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More foreigners buying EDL Gen shares
More foreign investors have invested in Lao stocks after the government relaxed a regulation restricting foreign ownership of shares in Lao companies.
Brokers from BCEL-Krung Thai Securities (BCEL-KT) and Lane Xang Securities said on Wednesday they saw an increase in the number of foreign investors buying shares in EDL Generation, the only public company on the Lao Securities Exchange (LSX) in which the government allows foreign investment.
The increase in foreign investment comes after the Lao government last month agreed to allow individual foreign investors to hold more than three percent of EDL Generation's stock. However, they will not be able to exercise the rights normally associated with such an increase in shareholdings.
BCEL-KT Public Co Ltd Deputy Director, Mr Hinphet Chanthanlangsy, said most of the foreign investors using his company's brokering service to buy the shares on the LSX were from Thailand.
Chinese, Japanese and Vietnamese investors are also among the top buyers, he told Vientiane Times , adding that foreign investors are confident about their purchase as they believe EDL Generation has a bright future.
“In the eyes of foreign investors, EDL Generation is an attractive option as they believe electricity consumption will continue to increase as the economy grows,” he said, pointing out that electricity is a basic necessity.
“People will continue to consume energy whatever the economic situation.”
He also said buyers of EDL Generation shares not only expected the company to grow but also expected the Lao macro economy to remain stable – one of the main factors influencing the price of shares.BCEL-Krung Thai Securities is a joint venture between Banque pour le Commerce Exterieur Lao (BCEL) and KT Zmico of Thailand. The company provided the consulting and underwriting service for Electricite du Laos (EDL) to list on the stock market.
A Lane Xang Securities official said most of the foreign investors who posted orders through the company to buy EDL Generation shares were Vietnamese, Japanese, Chinese, German, British, Swedish and Belgian.
Lane Xang Securities is a joint venture between the Lao Development Bank and Sacombank Securities of Vietnam. The company provided consulting and underwriting services for BCEL, a previously wholly state-owned Lao bank, to list on the stock market.
Both BCEL-KT and Lane Xang Securities said that by far the greatest number of investors in the LSX were Lao nationals as the government had placed no restrictions on their trading in BCEL and EDL Generation shares.
BCEL-KT officials said Lao nationals had bought more shares in BCEL than in EDL Generation as they believed the bank held large reserves, while EDL Generation was exposed to high operating costs which could adversely affect profits.
vientiane times
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