BSEC considers banning overvalued bidders

Bangladesh Securities and Exchange Commission (BSEC) is considering punishment for bidders who overbid in book building auction to fix the cut-off price.

The offenders may be banned or punished in other ways, commission sources said.

It is learned that like the previous commission, the present commission is also worried about overvalued bidders in book building. These bidders act as barriers to the entire stock market in their own interests. Therefore, in the interest of the stock market, BSEC thinks they should be brought under punishment.

BSEC Commissioner Professor Sheikh Shamsuddin Ahmed said, “Some bidders in the auction have become poisonous for the stock market. They offer higher prices in collaboration with the company. It is now a topic of discussion in all quarters. This will no longer be allowed.”

“If anyone offers an overvalued bid in the future, he/she will have to face punishment. This commission is reluctant to make concessions on good governance,” he said.

The commission is considering a three-year ban on overvalued bidders. But it is also exploring other punishment options to discipline, he added.

In the meantime, unscrupulous investors have caused a lot of damage to the stock market by offering exorbitant prices. Of all the companies listed on the stock exchange since the launch of Book Building in 2016 are below the cut-off price except 'Amra Network' and Walton.

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