The Financial Express

Call to remove barriers to listings

Joint step needed to draw more MNCs into stock market

| Updated: August 06, 2020 21:13:07

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Market intermediaries said the obstacles that hinder the listing of good local and multinational companies (MNCs) should be removed to enhance the depth of the country's capital market.

They laid importance on a joint initiative for attracting companies with good fundamentals.

The views came at a virtual discussion on 'Demand of quality IPOs (initial public offerings) and role of the issue managers,'organised by the product and market development department of Dhaka Stock Exchange (DSE), where merchant bankers were present.

DSE's managing director Kazi Sanaul Hoq said the main bourse's market cap to GDP ratio is much lower than that of other countries.

"The listing of local companies having good fundamentals and the MNCs will have to be ensured to raise the market to GDP ratio," Mr Hoq said.

He said the role of merchant bankers is crucial to enhancing the depth of the capital with the listings of good local firms and the MNCs.

"Investors' confidence in the capital market will also increase following the listing of good companies," said the DSE boss.

He said the premier bourse is working on easing the online trading along with making it popular to all investors of the capital market.

"We are also trying to launch the alternative trading board and SME board. The turnover of the premier bourse will increase manifold following the operations of the two boards," he said.

The president of Bangladesh Merchant Bankers Association (BMBA) Sayadur Rahman said all market intermediaries should work together to remove the obstacles, which prevent MNCs from getting listed on exchanges.

"There should be a database of quality audit reports. A standard for receiving bank loans should also be fixed against the paid-up capital to make the companies market-oriented," said the BMBA president.

He also underlined the need for a joint effort to ensure the listings of good local and the MNCs. "The banking sector and the capital market will be benefit from this."

The DSE's chief operating officer M. Shaifur Rahman Mazumdar said without looking at the policy support, all market intermediaries should work together to help diversify the capital market.

"The merchant bankers must ensure their due role to make ATB and SME board vibrant," Mr. Mazumdar said.

In his keynote speech, the chief of the DSE's product and market development department Syed Al Amin Rahman focused on the impediments to the listings of local and foreign firms having strong fundamentals.


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