The securities regulator has asked the merchant bankers to play a proactive role to ensure listing of more companies with good fundamentals to enhance depth of the country's capital market.
The regulatory instruction came from a seminar on the 'Role of Issue Managers for IPO Application' - held at the Bangladesh Securities and Exchange Commission (BSEC) office in the capital on Monday.
"There is no alternative to (bringing) the companies having good fundamentals to the capital market to strengthen its base," said BSEC Commissioner Shaikh Shamsuddin Ahmed while speaking as the chief guest of the programme.
Mr. Ahmed opined that the issue managers would have to play a pivotal role to ensure listing of more companies with good fundamentals.
"Apart from working with mandatory due diligence, the issue managers must also work as proactive stakeholders of the capital market to restore the investors' confidence," he added.
In the seminar, some issue managers suggested framing necessary rules for mandatory listing of the good companies, reluctant to go public.
The president of Bangladesh Merchant Bankers Association (BMBA) Md. Sayadur Rahman told the seminar that shares of the newly listed companies must be traded at fair prices.
"The securities regulator will have to frame a policy to ensure the trading of shares of the newly listed companies at fair prices."
He also said the volume of tradable shares should be increased on the debut trading.
The issue managers also said the existing 7.50 per cent gap between respective corporate tax rates for the listed and the non-listed companies is not enough to attract large companies to the capital market.
Apart from increasing the corporate tax gap, new policy should be framed for mandatory listing of large companies having good fundamentals, they opined.
The issue managers noted that the merchant bankers worked with due diligence on valuation of the shares of a company that went public at the face value (of Tk 10).
"The responsibility also lies with the investors. They cannot blame the issue managers after purchasing the shares of Tk 10 at Tk 40," an issue manager mentioned.
BMBA general secretary Riyad Matin, among others, also spoke on the occasion.