Harrison White
The Cambodian Securities Exchange (CSX) has experienced a slow start to 2023, with Q1 financial results showing declines in year-over-year trading value and volume. ACLEDA Securities emerged as the top-performing broker for the quarter, maintaining a dominant position in the market and announcing ambitious plans for the future.
The CSX Q1 2023 financial report highlighted a 55% year-over-year (YoY) drop in total trading value, falling from $27.63 million in Q1 2022 to $12.33 million in Q1 2023. Trading volume followed suit, with a 59% decrease, as shares also dropped from 13,402,060 in Q1 2022 to 5,470,178 in Q1 2023. The daily average suffered a 56% decline, settling at $0.193 million in Q1 2023.
This downtrend also extended to market capitalization, which contracted by 11% to $1.88 billion in Q1 2023, while full market capitalization shrank by 6.6% to $4.21 billion. The closing index followed a similar trajectory, decreasing by 11% to 493.21 in Q1 2023 over the same Q1’22 to Q1’23 period.
CSX has ambitious growth targets for 2023
Despite these headwinds, the CSX remains optimistic about its future. The exchange recently outlined ambitious growth targets for 2023, including doubling daily trading volumes and tripling the number of registered trading accounts. Additionally, the CSX aims to have 14 new firms list on the exchange, further expanding Cambodia’s underdeveloped capital markets. These goals align with CSX’s broader mission to increase public awareness and promote investment opportunities in the country.
Read more: CSX forecasts record growth for Cambodia’s capital markets in 2023
Kim Sophanita, CSX Director, spoke to the Cambodia Investment Review, offering her perspective on the current state of the market. She said, “This quarter, there’s a drop-in trading activity of ABC shares compared to the same quarter last year when the employee’s shares had just been released. However, in starting Q1 2023, the quarter-on-quarter index price has increased steadily till now as it’s approaching dividend distribution.”
She continued with an optimistic outlook, adding, “Many investors would keep their money to invest in the upcoming new big-name IPO of MJQE and Cellcard. While on the yearly outlook for the CSX, we are still positive on chasing our target, and we expect much larger transactions in Q3 after the giant IPO of Cellcard and the retail-based IPO of MJQE get listed.”
ACLEDA Securities wins Q1 top broker
ACLEDA Securities managed to maintain its position as the leading securities firm in Cambodia. The brokerage firm captured an impressive 85.25% of total securities trading value during Q1 2023, with investors buying and selling approximately $20.97 million through the firm. Furthermore, ACLEDA Securities added more than 1,400 new trading accounts during the quarter, reflecting its ongoing commitment to market education and promotion.
CEO Dr. Prom Visoth expressed satisfaction with the company’s performance, telling the Cambodia Investment Review, “It is a great achievement in the beginning of this year toward our strategy positioning ourselves as a market share leader in the securities market. We still continue to increase our programs and activities of promoting securities trading in this year and coming years.”
To maintain its dominance and achieve its 2023 goals, ACLEDA Securities plans to increase demand, trading volumes, and values while continuing to offer convenient services to investors. Initiatives such as investor awareness and training programs are expected to play a crucial role in achieving these objectives. The company also plans to upgrade its online trading account opening system, transitioning to an app-based interface for enhanced user experience.
Foreigners and institutions lead the way
The Q1 2023 results present a mixed picture for the CSX, with declining trading value and volume raising concerns about the health of the Cambodian securities market. However, the strong performance of ACLEDA Securities, combined with the CSX’s ambitious growth targets for the year, offers hope that the market will recover and continue to mature in the coming months.
Read more: Opinion on How Cambodia’s capital market can support sustainable investments?
With the Cambodian capital market still in its infancy, the CSX and brokerage firms like ACLEDA Securities play a critical role in fostering growth and promoting investment opportunities. As the market faces headwinds, the resilience and determination of these key players will be crucial in ensuring that Cambodia’s capital market continues to develop and thrive.
One key trend to watch in the coming quarters is the increased interest from foreign investors, who demonstrated a 366% YoY increase in turnover in Q1 2023. This shift signals a growing appetite for investment in the Cambodian market, which could help offset domestic declines and contribute to overall market growth.
Another area of focus is the rising participation of institutional investors, who experienced a 144% YoY increase in turnover. This uptick suggests that institutional investors are becoming more active in the Cambodian market, providing additional liquidity, and potentially attracting more listings and trading activity.
