Trading Floor Silent Two Years After CSX Launch

It is almost two years to the day since Cambodia’s stock market launched in Phnom Penh in front of proud government officials, senior financiers and eager investors from across the region. Initial expectations were that a total of three state-owned firms would be listed within six months of the launch. None made the deadline. The Cambodia Securities Exchange (CSX) first witnessed traders on its floor on April 18 last year, when Prime Minister Hun Sen rang the opening bell after the Phnom Penh Water Supply Authority (PPWSA) secured its listing on the exchange. Now, the country’s bourse is virtually dormant. … The CSX is 45 percent owned by Korea Exchange with the remaining 55 percent owned by the government. While the opening of the bourse in 2011 featured both the chairman of Vietnam’s Vina­Capital—a $1.8-billion investment fund based in Vietnam—and representatives of New York-based multinational Blackstone Group, the only sign of life at the CSX on Tuesday was a discarded black sweater hanging over the back of a chair. … The only listed company on the CSX is the PPWSA, whose share price jumped 23 percent in the first week of trading—from 6,300 riel to 10,300 riel. But the stock quickly fell and on Tuesday closed at the same price it originally opened at last year. Securities firms have touted everything from a local restaurant chain to a Taiwanese garment factory as possible candidates to list. But nothing has yet materialized, and Telecom Cambodia, the state owned firm that operates landlines in the country, still has no end date in sight for making its long-awaited initial public offering (IPO). … The only other public entity to announce its intention to list is the Sihanoukville Autonomous Port, another state-owned firm. The port’s director-general, Lou Kimchan, said Tuesday that plans were ongoing to list on the exchange. … Suzuki Hiroshi, chief executive of the Business Research Institute for Cambodia, said the CSX’s tardiness in attracting more listings was partly due to the strict regulations in financial transparency and accounting that companies need to satisfy before listing.

Hul Reaksmey and Alex Willemyns