Dhaka, Aug 24 (bdnews24.com)—Dhaka stocks continued to drift Monday as investors were preparing for much anticipated IPOs expected in coming weeks.
Observers said a move by some merchant banks to halt margin loans against specific issues, as they had exceeded their loan exposure limits, had also negatively impacted the market.
Market insiders said many small scale investors are selling scrips to provide funds for an influx of IPOs expected in the upcoming month, including the huge Grameenphone issue.
"Subscriptions of at least six more IPOs, along with a couple of mutual funds are also expected to open within the next two months," Salahuddin Ahmed Khan, a former CEO of Dhaka Stock Exchange, told bdnews24.com.
"Retail investors, with limited investment, have started selling-off to subscribe to those IPOs," said Salahuddin.
"However, large scale investors should cover it, which is reflected in Monday's trade," said Salahuddin.
DSE's benchmark index DGEN shed 5.41 points, or 0.18 percent, to close at 2991.16 after losing about 31 points the previous day.
Meanwhile, turnover of the premier bourse slumped to Tk 4.92 billion, from Sunday's Tk 6.85 billion.
The all-share index or DSI lost 3.78 points, or 0.15 percent, to close at 2513.92.
The DSE-20 blue chip index slipped 2.98 points, or 0.13 percent, to finish at 2143.97.
On Thursday, the Securities and Exchange Commission (SEC) finally cleared Grameenphone to raise almost Tk 500 crore from its IPO, the largest single offering in the country's history.
Meanwhile, preliminary approvals for two mutual funds have also been made, an SEC official said.
"Thursday's SEC board meeting approved trust deeds of six mutual funds," Anwarul Kabir Bhuiyan, an executive director of the market regulator, told bdnews24.com.
Trust deeds of three mutual funds sponsored by IFIC Bank, Trust Bank and Prime Bank were cleared by the SEC, along with three from Delta Brac Housing, Phoenix Finance and ICB 3rd NRB Mutual Fund.
"We hope subscription of these mutual funds will open by the end of October," said Bhuiyan.
Downturn of the indices on Dhaka stocks slowed from the previous day, thanks to a substantial gain in mutual funds.
Almost all banks, non-banking financial institutions and insurers continued to decline.
All Beximco group shares ended on a positive note.
Summit Alliance Port Ltd topped the turnover board, with shares of Tk 209.543 million traded. It edged down 0.53 percent, finishing at Tk 2220.75.
Aftab Automobiles followed with a turnover of Tk 204.081 million. Profit taking caused the issue to slip 0.85 percent to Tk 1683 after shooting up for the last two days on reports of its concern Navana CNG's upcoming direct listing.
Market rookie, EBL 1st Mutual Fund had Tk 196.943 million traded. The scrip, which debuted on Wednesday surged 7.02 percent to Tk 32.
Beximco Ltd, edged up 0.79 percent to close at Tk 290.10, and saw shares of Tk 194.390 million changing hands.
Bex Tex's turnover reached Tk 184.849 million, closing at Tk 65.10, up by 2.84 percent.
Among other scrips on the turnover board—Jamuna Oil, Titas Gas, AB Bank, Heidelberg Cement and Summit Power all lost on selling pressure.
Meanwhile, brokerage house officials said some of their clients, mostly large scale investors, were unable to get margin loans on issues like Beximco, Bex Tex and Summit Power.
"Some merchant banks are reluctant to disburse loans against some specific scripts because of crossing loan exposure limit," a top official of a merchant bank told bdnews24.com.
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