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Telecom shares has suddenly topped transactions at the Dhaka Stock Exchange (DSE) following remarks by the Bangladesh Bank governor advocating for reduced taxes on investments in the sector.
On Monday, the telecom stocks led with a total transaction value of Tk 465.6 million, accounting for 12.6 per cent of the day’s total transactions.
Despite the rise in telecom stock transactions, the DSE’s benchmark index, DSEX, saw a slight decline, dropping to 5,151 points, while the total market turnover amounted to nearly Tk 3.98 billion.
The index stood at 5,156 points on the previous trading day, and total transactions were Tk 3.71 billion according to bdnews24.com.
The rise in transactions came a day after Governor Ahsan H Mansur voiced support for reducing taxes on telecom investments during a seminar organised by the Metropolitan Chamber of Commerce and Industry (MCCI) in Dhaka.
"We need to increase investment in the telecom sector to ensure uninterrupted internet and reduce call drops. This cannot be achieved through policy alone; investment is essential," he said.
Following his remarks, shares of Bangladesh Submarine Cables increased by Tk 2.40, while Grameenphone shares rose by Tk 4.10.
Traditionally, the pharmaceuticals and chemicals, financial services, and textiles sectors have dominated DSE transactions.
The telecom sector generally holds a modest 4.0 per cent to 5.0 per cent share, with transaction values ranging between Tk 3.0 million and Tk 4.0 million.
In contrast, last week, the telecom sector's transactions totalled Tk 3.3 million, slightly down from Tk 4.0 million the previous week.
However, on Monday, the sector surged to the top.
Telecom stocks, which generally have a stable return, have attracted institutional investors due to their lower risk profile, said Humayun Kabir, chief executive officer of EBL Securities.
“Telecom stocks are market movers and institutional investors always show interest in this sector. The rise in transactions has also influenced the DSE index, which started strong in the morning. However, the index slightly declined towards the end due to less trading in other shares," Kabir told bdnews24.com.
Reviewing transaction data, Grameenphone shares gained Tk 24.80, a 7.9 per cent increase over the past month.
Meanwhile, Robi, the newest entrant in the telecom sector, saw its share price rise by Tk 2.60, an increase of 9.85 per cent.
The banking sector followed the telecom sector in Monday's transactions with Tk 412.3 million, while the pharmaceuticals and chemicals sector was third with Tk 406 million.
On a day when most shares lost value, block market transactions involved 25 companies, totalling about Tk 306 million. Munno Fabrics led this segment with transactions worth Tk 183.8 million.
According to DSE, out of 400 companies traded on Monday, the share prices of 91 companies rose, 247 fell, and 62 remained unchanged.
Munno Fabrics saw the highest increase, with its share price nearing the 10 per cent circuit breaker limit, closing at Tk 17.70.
Following this, shares of CVO Petrochemical Refinery and Khan Brothers PP Woven Bag Industries also rose.
Conversely, Padma Life Insurance, Generation Next, and Ratanpur Steel Mills Limited experienced the steepest declines.