The stock market regulator has initiated a move to look into the business potential of the companies trading over-the-counter (OTC) as part of efforts to bring them back to the main board of the exchanges.

The Bangladesh Securities and Exchange Commission (BSEC) has instructed Dhaka and Chattogram stock exchanges to appoint special auditors to review the business potential of 21 companies that are in operation.

"We want to examine the better companies of the OTC market and bring them to the main board," said a top official of the BSEC, preferring anonymity.

"We are analysing their potential. Let's see how many companies we can find fit for the main board."

The OTC market provides an alternative to stock exchange listing for securities of issuers that either choose not to be listed on the DSE or do not to meet the relevant listing requirements, according to the DSE website.

At present, 64 stocks trade on the OTC. 

The regulator also ordered the bourses to submit an in-depth report on another 43 companies that are also listed with the OTC market.

The bourses will evaluate the financial reports of the companies along with their business performance, production capacity, land and other tangible assets.

Retail investors welcome the move.

These companies have raised funds from the investors but pay nothing in return. Moreover, some don't communicate with the shareholders, said one investor.

Among the OTC-based companies, the DSE could not trace 11 companies.

Some investors say the commission could bring them under accountability as sponsors of some of the traceless companies are doing other businesses in the country.

Earlier, the regulator moved to review the business potential of the junk stocks, find out the companies that have shut, have been incurring losses or failing to hold an annual general meeting regularly. The review is underway.

The decisions from the regulator came after the appointment of the new commission led by Prof Shibli Rubayat Ul Islam, which aim at bringing discipline into the market and restoring the confidence of investors.