Tung Hai stock price surges over AGM news
However, it suddenly disclosed at the DSE website on 17 November this year that it received permission from the high court to hold the four years’ AGM within eight weeks from 9 November
Tung Hai Knitting and Dyeing share price moved up by 14% on the Dhaka Stock Exchange's (DSE) secondary trading platform in two days as the company has got approval from the high court to conduct an annual general meeting (AGM).
On the second day, Thursday, its share saw a 10% price hike as no one showed interest in selling the share. At the end of the Thursday trading session, its share price on the premier bourse closed at Tk6.60 each.
The company's factory has remained closed since the middle of the 2016-17 fiscal year. It also failed to hold an AGM since then. The company also did not publish the quarterly unaudited financial report since March 2017.
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However, it suddenly disclosed at the DSE website on 17 November this year that it received permission from the high court to hold the four years' AGM within eight weeks from 9 November.
The Business Standard could not reach the company's Chairman Anjuman-Ara-Khanam and Managing Director Nafreen Mahbub for the comments as their mobile numbers were switched off.
But a former business partner of the company and friends of Md Mahbubur Rahman, former chairman of Tung Hai Knitting, told TBS on condition of anonymity that the death of Mahbubur Rahman in2013 created a leadership crisis at the company. After Mahbubur's death, his wife and daughter took over the business, they said, adding as the family members were not active, the factory remained closed for the past four years and that is why it could not hold AGM.
Mahbubur Rahman started Tung Hai Knitting in 2004. He died in a fire incident that occurred at his company's head office in the capital's Mirpur.
Mahbubur completed all regulatory work for listing his company on the capital market. It got listed in 2014 and raised Tk35 crore by issuing 3.5 crore shares.
Following the failure of the company due to mismanagement, the Bangladesh Securities and Exchange Commission (BSEC) has frozen the bank accounts of the company and its directors to protect the interest of general investors.
The securities regulator also found that the company's directors violated securities rules.
BSEC sources said several months ago the commission held a meeting with the chairman and directors of the company at which the directors were asked to give opinion about the reopening of the company. Based on their opinion, they have been given the opportunity to come up with specific proposals for the management of the company. In addition, the decision to freeze their bank accounts has been withdrawn.
Dr Shaikh Shamsuddin Ahmed, commissioner of the BSEC, told TBS that the death of the company's founder was tragic. "On the other hand, his wife and children are not eligible enough to run the business. Besides, the company has a lot of liabilities.
"However, the locations of the company's factory and offices are good. Therefore, we have advised them to consider selling the properties. This is because we have to uphold the interests of ordinary investors."
Tung Hai Knitting's paid-up capital is Tk106.65 crore. Out of total shares, sponsors and directors hold 30.04%, institutes 4.55%, and general investors have 65.41%.
