Sea Pearl stocks soar despite bleaker profit

The share price of Sea Pearl Beach Resort and Spa Limited has soared by as much as 140 per cent in less than a month despite the listed company posting a dismal financial disclosure in the latest quarter.

After a single-day break, the stock price of the owner company of Cox’s Bazar’s luxury hotel Royal Tulip reached Tk 131.90 per share Wednesday on the Dhaka Stock Exchange (DSE), which was only Tk 57.1 on September 9.

But the tourism service company posted a nearly 41 per cent decline in net profit in the third quarter of the fiscal year 2021-22, contrasting with the gains in its stock price.

In the Q3 of FY22, the company posted a net profit of Tk 4.27 crore versus the figure of Tk 7.21 crore in the same period of the previous year.

The company’s earnings per share (EPS) also declined in the same period with an EPS of Tk 0.35 for the Q3 of FY22, compared to Tk 0.60 in the corresponding period of FY21.

The company did not even announce any new business deal or business development plan that could stimulate its share price.

When contacted, Azaharul Mamun, company secretary of Sea Pearl Beach Resort and Spa Limited, told The Business Post, “Our business has been the same as it was before. We do not know why the stock price is rocketing.”

On September 7, the company’s stock price started jumping abnormally.

Following that, the DSE authorities served the company a show-cause notice asking it about the reasons behind that rise in its stock price.

In reply, the company stated that it had not taken any fresh initiatives that could fuel its stock price. Apart from the hotel business, the company is also involved in cruise service, food and beverage, and water park businesses.

The company’s revenue from renting hotel rooms for the Q3 of FY22 stood at Tk 7.53 crore against Tk 10.13 crore in the same period last year.

The company secretary said, “In FY20, our hotel income nearly halted due to the pandemic. In the following year, everything came back to normalcy, but in the very early of FY22, the pandemic again appeared with vigour, hampering business.”

The company’s revenue from food and beverage also declined in FY22.

The sponsors and directors held a 46.83 per cent stake in the company, while institutions and the general public held 27.2 per cent and 25.81 per cent respectively till August 2022.