Bangladesh
2 months ago

GP will have no floor from Sunday

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The floor price of the country's largest stock Grameenphone will be removed on Sunday, according to a stock exchange filing.

The market value of Grameenphone or GP is currently Tk 387 billion, more than 5 per cent of the total market capitalisation. GP has been stuck on the floor at Tk 286.6 per share since September 2022.

That means Tk 286.6 per share is not the equilibrium price, said Mohammad A Hafiz, former president of the Merchant Bankers Association, adding that the stock is likely to fall on the bourses after the floor price removal but investors need not panic.

With time, experts say, the stock may gain overcoming the investor inertia, as the company has performed well consistently since listing.

GP's price-to-earnings ration is 12, according to the DSE, which is far less than its peer Robi's 49.

The P/E ratio means how much investors have paid for every Tk 1 income of the company.

On July 28, 2022, the stock market regulator put restrictions on all stocks from going below the lowest price set to avert free fall of the market amid economic uncertainties.

The decision was derided by most analysts and foreign investors.

The Bangladesh Securities and Exchange Commission (BSEC) withdrew the floor price for most securities in January this year.

Though the price restriction will no longer be in place for GP from Sunday, upper limit and lower limit of the circuit breaker will be applicable.

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