Zeal Bangla Sugar Mills' trade suspended on suspicion of price manipulation

The Dhaka Stock Exchange (DSE) on Tuesday suspended trading of Zeal Bangla Sugar Mills after detecting an abnormal stock price surge even as the company remains burdened with massive accumulated losses. 

Zeal Bangla's trading suspension is the latest regulatory intervention as the prime bourse strengthens market surveillance under the newly formed securities commission to protect investors and maintain market integrity.

The state-owned sugar mill's stock climbed 48 per cent in the past two weeks. The stock further jumped 8.5 per cent as soon as the market opened on Tuesday, reaching Tk 180.7 per share, triggering a trade suspension.

Zeal Bangla Sugar has repeatedly experienced price rallies despite weak financial performance and limited business prospects. The company has remained a speculative stock for years, attracting retail investors during short-lived rallies.

The suspension is a precautionary measure aimed at protecting investors and ensuring market integrity, said a DSE official, requesting anonymity as the review is still underway.

"The exchange would analyse trading data, identify the investors involved in the transactions and determine whether there was any violation of securities regulations before deciding the next course of action," he said.

The DSE has strengthened its real-time surveillance system in recent weeks as part of broader regulatory efforts to curb abnormal trading, detect potential manipulation and improve investor confidence.

The trading suspension has drawn attention to the company's fragile financial picture, as reflected in its latest audited financial statements. According to the audit report for FY25, Zeal Bangla has accumulated losses of Tk 7.03 billion, while its total liabilities exceeded total assets by Tk 6.83 billion, indicating severe capital deficiency and financial distress.

The report shows that the company has outstanding bank and government loans amounting to nearly Tk 4.68 billion, including agricultural loans, long-term secured loans and short-term borrowings. No principal or interest payments have been made on these loans for a prolonged period.

The auditors also expressed significant doubt about the company's ability to continue as a going concern without financial support from the government. There has been no recent corporate disclosure, earnings improvement or operational development that could reasonably explain the latest jump in the share price.

Recently, the stock exchange also suspended trading of Sonargaon Textiles and Shyampur Sugar Mills for their abnormal price surge. However, after a single-day suspension, their trading resumed on the bourses.

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