BSEC to probe Gemini Sea Food’s ‘unusual’ share price hike

The Bangladesh Securities and Exchange Commission (BSEC) on Tuesday formed a two-member body to probe into the unusual movement of Gemini Sea Food Limited’s share price and volume observed recently.

The stock market regulator formed the committee comprising Mohammad Rakibur Rahman, additional director, and Foysal Islam, assistant director of the BSEC.

The committee has been asked to complete the inquiry and submit a report to the commission within 20 working days, according to a BSEC letter issued to the managing director of the company and the managing directors of Dhaka Stock Exchange (DSE) and Chittagong Stock Exchange (CSE).

“The commission is of the opinion that it is necessary, in the public interest, to conduct an inquiry into the company’s share price, to review recent unedited and audited financial statements, to identify market manipulation attempts, and to identify insider trading,” said a BSEC order.

The stock price of the ‘B’ category Gemini Sea Food jumped over 56 per cent in the last three months riding on speculation and irrational hype among investors.

The frozen food exporter was also the day’s top gainer on Tuesday, gaining Tk 39.7 or 8.67 per cent to Tk 497.50 each on the Dhaka bourse.

Its shares traded between Tk 166.70 and Tk 638.90 in the last one year.

Following the ‘abnormal’ price hike, the DSE served a show-cause notice on the company.

The company, however in a knee-jerk response, informed the DSE that there is no undisclosed price-sensitive information for the price hike.

Even after being served show-cause notice, the company’s share price did not stop rising.

Market insiders said that investors are rushing towards its stock without conducting a proper analysis seeing the rise in values.

The company, listed with the stock exchange in 1985, declared a 10 per cent cash (excluding directors and sponsors) and a 30 per cent stock dividend for the year ended June 30, 2022.

The company has reported earnings per share (EPS) of Tk 12.49, net asset value per share of Tk 13.10 and net operating cash flow per share of negative Tk 25.79 for the year ended June 30, 2022 as against Tk 0.72, Tk 0.93 and Tk 1.05 respectively for the same period of the previous year.