The shares of 17 companies, most of which came to the market during the 2010-15 period with premiums, are now trading below their respective offer prices.
According to information of Dhaka Stock Exchange (DSE), the companies witnessed 2.07 per cent to 43.80 times over subscription compared to their volume of shares offered for public.
Former DSE president Md. Shakil Rizvi said share prices of even the good companies may decline due to different reasons, including falling market trend.
"Share prices may also decline, if the number of shares of a company increases because of issuance of bonus shares. Bonus shares should be issued considering a company's growth and proper expansion plan."
Mr. Rizvi further said many multinational companies refrain from issuing stock dividend year after year.
The companies, whose market prices are below their respective offer prices as of Sunday, are - MJL Bangladesh, Baraka Power (former Barkatullah Electro Dynamics), MI Cement Factory, Rangpur Dairy and Food Products, Zahintex Industries, GBB Power, Saiham Cotton Mills, Argon Denims, Orion Pharma, Familytex (BD), Appollo Ispat Complex, Peninsula Chittagong, Khulna Printing & Packaging, Shurwid Industries, and Hamid Fabrics.
MJL Bangladesh floated shares at an offer price of Tk 115, and the company's share trading closed at Tk 113.40 on Sunday.
Baraka Power floated shares at an offer price of Tk 60 whose trading closed at Tk 42.40, MI Cement floated at an offer price of Tk 111.60 and its trading closed at Tk 110.70, Rangpur Dairy and Food Products floated shares at Tk 18 and closed at Tk 16.30, Zahintex Industries floated shares at Tk 25 and trading closed at Tk 23.60, GBB Power offered at Tk 40 and closed at Tk 23.30, Saiham Cotton Mills at Tk 20 and closed at Tk 18.80, and Unique Hotel & Resorts offered at Tk 75 whose trading closed at Tk 54.50.
Among other companies, Argon Denims floated shares at Tk 35 and trading closed at Tk 32.90, Orion Pharma floated shares at Tk 60 and closed at Tk 49.30, Familytex (BD) floated shares at Tk 10 and closed at Tk 9.30, Appollo Ispat Complex floated shares at Tk 22 and closed at Tk 20.90, Peninsula Chittagong floated shares at Tk 30 and trading closed at Tk 29.70, Khulna Printing & Packaging floated shares at Tk 10 and trading closed at Tk 7.90, and Shurwid Industries floated shares at Tk 10 and trading closed at Tk 9.90.
Other than 60 per cent cash dividend recommended for 2016, MJL Bangladesh issued stock dividend ranging from 10 per cent to 15 per cent during 2010-16 period.
Rangpur Dairy and Food Products issued only stock dividend ranging from 10 per cent to 12 per cent during 2011-16.
Zahintex Industries issued only 5.0 per cent and 7.0 per cent cash dividend in 2015 and 2016 respectively. Besides, the company continued recommendation of stock dividend ranging from 8.0 per cent to 15 per cent during 2012 to 2016.
Unique Hotel & Resorts recommended no dividend during 2012-2015. The company recommended 22 per cent cash dividend for 2016.
Argon Denims recommended 10 per cent cash dividend only for 2016. Apart from this, the company issued 15 per cent to 20 per cent stock dividend during 2012 to 2016.
After listing, Familytex (BD) issued 100 per cent stock dividend in 2013, 10 per cent stock dividend in 2014, no dividend in 2015 and 5.0 per cent stock dividend in 2016. The company has already been shifted to 'B' category because of recommending dividend below 10 per cent.
Shares of two companies went down below their face value of Tk 10 each and their category has been degraded for recommending dividend.
Shurwid Industries recommended 15 per cent stock dividend only in 2014. The company has already been shifted to 'Z' category for not recommending dividend in 2015 and 2016.
Khulna Printing & Packaging has been shifted to 'Z' category for not recommending any dividend for 2016.