The Financial Express

Sonali Paper's price jumps 237pc in six months

| Updated: December 16, 2021 17:56:49

Sonali Paper's price jumps 237pc in six months

Sonali Paper & Board Mills is witnessing an unprecedented price hike and increase in volume of shares despite the overall market is facing a choppy trading.

Within the two weeks, the company's share price soared Tk 225 each or 41 per cent to close at Tk 769.50 on Wednesday while its share price jumped over 237 per cent or Tk 541 each in the past six months.

Its share price was Tk 228 each six months back on June 16, 2021. The company's share price did not stop rising despite the Dhaka bourse served a show-cause notice on the company.

Sonali Paper came back to the main board of the stock exchanges from the over-the-counter market (OTC) on July 26, 2020.

In May this year, the company disclosed that they are going to install a new plant to produce aluminum foil paper boxes.

In September this year, the company also decided to issue one rights share against two existing shares at par after considering a 20 per cent stock dividend for the year ended on June 30, 2021, subject to regulatory approval.

The company's share price is rising based on its higher profit growth and rights shares issue news, according to a stockbroker.

However, he said the investors should be cautious about buying overvalued stocks in order to avert any misfortune.

Share prices of many companies are on the rise, although transaction and price movement of these companies' shares do not match with their fundamentals, said an analyst at a leading brokerage firm.

He noted that some influential investors by disseminating rumours are trying to manipulate the prices of shares of many companies.

The investors need to be cautious and should not pay heed to any rumours related to companies and take their investment decisions prudently, he added.

Senior executives of the company could not be reached over the telephone

Sonali Paper & Board Mills - a concern of Younus Group of Industries - has reported 957 per cent growth in profit in the first quarter for July-September, 2021 compared to the same quarter last year.

The company's earnings per share (EPS) stood at Tk 6.66 for July-September, 2021 as against Tk 0.63 in the same quarter a year earlier.

The company has informed that during the period, its sales and other income increased, and financial costs decreased. As a result, its net profit and EPS increased from that of the previous year.

The company also posted a 235 per cent year-on-year growth in EPS to Tk 4.89 for the year ended on June 30, 2021.

As profit rose significantly, the company declared 20 per cent cash and 20 per cent stock for the year ended June 30, 2021.

Meanwhile, one of the directors of the company sold 100,000 shares of the company at prevailing market price through stock exchange last month.

Sonali Paper & Board Mills was incorporated in 1977 and got listed on the Dhaka Stock Exchange in 1985 and on the Chittagong Stock Exchange in 1996.

Under the previous management, the company had incurred huge losses and failed to provide financial statements and holding annual general meetings for years from 1998 to 2006.

Younus Group took over the company after buying all shares in 2006.

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