Logo of Phnom Penh Post newspaper Phnom Penh Post - PPSP begins trading on stock exchange

PPSP begins trading on stock exchange

Lim Chiv Ho (right), CEO of the Phnom Penh Special Economic Zone, rings the bell during the IPO at the Cambodia Securities Exchange yesterday morning in Phnom Penh.
Lim Chiv Ho (right), CEO of the Phnom Penh Special Economic Zone, rings the bell during the IPO at the Cambodia Securities Exchange yesterday morning in Phnom Penh. Athena Zelandonii

PPSP begins trading on stock exchange

Shares in Phnom Penh SEZ debuted on Cambodia’s nascent stock exchange yesterday morning, ending the day at 2,890 riel ($0.71), down slightly more than 3 per cent from its opening price of 2,980 riel after an underwhelming level of trading.

The company, which trades under the letters PPSP and operates the most successful industrial park in the country, became the fourth listed company on the Cambodian Securities Exchange (CSX) after successfully raising $8.2 million from its initial public offering (IPO) earlier this month.

While Phnom Penh SEZ primarily gathered the attention of institutional investors from Thailand, Japan and Malaysia when it offered 11.6 million shares during its bookbuild – a 20 per cent stake of its enlarged issued share – the entire 58 million shares were released to the public yesterday morning.

Speaking before the start of trading, Lim Chhiv Ho, chairwomen of Phnom Penh SEZ, said the decision to become publicly listed was rooted in the company’s push to keep growing and remain the most attractive investment destination in Cambodia.

“Funds from the IPO, which our current shareholders have already committed to investing into the company and its future expedite the company through to the next stage of development,” she said.

The IPO capital is set to fund the expansion of its 347-hectare special economic zone in Phnom Penh, as well as the construction and development of a new 53-hectare SEZ on the Thai border near Poipet.

At 9am, Lim Chhiv Ho joined hands with Hong Sok Hour, chief executive officer of the CSX, to ring the bell to signal the start of trading. Fong Nee Wai, chief financial officer of Phnom Penh SEZ, said that while it was hard to predict, he hoped that “40,000 to 50,000 shares” would be initially traded.

“It is hard to say, but the first day there is usually an observation period. I expect that most investors will hold onto their shares and see what happens over the next few days,” he said.

Those hopes of high-level trading were quickly dashed as the initial share price set at 2,980 riel – 4.2 per cent higher than the IPO price– sank down to 2,890 riel and stayed that way until trading ended at 11:30am. While it still posted an overall gain of 1 per cent, some 24,078 shares changed hands by the end of the morning, amounting to $17,663.

By comparison, Phnom Penh Autonomous Port (PPAP), the third listed company which debuted to the public last December after successfully raising $5.2 million in an IPO, showed a similar level of trading on its opening day at 13,050 shares worth $17,000.

Speaking on the sidelines of the CSX, Lim Chhiv Ho said that the trading volume did not disappoint. “We have expected that this will be a step-by-step process,” she said, adding that trading volumes would likely grow over the following weeks.

John Menzies, chairman of Cmi Capital Limited, explained that seeing a privately owned, solely-Cambodian-registered company list on the CSX was a milestone in itself.

“I believe that in the future, with the Phnom Penh SEZ being able to generate a successful IPO, we will see more infrastructure companies looking to list,” he said.

While he noted that overall the capital markets in Cambodia lack available liquidity, once more companies jump on board, trading volumes will increase. Svay Hay, president and CEO of Acleda Securities, explained that the low level of trading showed that the majority of investors were committed to long-term gains.

“Most of [the] investors shall buy and stay long with the company for [a] high dividend yield,” he said, adding that those investors would enjoy sustained growth.

While he explained that many retail and medium-size investors would cause fluctuations of price and volume during the initial trading, due to the fact that PPSP was offering nearly 58 million shares “the bigger size of supply may cause the volume to [trade] at below average for a while”.

“Then, the corporate and income investors shall buy more [during these] small fluctuations,” he said.

Phnom Penh SEZ generated $23.4 million in consolidated revenue and $5.9 million in net profit in 2014, the latest full year publicly available.

MOST VIEWED

  • No word on state of emergency

    The National Assembly (NA) said it will postpone all unnecessary meetings in line with guidance from the Ministry of Health and the World Health Organisation (WHO) amid the Covid-19 pandemic. However, it did not say when or how it will debate the “state of emergency”

  • Many in limbo as tension heightens

    As the Kingdom restricts travel and prepares for a state of emergency, some foreigners in Cambodia are scrambling for a way home. Foreign embassies in Phnom Penh are making efforts to get their citizens out, but cancelled flights have become common due to the coronavirus

  • State of emergency draft law set for NA

    A draft law aiming to place the Kingdom in a state of emergency amid the Covid-19 pandemic is set for a debate at the National Assembly (NA) after going through the Council of Ministers’ Standing Committee meeting led by Prime Minister Hun Sen on Tuesday.

  • NA, Senate set for bill on ‘emergency’

    Prime Minister Hun Sen has requested the Senate to convene an extraordinary meeting to review the draft law that aims to put the Kingdom in a state of emergency after the bill reached the National Assembly (NA) on Friday. The draft law, which was approved

  • Hun Sen, ministers, officials donate salaries in virus fight

    Prime Minister Hun Sen and other senior government officials have decided to donate their salaries to the National Committee for Combating Covid-19 in support of the ongoing battle against the coronavirus. Hun Sen announced in an April 1 letter that because the Covid-19 situation in Cambodia

  • Economic growth to shrink to 2.3% in 2020, ADB says

    The Asian Development Bank (ABD) has slashed Cambodia’s 2020 gross domestic product (GDP) growth to 2.3 per cent from its initial 6.8 per cent forecast due to the slowdown in major economies and China and reduced access to export markets. However, growth is projected to trend upwards