Market index soars, as year-end draws closer

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Author: CSX

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Posted on 14-Dec-2018

CSX market’s index today closed at 416.30 points, 22.36% increase compared to the beginning of the year, based on the statistics of Cambodia Securities Exchange (CSX).

For the first eight months, CSX Index – a figure representing the price movement of all the listed stocks in the market – remained below 350 points at an average of around 334 points. As illustrated in the graph, it was not until around the end of the third quarter that the index price took an upward turn and rapidly grew to today’s closing point, the year’s highest thus far. It is also worth to point out that right before the index closed, the price reached today’s highest at 421.42 points.

The price uptrend since the end of Q3 might be driven mainly by three reasons as follows:

1. Growth in the number of trading accounts: the number of trading accounts in the market grew doubled from roughly 9,891 accounts to over 20,000 accounts, between July and November. The existence of new investors surely creates more demand, especially for the stocks with high performance and attractive profits, as investors tend to buy in during the early period of account openings.

2. Good businesses performance of the listed companies: Most of the listed stocks have shown an attractive profit and dividend yield especially stocks of the two ports, Sihanouk Ville Port – PAS and Phnom Penh Autonomous Port – PPAP, which had contributed largely to the index uptrend. In July 2018, PAS announced a relatively high dividend yield of 7.90% for 2017, compared to around 4% - 5% for the whole market. Meanwhile, PPAP stock also showed a 59.98% increase in net profit in Q3 compared to the same quarter of the previous year. These disclosures might have attracted new investors to buy in and thus moving their prices up.

3. IR and information dissemination: CSX, along with related institutions, has been working to attract both local and international investors through conducting seminars and direct discussion with investors both in and outside the country to showcase the potentials that this fledging market has to offer.

In overall, these positive signs could mark a new era for Cambodia’s stock exchange to continue attracting more interest from the public to invest in the CSX.