In response to the Dhaka Stock Exchange's (DSE's) inquiry about the sharp increase in Fu-Wang Foods' share price in recent days, the company yesterday said there was no undisclosed price sensitive information behind the price hike.According to the DSE data, Fu-Wang Foods' stock price jumped by 61% in 15 trading days, from Tk25.9 on 14 August to Tk41.6 each on 4 September.Market insiders said Fu-Wang's share price started soaring after Minori Bangladesh – a subsidiary of the Japanese farming company Minori Co Ltd – started operating the company following an acquisition of the shares held by its sponsor-directors.Minori Bangladesh has also gained the ownership of Emerald Oil Industries, which resumed operation in January 2022 after remaining closed for around five years. The share price of Emerald Oil jumped from Tk30.8 on 2 April to Tk168.6 each on 4 September this year.Sources at Fu-Wang Foods said their share price might have increased due to a speculation that it might jump like Emerald Oil's share price did in recent months.Besides, sponsor-directors of Fu-Wang Foods have been buying the company's shares from the market to comply with the 30% shareholding rule, said market insiders.However, Fu-Wang Foods Company Secretary Md Sharif Al Mahmood told TBS, "None of the current board members have any involvement in the increase in transactions of the company shares and its price hike. We also do not know why our share transactions and price have increased."An analysis of the last two months' transaction data shows that a large number of Fu-Wang Foods shares are being traded in the block market every day along with the transactions in the main market.The company has been one of the most traded stocks at the DSE for the last two months.It topped the turnover chart on Sunday and Monday. The company's shares worth Tk65 crore were traded yesterday.Currently, 92.15% of the company's total shares are owned by public shareholders, and 7.85% by the sponsor-directors.Institutional investors accounted for 6.04% of the public shareholders in June 2022, which increased to 10.92% in June this year. The institutional investors' holdings fell to 6.05% in one month, but there was no change in the holdings of the sponsor-directors.Fu-Wang Foods Company Secretary Md Sharif Al Mahmood told TBS, "The securities regulator has given one year time to increase sponsor-directors' share-holding. We are working accordingly."Fu-Wang Foods could not pay any dividend in FY22 as it suffered Tk25 crore loss.In the first nine months of FY23, the company posted Tk1.89 crore profit.The company's revenue during that period was Tk87.93 crore, which was Tk93.52 crore during the same period of the previous fiscal year.
Source: The Business Standard
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