 217. It continued to climb, the latest by 6 per cent yesterday to Tk 230.

Such jumps raised eyebrows of stock market analysts as they believe it was not normal and that behind the scenes there were some people engaged in foul play.

So the regulator should investigate whether there is any malpractice or manipulation.

The company's profits rose in the last two years, so investors purchased its shares. But the price is now overvalued, said a top official of an asset management company.

The drug maker's stocks have risen some 900 per cent in total up until yesterday, considering the fact that it was Tk 23 two years back on August 4 of 2019.

Its profits rose 489 per cent year-on-year to Tk 75 crore in the July 2020 to March 2021 period.

Thanks to the higher sale of medicine during the pandemic, its profit rose in the period. But its stock price rose higher than that of the profit surge, which may create risks for investors, said the asset manager.

Earnings per share (EPS) of peer companies also indicate that the Beacon's price is overvalued, he added.

Bangladesh's leading drug maker Square Pharmaceuticals' EPS was Tk 13.20 in the July 2020 to March 2021 period while the Beacon logged an EPS of Tk 3.27, shows data of Dhaka Stock Exchange (DSE).

Square Pharmaceuticals' stock price stood at Tk 222.90 yesterday whereas it is Tk 230 for the Beacon.

Square Pharmaceuticals is the market leader, be it considering product quality or market share, and it has a long continuous growth history, said Khairul Bashar Abu Taher Mohammed, CEO of MTB Capital.

But its share price was beaten by that of the Beacon, he said.

Fundamentally the Beacon has no reason to exceedSquare Pharmaceuticals' price, he said.

So, the sudden price rise of the oncologyproduct manufacturermay be for manipulation, he said, adding, "Its fast rise is alarming too."

The stock price of Beacon Pharmaceuticals rose 84 per cent in a span of one month, shows the DSE data.

Investors should be cautious about investing here, added the merchant banker.

"This company's surge is already in our radar," said Mohammad Rezaul Karim, spokesperson of the market regulator, Bangladesh Securities and Exchange Commission.

"Due to the pandemic, our investigation, and hearing process has slowed but its recent price surge is quite suspicious," he said.

"We will see whether there is any wrongdoing behind the price jump," Karim added.