Capital Market in Bangladesh

Background of the Market DSE, the first stock exchange of the land was incorporated on April 28, 1954, while the second stock exchange CSE was established in 1995 After independence of Bangladesh, trading activities started in August 1976. From 1998 automated screen based trading was introduced by both the exchanges through LAN and WAN connectivity and HP non stop trading platform is providing basic architecture.

Capital Market in Bangladesh

Corporate Structures of the Exchanges

The Stock Exchanges are registered as Public Limited Companies under companies Act. Presently DSE has 234 outstanding shares (members) while CSE has 140 shares outstanding. The exchanges are Self Regulatory Organizations and their activities are regulated by

Articles of Association Own set of Rules, Regulations and Bye-laws Securities and Exchange Ordinance 1969 Securities and Exchange Rules 1987 Other relevant laws.

Capital Market in Bangladesh Basic Markets

Public Market : For general trading

Spot Market : For pre-book closer trading Block Market : For bulk volume trading Odd lot Market : For odd lot trading

Trading Session
Trading at DSE is performed through a non-stop platform in following sessions : Continuous Trading hours : 10.00 AM to 2.00 PM Trading day : Sunday To Thursday.

Capital Market in Bangladesh

SETTLEMENT & CLEARANCE SYSTEM Primarily Settlement Period is T+1 and T+3 Days : All the trades are cleared and settled, as per Settlement of Stock Exchange Transactions Regulations 1998. From January 24, 2004 CDS system started functioning & transactions of all demated Securities are settled and registered through CDS A central clearing company is under process to ensure efficient financial settlement

Capital Market in Bangladesh Market Standard and Requirements

Disclosure Requirements by the Listed Companies Yearly Audited Financial Statement within four months of the year end. Half-yearly Un-audited financial statements within one month of the first half-year end. Price Sensitive disclosures It is mandatory to follow in preparation of the accounts International Accounting Standard (IAS) International Standards for Auditing (ISA) Corporate Governance All the listed companies are required to adopt the Corporate Governance Guidelines issued by SEC and required by Listing Regulation

Capital Market in Bangladesh

Featured by: Low Ratio of Market Capitalization to GDP
Country M.Cap (US $ bn) 5.96 730.00 46.69 8.38 GDP (US $ bn) 63.73 854.48 128.99 26.18 M.Cap to GDP ratio 9.35% 85.43% 36.20% 32.01% M. Cap to Transaction 0.17% 0.61% 0.82% 0.22%

Bangladesh ( DGEN) India (BSE) Pakistan (Karachi SE) Sri Lanka (CSE)

Source: IMF World Economic Outlook & Website of Stock Exchanges of Respective Countries.

Capital Market in Bangladesh

Basic Market Statistics
Total Issued Capital of all listed Securities US $ 2.24 bn Market Capitalization of all listed Securities US $ 5.96 bn
LISTED SECURITIES
As on April, 2007

=> Companies : 258 ( A 142 , B - 29, G-1, N-7, Z - 86) => Mutual Funds : 14 => Debentures : 08 => Govt.T. Bond : 42 All Securities are Distributed in 16 Sectors :
1. Banks 2. Investment 3. Engineering 4. Food & Allied Products 5. Fuel & Power 6. Jute 7. Textile 8. Pharmaceuticals & Chemicals 9. Paper & Printing 10. Services & Real Estate 11. Cement 12. IT 13. Tannary Industries 14. Ceramic Industry 15. Insurance 16.. Miscellaneous

Capital Market in Bangladesh

COMPANIES UNDER CDS
Particulars Securities under the CDBL Companies under the CDBL IPO (upcoming)
No. Market Cap Tk. in mn
% of total Market cap

153 111 3

343,315
---

83.21
---

268,654

80.39

Multinational & Joint Venture Companies Listed

Particulars
No.of company Market Cap. in mn % of total market cap.

