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The shareholding of the directors of the company dropped during these periods so the question came to the fore whether the directors benefited from the share price movement, the asset manager added.

On June 30 of 2020, the company’s sponsors held 33.83 per cent shares of Aziz Pipes. It reduced to 23.93 per cent on August 31 this year.

Here, the sponsors have breached laws as they did not give any announcement about the sales though it is mandatory as per the Corporate Governance Code of 2018.

The code stipulates that every sponsor or director of a company must submit a written report to the exchange and the Bangladesh Securities and Exchange Commission about their intention to buy or sell. The exchange will disseminate such information.

“ICB is our director, and it sold shares, but it said that they don’t need to give any disclosure about the share sale,” said AHM Zakaria, company secretary of Aziz Pipes, referring to the state-run Investment Corporation of Bangladesh.

“I do what our directors instruct me to do,” he said.

Abdul Mannan, a retail trader, said he had bought shares of Aziz Pipes at a market price of Tk 154 after it disclosed its plan to restart production.

“Suddenly, the stock started to fall. Now, with the announcement of the shutdown, the stock fell further, and I incurred losses. This is upsetting,” he added.

As the raw material price surged, the price of the products manufactured by Aziz Pipes doesn’t cover the production cost, he said. “So, we decided to close the factory,” said Zakaria.

A senior official of the BSEC said the commission would look into how the directors sold shares without giving any disclosure and whether any insider trading took place.

In the 2020-21 financial year, Aziz Pipes incurred a loss of Tk 43.9 lakh, after logging a profit of Tk 13.91 lakh a year earlier, according to the company’s financial report.

Due to the loss, the company declared no dividend for shareholders. It provided a one per cent cash dividend in 2019-20.

The company has defaulted on its payments to loans with Dutch-Bangla Bank Ltd and Uttara Bank.

Shares of Aziz Pipes closed 4.5 per cent higher at Tk 92.80 on the Dhaka Stock Exchange yesterday.