Cambodia's Securities Exchange (CSX) may have its first private company listing early next year with Grand Twin International, a Taiwanese-owned garment factory, submitting its letters of intention to the Securities Exchange and Commission of Cambodia (SECC).
Industry representatives and government officials believe the listing will be a much-needed boost to the momentum of Cambodia’s recently established bourse, which has only one stock listed since its April opening.
Grand Twin International signed IPO preparation contracts with Phnom Penh Securities in June last year while TY Fashion, also Taiwanese-owned, signed its contracts in July.
Stephen Hsu, CEO of PPS, said after more than one year of work the two companies submitted their letters of intention to the SECC at the end of 2011.
“We are working with both factories at the same time, and the progress is going well. Now is the final stage. After these two companies finish modifying their articles [organisational structure] from the Ministry of Commerce, they will apply for permission to list officially,” he said.
“We expect they can successfully list in the market by the beginning of 2013. However, they will go public one-by-one in order to ensure a smooth process and fruitful result for all stakeholders,” said Hsu.
“The law and audit firms do their jobs carefully and discreetly, so it takes time to accomplish the work,” he added.
Ming Bankosal, director general for SECC, said he has not received the disclosure documents from the company, saying that any company wishing to list on the CSX is required to submit that document to the SECC for approval.
“They need to submit the disclosure documents to us to check whether they have met our requirements,” he said.
“If their document meets our requirements, we will approve them,” he added.
“Anyway, I do applaud the private companies wanting to go public on the bourse because it will grow our economic activities,” said Ming Bankosal.
Svay Hay, director of Acleda brokerage firm, said the listings will make the market more active. “Our stock market is progressing gradually even though we only have one company listed,” he said.
“At the same time, if we have more companies listing, it will attract more investors to the market,” he said, adding that so far, around 10 companies, both private and state-owned, expressed a desire to list on the CSX.
The CSX officially opened for trading in mid-April this year with only one state-owned company, the Phnom Penh Water Supply Authority (PPWSA).
The government also plans to list two other agencies, Telecom Cambodia and the Sihanoukville Autonomous Port, at some point next year. However, both companies declined to confirm the exact date for when they will be available for trading.
The garment industry is the largest non-agricultural industry in Cambodia and the Kingdom’s largest provider of formal employment.
To contact the reporter on this story: May Kunmakara at [email protected]