Multinational Companies
Joint Venture Companies

12
6

80319.16
6101.46

19.86
2.25

Trn in mn

1010

1210

1410

1610

1810

210
2002 2003

410

DSE perform ance from May 2002 to April 2007

2004

610

810

10
2005 02/05/ 2002 03/06/ 2002 04/07/ 2002 04/08/ 2002 04/09/ 2002 03/10/ 2002 04/11/ 2002 09/12/ 2002 11/01/ 2003 09/02/ 2003 16/03/ 2003 16/04/ 2003 18/05/ 2003 16/06/ 2003 17/07/ 2003 17/08/ 2003 18/09/ 2003 21/10/ 2003 19/11/ 2003 28/12/ 2003 28/01/ 2004 09/03/ 2004 11/04/ 2004 18/05/ 2004 17/06/ 2004 20/07/ 2004 17/08/ 2004 26/09/ 2004 27/10/ 2004 04/12/ 2004 05/01/ 2005 17/02/ 2005 21/03/ 2005 23/04/ 2005 28/05/ 2005 26/06/ 2005 27/07/ 2005 28/08/ 2005 03/10/ 2005 16/11/ 2005 26/12/ 2005 05/02/ 2006 15/03/ 2006 25/04/ 2006 01/06/ 2006 11/07/ 2006 15/08/ 2006 25/09/ 2006 09/11/ 2006 18/12/ 2006 29/01/ 2007 07/03/ 2007 15/04/ 2007 2006

Capital Market in Bangladesh

5 YEARS MARKET PERFORMANCE (DSE only)

300

500

700

900

1100

Trn in mn

DGEN

1300

1500

1700

1900

2100

DGEN

Capital Market in Bangladesh

Sectoral Market Capitalization as of April 2007
Market Sector Financial Sector Banks Insurance Investm ent Total Manufacturing Foods Pharm aceuti cal s Texti l e Engi neeri ng Ceram cs i Tannery Paper & Pri nti ng Jute Cem ent Total Service & Miscellaneous Fuel & Power Servi ce & Real Estate IT Mi scel l aneous Total 38,725.99 1,488.75 2,028.78 11,027.82 53,271.34 11.59 0.45 0.61 3.30 15.95 6,765.85 28,545.39 9,997.11 8,661.55 609.07 2,959.84 286.89 140.81 30,395.84 88,362.35 2.02 8.54 2.99 2.59 0.18 0.89 0.09 0.04 9.09 26.43 177,636.36 9,572.79 5,363.74 192,572.89 53.15 2.86 1.60 57.61 Capitalisation Tk in mn(334,207) % of total Market Cap

Capital Market in Bangladesh

Sectoral Turnover during 2006
Banks Investment Insurance Total Engineering Foods Jute T extile Pharmaceuticals Paper & Printing Cement T annery Ceramics Total Fuel & Power Service & Real Estate IT Miscellaneous Total Volume(in mn) Value(Tk in mn) Financial Sector 76.27 31,123.12 253.69 813.86 9.84 2,525.52 339.79 34,462.50 Manufacturing 16.93 2,427.31 74.42 764.71 0.76 13.47 106.63 2,998.60 77.40 4,869.96 1.04 11.67 20.77 3,567.90 14.13 678.29 0.32 31.21 312.39 15,363.13 Miscellaneous & Service 41.02 11,173.77 6.75 235.63 76.84 2,015.78 55.89 1,810.80
180.49 15,235.98 Turnover %

47.83 1.25 3.88 52.97 3.73 1.18 0.02 4.61 7.48 0.02 5.48 1.04 0.05 23.61 17.17 0.36 3.10 2.78
23.42

Capital Market in Bangladesh

Weighted Average Sectoral P/E during April, 2007

Market PE

15.03

10.66

14.51

13.85

Capital Market in Bangladesh

Dividend of Listed Companies over the Years by Sector Sector Bank Cement Engineering Food & allied Insurance
Fuel & Power
Bank Cement Ceramics Engineering Food & allied Fuel & Power ' Insurance 'Investment IT Jute' Miscellaneous Pharmaceuticals Service & Real Estate Tannery Textile Paper and Printing Sector

Dec 2003
Dividend %a December 2003

Dec 2004
Average Dividend % December 2004 18.84 1.01 8.22 18.25 22.24 105.15

Dec 2005
Dividend Average % December 2006 5.05 1.56 8.83 12.44 8.82 2.92 5.70 12.84 6.15 2.89 23.49 25.49 3.19 7.54 6.38 2.16

Dec 2006
35.05 6.56 20.31 12.44 18.32 27.92

23.69 Average 6.21 25.94 1.21

7.94 19.38 19.38 24.21 24.21 3.69

18.84 Average 6.25 25.22 0.99 18.25 9.42

20.81 21.53 22.24 32.71 11.14

Dividend

% December 2005

34.98 5.99 25.31 20.81 21.53 32.71

54.44 18.16
10.26 18.16

54.44

105.15 6.68 13.6

12.84 13.6

' Insurance
'Investment IT Jute'

