Jute Spinners, a junk stock, incurred a net loss of Tk 55.25 million in nine months for July 2021 to March 2022 while the company's accumulated loss stood at Tk 741 million.
The company has reported loss of Tk 32.50 per share in nine months for July 2021 to March 2022 as against loss of Tk 33.83 per share in the same period last year, according to a filing with the Dhaka Stock Exchange (DSE) on Sunday.
Jute Spinners has reported net asset value (NAV) per share was Tk 426.07 in negative as on March 31, 2022 and Tk 393.57 in negative as on June 30, 2021.
The company's factory remained shut from 2016 and no revenue was generated since then.
Despite not being in operation and failing to provide dividend for long, its share price rose more than 8.0 per cent in 12-trading day to close at Tk 138.60 on Sunday in the falling market which is unusual in comparison to the current status of the company, according to market insiders.
Its shares traded between Tk 90 and Tk 192 in the last one year.
According to the auditor's report for the year ended June 30, 2021 published earlier, the company's liabilities stood at Tk 688.60 million which exceeded its total assets of Tk 289.07 million by Tk 399.52 million as on June 30, 2021.
"We also drew attention to the labour difficulties, inability to pay creditors on due dates, adverse key financial ratios, discontinuance of dividends, inefficiency of key management and negative net asset value and operating cash flows indicated by financial statements of the company," said the report published in November 2021.
The report gave an opinion that these events or conditions indicate that a material uncertainty exists that may cast significant doubt on the company's ability to continue as a going concern.
As the company is not in operation for more than six years, reporting assets without any impairment review shall overstate/understate the fixed assets value as of reporting date.
In spite of poor performance, its unusual price movement prompted the DSE to serve notice on the company whether there was any price sensitive information for unusual price hike.
The company, in replies however, informed the premier bourse that there is no price sensitive information for recent unusual price hikes.
Market insiders blamed price manipulation due to a small volume of shares being behind the artificial crisis.
"The company's paid-up capital is very low, making it a target for gamblers seeking to manipulate trading," a merchant banker said.
Its paid-up capital stands at Tk 17 million while the total number of securities is 1.70 million.
"The influential investors by disseminating rumours are trying to manipulate the prices of shares of many companies to make quick-profit," he said.
He said the investors are chasing these stocks without conducting any proper analysis, as they see continuous rise in values.
He noted that investors should be careful about the unusual price hike of the low-profile companies and should not pay any heed to rumours at the time of trading shares.
The company, which was listed on the DSE in 1984, failed to declare dividends over the years.
Sponsor-directors own 39.82 per cent stake in the company while the institutional investors own 23.20 per cent and the general public 36.98 per cent as of March 31, 2022, the DSE data shows.
