Bangladesh’s Alternative Trading Board (ATB), launched to help non-listed companies trade shares and bonds, is facing challenges in attracting businesses and investors, but its potential to boost the economy remains strong. Designed to support trading of private company shares, bonds, mutual funds, and alternative investments, the ATB allows sponsors to sell up to 49 percent of their shares without raising public capital. Despite relaxed listing rules and low costs, only one company, LankaBangla Securities, and six corporate bonds are currently listed, largely due to strict share valuation rules and limited investor interest. The current regulations cap share prices at 30 percent above net asset value, which many companies find unfair, as it doesn’t reflect their true growth potential or future earnings. For example, a past private deal saw shares sold at a much higher value, highlighting how earnings potential can drive prices far beyond net assets. This restriction discourages companies from joining the platform, as they feel it undervalues their worth. Additionally, low trading activity makes the ATB less appealing, with daily turnover often below Tk 1 million and some days seeing no trades at all. Previously, a rule preventing investors from keeping profits made within three months of buying shares further deterred participation, though this was lifted last year to encourage activity. Another hurdle is the lack of awareness among entrepreneurs and investors, with many unaware of the ATB’s benefits, like low listing fees and exemptions from strict financial reporting. Experts suggest that better outreach by the Dhaka Stock Exchange and the securities regulator could spark interest, helping startups and growth companies find investors. The platform’s low-cost structure, with no stamp duty and simple requirements, is a major advantage for businesses looking to grow without heavy expenses. If promoted effectively, the ATB could become a vital tool for angel investors and startups seeking exit routes for their investments. By addressing valuation concerns and boosting awareness, the platform could attract more companies, increase trading, and create a vibrant market for private securities. This would support Bangladesh’s growing economy by connecting innovative businesses with eager investors, fostering job creation and financial growth. With the right changes, the ATB has the potential to transform how private companies access capital, making it a key player in the nation’s financial future.
