The consultative committee ol the Securities and Exchange Commission has recommended that the market regulator set a uniform face value of shares at Tk 10.

The committee also proposed fixing a common market lot of250 shares or shares worth Tk 2.500.

The committee made the recommendations at a meeting yesterday. The consultative committee comprises representatives from Dhaka Stock Exchange, Chittagong Stock Exchange, Central Depository Bangladesh Ltd (CDBL) and SEC.

An official who was present at the meeting said the committee had argued that a divergence in face value only misleads investors, especially retailers.

The investors often compare the prices of one stock with another, although they do not have the same face value. For this, share prices, even of weak companies, often go up abnormally, ultimately upsetting the market, officials said.

"Almost all developed nations have uniform or common face value for shares in stock exchanges, but the range of face value of shares is very wide in our market,” said an official.

The Bangladesh stock market has shares with face value ofTk 1,000. Tk 100. Tk lOandTk 1. If all shares have a uniform face value, it will make the onscreen comparison between scrips more meaningful, the officials said.

The consultative committee proposed a one-year period for converting all share prices of listed companies to Tk 10.

Dhaka Stock Exchange has 198 securities with face value ofTk 100,63 with Tk 10,two with Tk 1,000 and one with Tk 1.

The committee also recommended that the listed companies, whose annual general meetings are close, should split their share prices in upcoming AGMs. Titas Gas, Desco and Powergrid will hold their AGMs soon.

The committee however made a proposal not to split the per unit price of AIMS First Mutual Fund, the lone security withTk 1 face value.

Market insiders said if die consultative committee's recommendations are approved and implemented by the SEC, the initiative would bring a positive result to the market.

The unusual price movement of shares with lower face value or Tk 10 shares, which are now dominating the price chart, will be stopped then, they said.

It is often seen that retail investors are much focused on shares with lower face value. “With the latest initiative, the investors will be able to make comparison between stocks easily," said a market analyst.

sarwar@thedailystar.net