New IPO Allotment from April 1

IPO shares will be allotted at a proportional rate from April 1, 2020 which has been confirmed by DSE & BSEC.

Dhaka Securities Commission (DSB), Chittagong Stock Exchange (CSE) and Central Depository Bangladesh (CDBL) have been instructed by the regulatory body Bangladesh Securities Commission (BSEC).

The directive, signed by BSEC chairman Prof Shibli Rubaiyat-ul-Islam, was issued on Thursday (January 21st).

The BSEC has also directed DSE, CSE and CDBL to have the Electronic Subscription System (ESS) ready by March 31 to introduce the new rules on April 1.

However, the committee formed in this regard thinks that more time is needed to introduce this new rule. The committee said it would take until June to modernize the ESS to implement the initiative. The issue of time came up in the meeting of the committee formed in this regard on January 10 at BSEC.

It may be mentioned that BSEC issued a directive at its commission meeting on December 31 stating that it would allocate a proportional rate for the shares of the company that came up in the IPO. According to the directive, everyone who applies for an IPO will get a proportional share. However, to apply, ordinary investors must have a minimum investment of Rs 20,000 in a company listed on the stock exchange. In addition, general investors are required to apply for an IPO of at least Rs 10,000 or more.

It was also informed on the same day that these decisions of the commission will be effective from April 1. But the committee discussed at its January 10 meeting that it was risky to implement the ESS process quickly because it was time-dependent. If implemented quickly, technical complications are expected to occur.

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