BANGLADESH

The capital market is in freefall but even so, the prices of several overvalued companies continue to climb.

The firms on top of Dhaka Stock Exchange's gained issues include Tallu Spinning, MB Pharma, Desh Garments, BD Autocars and Pharma Aids.

All these companies have a PE ratio of 75 to 245. Shares are considered overvalued when their PE ratios exceed 40, and loan facility for their purchase is withdrawn.

Former SEC chairman A B Mirza Azizul Islam told bdnews24.com that expected PE ratio for any share should be 15.

"Up to 20 is acceptable. But anything more than that is risky and overvalued," he said.

DSE general index has plummeted 5.25 percent in the last week, with 242 issues falling. But the five companies on top of the list have advanced nine to 15.23 percent.

Tallu Spinning shares rose 15.23 percent in a week. Shares face valued at Tk 100 have been traded last at Tk 700 each. The 'A' category company now has a PE ratio of 245.47.

Desh Garments shares rose 10.47 percent. Shares face valued at Tk 100 were traded last at Tk 719 each. The 'B' category garments sector company now has a PE ratio of 222.86.

Shares of BD Autocars, a 'B' category engineering sector firm, rose 10.7 percent last week. Shares face valued at Tk 100 have been traded last at Tk 622.50 each. The company now has a PE ratio of 155.92.

Pharma Aids shares rose nine percent. Shares face valued at Tk 100 were traded last at Tk Tk 3068 each. The 'A' category pharmaceutical and chemical company now has a PE ratio of 75.41.