ETL delays IPO

ETL delays IPO

Investors who are anticipating buying shares in Enterprise of Telecommunications Lao will have to wait a little longer as the management is still unable to give an exact timeframe for the Initial Public Offering (IPO).

ETL Director General Mr Khammouane Xomsipanya said yesterday the company could not yet say when it would list on the Lao Securities Exchange because it is awaiting government approval.

“We are still waiting for approval from the government so we can't set up a timeframe for the IPO,” he told Vientiane Times .

ETL, one of four telecom operators in Laos, delayed its planned IPO at the end of last year, citing an unfavourable global economic climate. It had intended to sell 30 percent of government-owned shares to the public.

The government had planned to list ETL and two privately owned firms - Lao World Group and Indochina Group - on the Lao stock market at the beginning of this year. But so far there has been no sign that they are willing to sell shares to the public.

According to a source, ETL has informed Lao Securities Exchange officials in a letter of its intention to delay the IPO and stock market listing until the LSX offers internet-based trading and block trading.

ETL expressed the belief that when online stock trading and block trading are made available, it will enable investors to purchase large volumes of stocks, which it views as instrumental in attracting share purchasers.

Lao Securities Exchange Chairman and CEO Mr Dethphouvang Moularat said the LSX expects to offer online stock trading in the first quarter of this year, adding that the move will facilitate investment in the Lao stock market.

The LSX signed an agreement with ETL last month to provide a high-speed, stable internet connection. This is essential to prevent disruption when people post buy and sell orders through the internet-based home trading system.

According to ETL, the government will sell 30 percent of its shares. Five percent will be offered to ETL staff, 15 percent to Lao nationals and 10 percent to foreign investors.

ETL has about 960,000 mobile phone subscribers and is confident it can attract more customers despite strong competition in the domestic telecom market.

The company faces strong business competition. However, a recent decision by the four telecom operators to set a minimum cell phone call rate is expected to boost revenue. ETL expects an earnings increase of more than 10 percent in 2012 in the wake of this agreement.

vientiane times