Logo of Phnom Penh Post newspaper Phnom Penh Post - Malaysian firm to list on Cambodian stock market

Malaysian firm to list on Cambodian stock market

A monitor displays stock information next to the reception of the Cambodia Securities Exchange last year.
A monitor displays stock information next to the reception of the Cambodia Securities Exchange last year. Heng Chivoan

Malaysian firm to list on Cambodian stock market

Cambodia’s fledgling stock exchange could receive a much-needed boost after Malaysian-owned power infrastructure provider Pestech Cambodia officially submitted its application for an initial public offering on the CSX, industry insiders said yesterday.

Lamun Soleil, director of market operations at exchange, said Pestech Cambodia’s application was now being reviewed, and its listing was expected in the third quarter of 2018.

“This is a good sign, and shows that [Pestech] has confidence in our market,” Soleil said, adding that he was optimistic that trading activity on the CSX would gain momentum in the upcoming year. “Once there are more companies listed on the exchange, there will be more products for investors to trade, which help the market become more active.”

According to a filing on the Malaysian stock exchange, Pestech hopes to raise as much as $20.3 million through its initial public offering (IPO) on the CSX with an indicative price of $0.70 for 29 million shares, representing up to 29 percent of the company’s value. Eight million of those shares are to be made available to the public, with the rest earmarked for select investors as well as directors, employees and business associates, the filing says. Pestech’s application was submitted to the Securities and Exchange Commission of Cambodia on December 22, it says.

David Van, executive director of Deewee Management, said the Pestech listing could help “reinvigorate the struggling CSX”, not only encouraging growth in the Kingdom’s electricity sector but also contributing to the strengthening of Cambodia’s institutional framework.

“Considering [Pestech Cambodia’s] parent company is already listed in Malaysia, we should expect it to operate within ethical norms and with good governance,” he said.

Stephen Higgins, managing partner of Phnom Penh-based investment firm Mekong Strategic Partners, agreed that more listings on the CSX would help lift the market’s liquidity, “which is a major problem at the moment”.

“It’s not clear to me however that the underlying business model of Pestech is as attractive as other stocks like the ports,” Higgins added.

Pestech says in its filing that it is currently operating with a negative working capital, and intends to use the IPO to finance its extensive projects in the Kingdom.

Earlier last week, the company announced that it had won a $26 million job to begin construction on three new electricity projects in Cambodia, including a new substation in Phnom Penh as well as two substations and a 115kV transmission line in Oddar Meanchey.

Additional Reporting by Robin Spiess

MOST VIEWED

  • All Covid restrictions for inbound travellers lifted

    Cambodia has apparently taken the final step towards full reopening of the country without Covid-19 restrictions by removing all requirements for inbound travellers, who until now had to show health certificates indicating that they have tested Covid-19 negative in the past 72 hours as well as

  • Typhoon Noru brings flash floods – 16 dead

    An official warned that that the 16th typhoon of the season, Noru, had brought heavy rains to areas the Mekong River and flooded thousands of homes in the provinces bordering Thailand. As of September 27, the death toll from the flooding had risen to 16. National Committee

  • Cambodia stands firm on 5PC: No invite for Myanmar to ASEAN Summit this year

    Cambodia has not invited Senior General Min Aung Hlaing, chairman of Myanmar’s ruling State Administration Council (SAC), to the 40th and 41st ASEAN Summit and related meetings scheduled for next month in Phnom Penh. The government will instead invite a non-political representative from Myanmar

  • Mushrooming borey projects and home financing – a cause for concern?

    A spurt in housing developments is typically a sign of a growing economy but underneath all that might lay some anxiety of credit growth as developers offer financing to buyers at higher rates, an activity the central bank identifies as ‘shadow banking’ Earlier this year,

  • Thai Senate delegates in Cambodia to discuss anti-graft co-op

    A delegation from Thailand's Senate was in Phnom Penh on September 28 to meet their Cambodian counterparts to discuss strategies for fighting corruption and enhancing cooperation. The Thai delegates were from its Senate’s Committee on Studying and Inspecting Corruption, Misconduct and Strengthening Good Governance. They

  • Scholarship winner tells secrets to success

    Chhim Chaknineath was awarded the Chevening Scholarship for one year of postgraduate study in the UK for the academic year 2022-2023 along with a group of 10 other outstanding students who applied. She spent more than a year researching and studying – as well as consulting with