Cambodia Investment Review
DBD Engineering (CSX Growth Board: DBDE) a Mechanical, Electrical, and Plumbing contractor in Cambodia, posted its annual report for the financial year ended 31 December 2022. The company reported a decrease in total revenue to approximately $14.42 million down 19.93% compared to the previous year. This resulted in a loss of around $1.57 million and a decrease in total assets by 8.70% compared to 2021.
According to the company’s annual report, the Cambodian real estate market experienced challenges in 2022, with construction projects and capital investment declining. According to the Ministry of Land Management, Urban Planning and Construction’s Annual Report 2022, construction data shows that there were 4,276 projects nationwide, with an estimated capital investment of $2.97 billion decreased by 44% compared to 2021 that had 4,303 projects with the estimated capital investment of $5.33 billion.
This downturn impacted DBD Engineering, as the company’s primary source of revenue comes from construction projects and maintenance services.
A decline in the Cambodian real estate market
To adapt to the current market conditions, DBD Engineering has outlined key strategies for future growth. Among these are increasing their market share in the MEP contracting sector, improving visibility and credibility by going public, and investing more in marketing for long-term growth. Additionally, the company plans to expand its ducting production, aiming to supply not only their own construction projects but also other contractors in Cambodia.
Read more: DBD Engineering makes profit of $388K in 2021
DBD’s shares are currently trading at around $0.58 (KHR 2,370), down from approximately $0.59 (KHR 2,380) during its IPO. The company guarantees a 5.5% minimum dividend for the first three years for all IPO buyers, equivalent to around $0.03 (KHR 131) per share or a total payout of $208,000.
The downturn in the Cambodian real estate market can be attributed to several factors, including a slowdown in economic growth, tighter lending regulations, and a shift in consumer preferences. Despite these challenges, there are still opportunities for growth in the market. Cambodia’s growing urban population and increasing demand for affordable housing and commercial spaces present opportunities for DBD Engineering to capitalize on.
DBD: Committed to current market situation
As a pioneer in listing on the Cambodia Securities Exchange growth board, DBD’s journey serves as an example for other small and medium-sized enterprises (SMEs) looking to raise capital in the Cambodian real estate market. The company successfully raised $3.88 million through the sale of 6,461,538 shares at around $0.59 (KHR 2,380) each during its IPO, highlighting the potential for other SMEs to access funding through the stock market. The stock is currently trading at $0.58 (KHT 2,370)
Read more: Cambodia Real Estate Survey 2023 – What Is The Market Sentiment
Chairman Neangvithy, has stated, “We are committed to overcoming the obstacles presented by the current market situation in the Cambodian real estate sector. Our focus on innovation and maintaining our reputation for delivering high-quality projects will be essential to our growth in the coming years.”
DBD Engineering’s proactive approach to tackling market challenges, combined with its strategic plans for growth, suggests a promising future for the company. By expanding its services and production capabilities, DBD aims to create new revenue streams that will contribute to the company’s overall growth in the Cambodian real estate market.
