Safko Spinning Mills – a publicly listed manufacturer of cotton and polyester yarn – has seen a 65% surge in its stock price in less than two months, despite having halted production for the past year and a half.

At the Dhaka Stock Exchange (DSE), its share price shot up to Tk14.7 per share on 7 August, from Tk8.9 on 22 June.

Following this unusual rally, the DSE issued a letter to Safko Spinning Mills, asking whether there was any undisclosed price-sensitive information behind the sharp rise in share price and trading volume.

In its response on 10 August, the company stated there was no such undisclosed information influencing recent trading activity.

An examination of Safko Spinning’s financial statements shows that it has been out of production since January 2024. To confirm whether operations had resumed, a DSE inspection team visited the factory on 3 August and found it still closed.

When asked why the share price was climbing so sharply despite the prolonged production halt, Company Secretary Iftekhar Ahmed could not provide a specific reason. “We disclose all necessary information on the DSE website as required. There is nothing beyond what has already been published,” he told the Daily Sun.

On 2 June 2025, the company had announced: “The situation has not improved to the expected level due to the current economic turmoil in the textile sector and the scarcity and high prices of raw materials in the local market. Under these circumstances, the management has decided to extend the production shutdown for a further 2.5 months, until 16 August 2025.”

When asked whether operations could resume by that date, Iftekhar replied: “Only higher management can comment on that.”

Safko Spinning Mills, listed on the stock exchange in 2000, incurred a loss of Tk38.89 crore in the 2024-25 fiscal year and did not declare a dividend for shareholders.

According to its FY25 financial report, the company posted a loss of Tk6.75 per share in the first nine months, amounting to a total net loss of Tk20.23 crore.

A review of its performance over the past five years shows a loss of Tk17.05 crore in 2020, followed by profits of Tk67 lakh in 2021 and Tk98 lakh in 2022. The company then fell back into losses in 2023, posting a net loss of Tk16.53 crore.

Of its total shares, 30% are held by sponsors and directors, 7.08% by institutional investors, and 62.92% by general investors. As of the close of trading on Monday, the share price stood at Tk14.40, down 0.69% from the previous day.