Prominent telecoms operator CAMGSM Plc, a subsidiary of locally-owned conglomerate Royal Group of Companies Ltd that trades as Cellcard, plans to raise about $20 million through an initial public offering (IPO) on the Cambodia Securities Exchange (CSX), expected in May.
The CSX announced on March 29 that it had granted approval in principle for the stock offering following a listing eligibility review, putting it on track to be the ninth company featured on the local bourse’s Main Board – behind the current seven as well as education firm Mengly J Quach Education Plc (MJQE), which is also set to go public soon.
Senior officers of the CSX and Securities and Exchange Regulator of Cambodia (SERC) believe Cellcard’s IPO will propel a visible uptick in public investors into the burgeoning stock market, which they say has become a “vibrant” new source of financing for companies.
CSX CEO Hong Sok Hour told The Post on March 30 that companies tend to raise from $10-20 million from IPOs, and that Cellcard is set to match the upper end of that range.
“According to rough estimates, Cellcard will be worth more than $1 billion,” he said, adding that this is evidence of the CSX’s attractiveness to small and large businesses alike.
“I expect the company to be ready for a successful IPO and to be listed on our market in May,” he said, noting that a final decision from the SERC is pending.
SERC director-general Sou Socheat told The Post on March 30 that the regulator is reviewing Cellcard’s paperwork, and will only authorise the IPO after a decision is made at a meeting of the Non-Banking Financial Services Authority (NBFSA) – its parent agency – which is scheduled to be held “soon”.
“I see CAMGSM’s involvement in the Cambodian stock market as great impetus for us to grow,” he said, admitting to be a firm believer that the number of companies listed on the CSX is indicative of the Kingdom’s economic potential in the international context.
“This is what will attract foreign investors into the country, having a large economy that allows them to turn a profit in our country,” he added.
Much like ACLEDA Bank Plc has done for many years, Socheat opined that Cellcard’s involvement will stimulate trading on the CSX.
Established in 1996, Cellcard reportedly has 52 retail outlets, 2,900 dealers and some 3,000 cell sites nationwide.
Meanwhile, in its “CSX 2022 Achievements, Outlook, and Plans for 2023” bulletin, the local bourse revealed a number of targets for this year, such as doubling the number of new securities listings to 14 and the average daily trading value to $1 million, the latter of which would make for a third consecutive year of record highs.
The stock exchange also aims to triple the number of new trading accounts this year, the bulletin said.
A total of 18 corporate securities feature on the local exchange – nine stocks and nine bonds. Companies have raised a total of $317 million through their offerings on the CSX, according to Sok Hour.
As of January 19, around 36,000 CSX trading accounts have been opened, he said, confirming that the average daily trading value on the bourse reached about $500,000 last year.
The CSX is co-owned by the finance ministry and the Korea Exchange (KRX) on a 55:45 basis.