The DSE did not comply with the first circular that asked it to list the company, as the conditions of compensation would create complexities and contradict the securities law, said a DSE official.
However, the Chittagong Stock Exchange (CSE) approved the listing in a condition of compensation and the company made a trade debut yesterday.
"We will take action against DSE, if they do not follow our circular," said an official of SEC.
The DSE should list the company as the CSE has already done so, he adds.
DSE sent a letter on May 3 to the SEC, explaining 11 points of negative impact of compensation on the market.
In line with the letter: "The introduction of the concept of compensation for the equity mark shall be nothing but risky. There is no such instant compensation for the capital market in the world. The compensation goes against the basic concept of equity investments. The matter of compensation means the primary issue price of the share is not justified."
"Some investors will use the chance to manipulate MI Cement share prices as they will sell shares too close once to get compensation, while the compensation will involve the investor for circular trading." But, the SEC rejected it and issued a circular to list the company to the bourses.
In another development, SEC has increased the listing period of MJL Bangladesh Ltd to end the listing stalemate.
Source: The Daily Star (May 9, 2011)
