Jute Spinners, a jute industry company listed in the stock market, has been closed for nearly half a century. During this long period, there was no dividend for investors, no financial report. The head office became noisy if one job was left due to the salary and allowance crisis. At present there are 10-12 officers and employees but the entire office is almost silent. The only exception is the company`s share price. It is advancing forward like a mad bull.
Office officials say that the information about the production may have been leaked somehow.
However, analysts say, all the shouting is futile. Because in essence, this is being done for market manipulation. Because given the amount of liabilities against the assets of the company, it is impossible to settle claims and include profit as revenue even in the next decade. According to the data of DSE, the share price increased from Tk 94.50 in the last 52 weeks till last Thursday, and the company was standing at the highest in its history Tk 228. During this period, the share price increased by Tk 133.50 or 141.27 percent. That is, it increases almost two and a half times. But when asked the reason from DSE, the organization said that they do not have any information on price sensitivity. As a result, what is actually happening with the shares of Jute Spinners, which is on the path of bankruptcy, the concerned conscious circles are expressing apprehension.
Some investors of the company said that after 2016 there was no AGM of Jute Spinners. As the production stopped for more than six years, the salaries of the workers and officials were in arrears.
Meanwhile, the amount of deficit in savings and surplus fund is about 26 crore 77 lakh taka. Earnings per share also turned negative, with a deficit of Tk 32.50 per share. Still the share price is increasing.
According to the information received from DSE, Jute Spinners Limited was among the top gainers of DSE for the last two weeks. The authorized capital of the company is only three and a half crores of taka, the paid up capital is one crore and 70 lakh taka. Among them, the directors` capital is 67 lakh 69 thousand 400 taka and the number of shares is 6 lakh 76 thousand 940. General and institutional investors have one crore two lakh 30 thousand 600 taka or 10 lakh 23 thousand 60 shares. With so little capital, investors believe that a gang is manipulating the company`s shares.
However, the reason for the increase in price is not known, although the company said so earlier, the company said last Thursday that jute spinners are coming back into production. The machinery of the factory will be operational again this month.
The chief financial officer of the company Tofazzal Hossain said that the commercial production will start this month as a private initiative of the owner. Various related parties including lender banks have already visited the Khulna factory. However, he thinks that this information about coming into production may have been revealed in some way, due to which the share price is increasing.
He told this reporter that the situation before the production starts, it seems that the share price will stop at Tk 250 when the production starts. According to investors, it is doubtful whether the company will turn a profit even in the next decade in terms of liabilities and losses. Still, the company`s officers and employees may be behind the increase in the share price of such companies. Many may have bought shares in the name of parents, wife and children. Although they will benefit by increasing the price by publishing information in advance, the investors will be harmed overall. Janata Bank Limited is giving loans to the institution.
According to DSE data, the total loan amount of jute spinners so far is Tk 40 crore 68 lakh. Out of this, the short-term loan is Tk 31 crore 77 lakh and the long-term loan is Tk 8 crore 91 lakh. Apart from these, the company has a business loss of about 80 crore taka.
According to a source of Jute Spinners, the Janata Bank authorities visited the factory in Khulna before the company resumed production. After that the bank started buying a significant number of shares of the company. Apart from this, some senior officials of the company are also known to be buying shares in the names of various family members.
However, market analysts say that the release of this news about the coming of production is also a ploy by the company. They say the company told DSE they do not have price sensitive information. But they are again saying that they are coming into production. So which one is correct? According to many, by spreading such news, someone related to the company may want to increase the share price.
When asked to know the reason for such high prices of shares of weak fundamental institutions, Executive Director and Spokesperson of BSEC Mohammad Rezaul Karim said, there will be speculation in the market. Be it the US market or Bangladesh. If someone wants to buy shares, I can`t stop them. However, it has to be seen whether the market is being manipulated or not. We are investigating these matters. Action is being taken if irregularities are found.