Value of stock exchange in secondary market decreases last year

The decrease in value is due to decrease in price of shares as compared to 2019

The value of stock exchange in the secondary market decreased last year as compared to 2019.

However, the volume of shares traded increased.

Last year, 24.68mn shares were traded for Nu 863.07mn and in 2019, 23.61mn shares were traded for Nu 1.12bn.

In 2018, total traded value was Nu 384.26mn and in 2017, traded value was Nu 125.68mn.

Secondary market is the market where previously issued securities, such as stocks and bonds are traded among investors.

The primary market is where securities are created. It is in this market that firms sell or float new stocks and bonds to the public for the first time.

In 2019, Sherza Ventures Limited (SVL), an E-commerce and Trading company floated Initial Public Offering (IPO) to raise Nu 247mn.

The market capitalization of 22 listed companies has reached up to Nu 46.15bn as of January 2021. In 2019, the market capitalization was Nu 51bn as of January 3, 2020.

The market capitalization of 21 listed companies as on December 31, 2018 increased by Nu 9.65bn as compared to 2017 from Nu 25.58bn to Nu 35.23bn.

The Chief Executive Officer of RSEB, Dorji Phuntsho said that the decrease in value is attributed to the decrease in the price of shares for most of the companies.

“After the lockdown there was decrease in prices,” said the CEO.

He said that though there was increase in volume of shares traded, most of the listed companies’ share prices decreased.

He mentioned that there was decrease in price of companies like Bhutan National Bank, RICB, Tbank and Druk PNB.

In 2019, the BNB market price was Nu 35.5; last year it dropped to Nu 30.10.

Similarly, the market price of RICB was Nu 78.50 in 2019 while last year the price dropped to Nu 66.40 and Tbank market price was Nu 48 in 2019 but in 2020 the price dropped to Nu 38.

“The reason for price decrease could be attributed to impact of the COVID-19,” he said.

He said that the other reason could be that the prices are determined by the willingness of the sellers to sell at a particular price and that of the buyers to buy at a price acceptable to them.

The stock market is picking up as compared to the previous one in the country even as shares are being traded online and daily transactions in the stock market can be seen.

With the literacy and advocacy on stock market, the stock exchange market has picked up over the years.

During the second lockdown, from January 11 to 15, the number of shares traded was 68,890 shares for Nu 2.08mn.

There were 32 users and 114 trades executed with 12 companies.

2,351 shares r worth Nu 85,639.95 were bought and 5,764 shares worth Nu 129,046.75 were sold through mCaMS with 26 users. mCaMS is a mobile application to trade online.

Dechen Dolker from Thimphu