On June 16, Grand Twins International PLC, a Taiwan-based garment company, joined the Phnom Penh Water Supply Authority on the Cambodia Securities Exchange (CSX) to become only the second company—and first privately-owned company—to list since the CSX opened in 2011. Grand Twins originally expected to list on the CSX in May. Delays, however, pushed that date back to June 16.
Many had hoped that the Grand Twins listing would help stimulate the largely moribund securities market. However, on the first day of trading Grand Twins shares dropped about 5% from its opening price of $2.40 to $2.28 per share. This could be due to a lack of confidence rising from the recent unrest in the garment industry. However, Stephen Hsu, Chief Executive of Phnom Penh Securities was more optimistic according to a recent Wall Street Journal article: “This can be turned around . . . . Technical issues, such as a lack of liquidity and gaps in securities regulations, need time to be resolved.” Despite this optimism in the days since listing, Grand Twins stock price has continued to drop and is trading at around $2.17 as of today.
Despite the somewhat lackluster opening days for the Grand Twins listing and the thin trading in Phnom Penh Water Supply, another Taiwanese-owned garment company and additional state-owned companies are considering beginning the process of listing on the CSX. Further listings are sorely needed to build the CSX. Despite this slow start to the stock exchange, Cambodia remains an attractive investment destination. If your company is considering investing in Cambodia, our newly-updated Guide to Doing Business in Cambodia provides a good overview of the legal and regulatory environment here.