The Daily Star
A steady performance by energy and power sector companies has made their stocks lucrative, leading to an increasing demand for their shares among the investors.
The rising demand is evident from the last month's sectoral turnover on the Dhaka Stock Exchange (DSE), wherein energy and power sector topped with Tk 1,478.08 crore turnover, which was 15.47 percent of the total turnover.
But in February the sector was in fourth place with Tk 674.27 crore turnover, which was 11.76 percent of the total turnover, according to DSE statistics.
The trend shows that the investors were much interested in energy and power sector companies than others.
Investors and analysts said without energy and power, development activities will come to a standstill.
"Here lies the potential of energy and power sector," said an investor.
Except only one out of the 10 listed energy and power companies, business performances of all are remarkable with steady profit.
Of those companies, Power Grid Company of Bangladesh (Powergrid), Dhaka Electric Supply Company (Desco), Titas Gas Transmission and Distribution Company, Summit Power and Padma Oil Company are the most lucrative for the investors.
The five other companies are Jamuna Oil Company, Meghna Petroleum, BOC Bangladesh, Eastern Lubricants and Bangladesh Welding Electrodes (Bd Welding).
Bd Welding is the only company whose performance is not up to the mark for the time being.
Powergrid, the state-run power transmission company that was listed in 2006, has been maintaining a steady growth since 2004. The company made a net profit of Tk 169.26 crore in 2008 against Tk 125.37 crore in 2007 and Tk 61.99 crore in 2006.
Another state-owned power supplier, Desco, which was also listed in 2006, has been continuing strong business growth since 2004. The company's net profit in 2008 was Tk 100.08 crore, while the profit was Tk 71.10 crore in 2007 and Tk 57.87 crore in 2006.
The balance sheet of Titas Gas, another state-run entity that distributes natural gas to greater Dhaka, greater Mymensingh and Brahmanbaria, shows its steady performance since 2005. The company, which was listed early last year, made a net profit of Tk 421.82 crore in 2008 against Tk 257.52 crore in 2007 and Tk 206.44 crore in 2006.
Summit Power, a concern of Summit Group and the first Bangladeshi independent power producer, has been maintaining tremendous business since its inception in 2001.
Summit, the only local company in private electricity generation and supply business, is adding power to the national grid and was listed in 2005. It made a net profit of Tk 26.51 crore in 2007 and Tk 17.51 crore in 2006. The company's net profit as of June 2008 was Tk 22.54 crore.
All the energy and power companies have a huge potential, said Salahuddin Ahmed Khan, former DSE chief executive officer.
"If their potential is tapped properly, investment from both home and abroad will come to the sector," he said.
He however said in case of failure to exploit their potentials, the stock prices of the sector will be overpriced and ultimately investors will lose money when the prices of the shares will see corrections.
Padma Oil, Jamuna Oil, Meghna Petroleum, BOC Bangladesh and Eastern Lubricants are also maintaining steady growth.
Bd Welding incurred a net loss of Tk 0.69 crore in 2007 against a net profit of Tk 0.24 crore in 2006. However, as of June 2008 the company made a net profit of Tk 0.40 crore.