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Sea Pearl Beach Resort & Spa Ltd. made a flying trading debut on both the bourses on Tuesday as its share price jumped as high as 261 per cent riding on the investors' 'irrational hype' over the new issue.
The 'Travel & Leisure' sector company's share was traded between Tk 25.10 and Tk 38.70, before closing at 36.40 each on the Dhaka Stock Exchange (DSE). Its issue price was Tk 10.
The company also topped the turnover chart on the prime bourse, with 5.01 million shares worth Tk 154 million changing hands.
On the Chittagong Stock Exchange (CSE), the company's share price soared 257 per cent to close at Tk 35.70 each.
The debutant was also the most traded stock on the port city's bourse with about 1.71 million shares of Tk 54.07 million changing hands on the day.
Market analysts said the investors showed great appetite for the newly listed stock amid short-term speculation.
The Sea Pearl Beach, the owner of "Royal Tulip Sea Pearl Beach Resort & Spa in Cox's Bazar", is a luxury hotel in Bangladesh, which started commercial operation on September 17, 2015.
The company raised a fund worth Tk 150 million from the capital market by floating 15 million ordinary shares at a face value of Tk 10 each using the fixed-price method.
The company will use the IPO fund for interior, finishing, furniture & fixture (157 rooms), acquisition of land, and bearing the IPO expenses.
As per unaudited financial report, the company's profit after tax was Tk 61.06 million and basic EPS was Tk 0.61 for nine months (July 2018-March 2019) as against Tk 39.65 million (profit after tax) and Tk 0.67 (basic EPS) for the same period of the previous fiscal year.
However, the post-IPO EPS would be Tk 0.53 for nine months ending on 31 March 2019.
Banco Finance and Investment Ltd. and the Prime Bank Investment Ltd. jointly manage the IPO process.
The principal services of Sea Pearl Beach Resort and Spa are rooms and suites and food & beverage.
The company's paid-up capital is Tk 1.15 billion, authorised capital is Tk 2.0 billion and the total number of securities is 115 billion.
The sponsor-directors own 46.83 per cent stake in the company, while institutions 27.77 per cent, foreign investors 0.03 per cent and the general shareholders 25.37 per cent as of June 30, 2019, the DSE data show.