CSX equity market cap declines 10% despite rise in investors
CSX equity market cap declines 10% despite rise in investors
The Cambodia Securities Exchange (CSX) reported a total market capitalization of KHR 11.22 trillion, approximately $2.73 billion, for its equity market at the end of Quarter 2 (Q2), 2024, a decline of 10.09 percent compared to the same period last year.
According to a report released yesterday, the CSX index at the end of Q2 this year was 414.14, a decrease of 9.36 percent compared to Q1, 2024 and 10.14 percent compared to Q2, 2023.
The decline in market capitalization compared to Q1, 2024, was estimated at 9.34 percent.
Currently, there are two types of securities, stocks and bonds, traded on CSX. For the equity market, there are 11 listed companies of which nine are listed on the Main Board and two on the Growth Board.
The total trading volume was approximately 10.59 million shares, in which the Main Board accounted for 92.39 percent and the Growth Board accounted for 7.61 percent during Q2, 2024.
The total trading volume recorded an increase of 211.75 percent compared to Q1, 2024. The total trading value stood at approximately KHR 53,027.35 million (about $12.90 million).
The trading value in KHR declined by 15.73 percent and in USD 15.32 percent in Q2, 2024, compared to the same period last year.
The daily average trading value was 898.77 riels, a decline of 12.87 percent compared to the same period last year.
In the Main Board, the total market capitalization was approximately KHR 1.11 trillion (about $2.70 billion).
The total buy-sell orders were approximately 65.98 million shares, among those the total buy orders were approximately 29.92 million shares while the total sell orders were approximately 36.06 million shares.
The total trading volume in the Main Board was approximately 9.78 million shares, an increase of 200.30 percent, compared to Q1, 2024 and 39.31 percent compared to Q2, 2023. The trading value stood at KHR 51,117.02 million (approximately $12.44 million), increased by 147.12 percent compared to Q1, 2024 but declined by 17.63 percent compared to Q2, 2023.
For Growth Board, the total market capitalization was approximately KHR 107,282 billion (approximately $26.10 million), a decrease of 6.97 percent compared to Q1, 2024. The total trading volume was approximately 0.81 million shares, showing an increase of 480.11 percent, while the trading value was approximately KHR 1,910.33 million (about $0.46 million), an increase of 443.25 percent compared to Q1, 2024.
In all, 7,384 investors participated in the equity market, an increase of 21.41 percent, compared to Q1, 2024. Among these, Cambodian investors constituted approximately 97.17 percent.
Acleda Bank Plc. (ABC) was the largest traded script, accounting for 41.68 percent of the trading volume during the period. The script also recorded a market capitalization of $800.98 million.
In the bond market, there were 12 companies that issued corporate bonds. Currently, there are 10 listed corporate bonds, while the other seven corporate bonds reached maturity. However, there was no trade at all in the bond market during this period.
Meanwhile, the declining trend in the capital markets in Cambodia led to calls for urgent remedial measures. Anthony Galliano, CEO of Cambodian Investment Management Group, told Khmer Times that the performance of the capital markets in Q2 is not promising at all and begs for sharper attention and engagement.
“Daily trading value and volume remain light and international investors will require improvement in these key metrics to gain confidence in the market,” Anthony said while emphasizing the role of Foreign Portfolio Investment (FPI) for the economic development of Cambodia.
According to him, domestic interest in the capital markets remains tepid, probably due more to a great lack of understanding of financial markets which needs very urgent steps for education.
Anthony pointed out that CSX is 13 years old, but still, there is a strong reluctance from local companies to list, resulting in only 11 stocks listed on the exchange.
“While the situation may seem bleak, it is indeed one of the greatest opportunities the country has and may very well be one of the brightest spots in its economic future. This may well require a top-down approach with the government doing the 3 ‘Es’ – encourage investment, educate the population and ease restrictions on investment where large pools of capital can be redeployed into the markets,” he noted.
According to Anthony, the focus on Foreign Direct Investment (FDI) in Cambodia has been intensely accelerated of late which includes a focus on diversifying the investment base given the concentration, if not dependency, of investment flows from China.
“While FDI project-based investment has been the traditional mechanism, the country needs to embrace the next phase in its development – the abundant generator of FPI for the capital and financial markets. Cambodia has a well-functioning financial sector with the benefit of market liberalization and therefore has a great opportunity to spur growth through financial market development,” he said.
In Anthony’s view, FPI inflows increase the liquidity of domestic capital markets, play a vital role in developing market efficiency, result in more corporate compliance with global standards in accounting and provide financing for domestic companies and facilitate entrepreneurship.
