Shinepukur Ceramics is witnessing an unprecedented price hike and increase in turnover in the recent weeks despite no undisclosed price sensitive information (PSI).
The ceramic maker's share turnover increased over 47 per cent within three weeks while the company's share price almost doubled in the last three months riding on speculation.
The company's share closed at Tk 51.80 on Monday, rising 3.60 per cent further on the Dhaka Stock Exchange. Three months back, its share price was Tk 26.60, according to available data with the DSE.
Shinepukur Ceramics was also the second most-traded stock on Monday on the prime bourse with more than 5.56 million shares worth over Tk 284 million changing hands.
The recent price surge prompted the prime bourse to serve show-cause notice on the company to know whether there was any price sensitive information for recent unusual price hike.
The company, however, in response, said on Monday that there is no undisclosed price sensitive information of the recent unusual price hike and increase in volume of shares.
Even after being served show-cause notice, the company's share price has not stopped rising and jumped 3.60 per cent further on Monday, which may hit innocent investors.
The news of a jump in Shinepukur Ceramics' earnings per share (EPS) in the third quarter (Q3) of the current fiscal year led to buoyancy in the market, said a stockbroker.
The company's EPS soared more than 325 per cent year-on-year to Tk 0.17 for the January-March 2022 quarter compared to the same period of the previous year.
The company's nine months EPS that ended on March 31, 2022 also rose to Tk 0.27, up from Tk 0.14 for the same period a year earlier.
The ceramic maker disbursed only 2.50 per cent cash dividend for the year ended on June 30, 2021. In 2020, the 'B' category company provided a 2.0 per cent cash dividend.
Market insiders said price manipulation might be behind the 'abnormal' price hike of the company's share as transaction and price movement does not match its fundamentals.
The investors are chasing its stock without conducting a proper analysis when they see the rise in values, said a merchant banker.
"If the stock faces correction, general investors will be the losers, which will dent their confidence," he said.
Some companies with low performance records also made their way into the top gainers' list of the DSE frequently, riding on a rumour that the investors are putting money in the securities.
"The influential investors by disseminating rumours are trying to manipulate the prices of shares of many low-profile companies to make quick-profit," he said.
The investors should be careful about buying overvalued stocks in order to avert any misfortune, he said.
Senior executives of the company could not be reached over the telephone.
The company's authorised capital is Tk 5.0 billion and paid-up capital is Tk 1.46 billion while total number of securities is 146.96 million.
Sponsor-directors own 50 per cent stake in the company while institutional investors 6.0 per cent and the general public 44 per cent as on May 31, 2022, the DSE data showed.
Shinepukur Ceramics is a member of Beximco Group.