The Chittagong Stock Exchange (CSE) registered a 36% growth in net profits for fiscal year 2021-22, thanks to increased investor participation in a vibrant stock market.
In FY22, its net profit was Tk39 crore, earnings per share stood at Tk0.61, and net asset value per share at Tk11.96. In the previous fiscal year, profits stood at Tk28.34 crore, with earnings per share of Tk0.45, and Tk11.75 in net asset value per share.
The CSE also recommended a 5% cash dividend for its shareholders at a board meeting on 28 September.
At present, CSE revenues come mainly from share transaction charges, company listing fees, member certificate renewal fees, service charges, and commissions.
For each transaction, it charges its brokers 0.023% of their turnover value. But for bulk transactions, it charges 0.004% which can be as much as Tk50 lakh on a single trade.
A senior officer of the stock exchange said a big portion of the total income comes from fixed deposits. Furthermore, the CSE's income increased because of greater investor participation in the stock market.
To diversify its business, the CSE is also going to start a commodity exchange. It has already signed an agreement with the Multi Commodity Exchange (MCX) - the largest commodity trading platform in India and the seventh-largest in the world. As per the deal, MCX will be consultant to the port-city bourse to build the first commodity exchange in Bangladesh.
A commodity exchange is a marketplace for commodities trading under set rules and regulations, and promotes the right grades of commodities, especially agricultural ones.
The bourse recently secured approval of the Bangladesh Securities and Exchange Commission (BSEC) to sell 25% of its stake to ABG Limited - a concern of the Bashundhara Group - for Tk238 crore. After the sale is completed, ABG Limited will become a strategic partner of the CSE.
The port city bourse began in 1995 to compete with the Dhaka Stock Exchange (DSE) which was established in the mid-1950s.