13.56 10.63 2.17 7.07 21.12 1.97 20.1 5.35 -

19.28
50.39 22.57 7.50

18.33
40.24 9.33 2.89

30.26 2.61
8.57 8.92

8.92

38.56 3.97
10.46 10.63

5.15

2.61 1.97

18.58

2.17 1:79

20.32

Miscellaneous
Pharmaceuticals Service & Real Estate

20.57 5.08
0.31 19.58

16:66

20.07 4.76
21.12 1.38 5.97

23.65

18.96
22.62 10:79

23.49
25.49 12.19

6.00

Tannery Textile

16:66 5.08

21.61 5.35

23.65 4.76

7.54 6.38

Capital Market in Bangladesh

Market Development Over the Years
2500

2000

Annual Turnover (Tk. In million)

Taka

1500

1000

M . cap (Tk. in billion)

500

General Index
0

30.06.03

30.06.04

30.06.05

30.06.06

01 .05.07

End of Year on June 30

Capital Market in Bangladesh

Statistics of IPO Subscription
Name of the Issue Sonar Bangla Insurance Islamic Finance & Investment Premier Leasing Int.Ltd. Progressive Life Insurance Bergers Paints Bangladesh Ltd. Pragati Life Insurance Jamuna Bank Ltd. S. Alam Cold Rolled Steel Ltd Lankabangla Finance BIFC IPDC BRAC Bank Ltd. Prime Islami Life Ins. Com. Shahjalal Islami Bank ICB AMCL 1st NRB MF Public Offer Taka in mn 90.00 100.00 100.50 45.00 11.60 45.00 386.1 108 90.00 110.95 139.00 500.00 45.00 935.85 100 Public Subs. Over Subscription Taka in mn in times 360.56 4.01 1,597.14 15.97 1,059.90 10.55 1,643.58 36.52 1,227.96 105.90 1,734.95 38.55 3896.51 10.09 442.07 4.09 1483.24 16.48 1569.64 14.15 2261.88 15.27 4171.54 7.34 1417.04 30.49 4025.65 4.3 944.56 9.45

Total

2,807.00 27,836.20 US$41mn US$403mn

9.96

Capital Market in Bangladesh

DIRECT LISTING Provisions

Issuer

Paid up Capital
Tk.in mn

Total Offloading
Tk.in mn 317 910

For General Public/Ins

Tk.in mn 286 865

Dhaka electric Supply Co. Ltd. (DESCO)

1,271 3,643

Power Grid Co. of BD. Ltd.(POWERGRID)

Capital Market in Bangladesh

Future Prospects The capital market in Bangladesh yet far from its real potentials. From present stage, the major future events that will change the market are highlighted as:
Within 3 to 6 months 8 large profitable government

enterprises are going to be listed under Direct Listing Method adding value worth another 1 billion Dollar.
The Telecom Giants in Bangladesh are finalizing

their offers for IPO in the market.

Power and energy sectors demand for capital is 5

to 10 billion dollar within short time to meet the immediate needs of 5000 MW power demand. (Contd.)

Capital Market in Bangladesh Future Prospects (contd.)

A deep sea port requiring 1 billion dollar is

going to start with a policy decision that it will also be listed.

The Pharmaceutical sector and API enjoying

WTO benefit is growing sharply.

Textile sector as backward linkage to

thriving export oriented garments industries is booming.

Export oriented food processing industry

needs huge capital and technical capacity to meet the growing standards in global market for marine food, fruits and poultry.
IT sector with our talented developers, yet

to demonstrate the massive potentials of software industry of the country.

Capital Market in Bangladesh

Future Programs for Further Development
1. 2. Active market of government, municipal and corporate bonds beside the corporate bonds to create alternative investment. All securities to be brought under CDS within 2 years.

3.

All major infrastructure companies, specially those in power, telecommunication and energy sector are to be listed ensure to broaden the market depth with at least US$ 15 billion market cap by 2009 having daily average turnover from current level of average of 10 to 15 million dollar to a level of 70 to 100 million dollar 2 years.
To strengthen merchant banks capacity to be more active. Ensuring speedy disposal of decisions for market operation. Ensuring greater degree of transparency in financial disclosure and management structure for better corporate governance.

4. 5. 6.