Phnom Penh Post, Written by Steve Finch THURSDAY, 28 MAY 2009
Cambodian firms that list on planned exchange will also be offered
opportunity to list in South Korea as part of agreement, says official
A KRX employee stands near a display showing the KOSPI stock index in Seoul. BLOOMBERG
Vietnam firm’s stock soars on KRX plan
HANOI – Mirae Joint-Stock Co, a Vietnamese apparel producer, saw its shares climb to an eight-month high Wednesday after it announced plans to list in South Korea in December. The shares rose 4.8 percent to 13,200 dong (US$0.74), the highest since September 23 on the Ho Chi Minh City Stock Exchange. The benchmark VN Index
was little changed at 425.17. Mirae will submit an application to the Korean Exchange in July to sell $8 million of shares, according to Dang Thanh Thu, the assistant of the company’s director. Meanhile, the KRX said it will start South Korea’s first real-time bond index on June 1 to help develop fixed-income securities market.
CAMBODIAN companies that list on the Kingdom’s forthcoming stock exchange will also have the option of listing on the Korea Exchange (KRX) in Seoul, an official from the Ministry of Economy said Wednesday.
The government is due to incorporate a joint-venture exchange company this year that will manage the Cambodian exchange, ministry Secretary General Hang Chuon Naron said Wednesday, with the possibility of a South Korean listing part of the agreement.
"They [Cambodian-listed] companies can have the option of listing in Cambodia and Korea," he told the Post, adding that the initiative would offer Cambodian companies the chance to "increase standards" of transparency and accounting in order to meet the necessary requirements to list on the Korea Exchange.
The dual-listings initiative would "encourage Koreans to diversify their stock holdings", he said.
It would also give Cambodian-listed companies access to a greater number of potential investors, Hang Chuon Naron added.
Inpyo Lee, project director of KRX, said Wednesday that company shares would be listed at the same price on the Cambodian and Korean exchanges, but converted into won, the Korean currency, on the KRX.
[The initiative would] encourage Koreans to diversify their stock holdings.
Foreign companies – particularly those from China – have typically done well on the KRX, he said, although he would not speculate on the anticipated level of demand for Cambodian stock in South Korea.
"We are not sure – it’s the first [such] case," he said.
The KOSPI – the index of all common stocks traded on the KRX – has rallied in the second quarter, climbing 29 percent to 1,372.04 on Tuesday after reaching a year low of 1,063.03 on March 2.
This year the KOSPI has gained 18.55 percent from 1,157.40 on January 2.
Listed companies still unclear
Although the Cambodian government has begun preparations to list companies on the domestic exchange – including staff training and measures to meet accounting standards – it has been unwilling to confirm which companies would make the move first.
Hang Chuon Naron would not say which companies were being considered, except to say that it would be "state-owned companies" at first – most likely three – followed by private firms later. He denied reports that Electricite de Cambodge was on the list for consideration.
Lee said that the Phnom Penh Water Supply Authority was among potential candidates to be listed.
Other officials have also said that Sihanoukville Autonomous Port was also being considered.
KRX began its involvement with the development of the Cambodian stock exchange in 2007 when it signed a memorandum of understanding with the government.
At the end of March, both sides signed a further memorandum of understanding on the establishment of the Cambodian stock exchange company – the body that will operate the new exchange – which gave the government a 55 percent stake and KRX 45 percent.