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11/03: Daily updates of the Lao Securities Exchange
BCEL was just drowning in the anxiety of investors. This stock has lost 13% of its market value since the beginning of the week while investors prefer to invest in EDL-Gen for its better liquidity, signaling a good chance that this stock should be able to sustain its current market price.
1. Executive Summary
- The Lao Securities Exchange: EDL-Gen replicated the yesterday sessions with only one exception: the 77% increase in trades. EDL-Gen paved its way to the 6,750 Kip per share then slid back to where it started: 6,700 Kip per share. Without a guiding light, BCEL just drifted further to 9,250 Kip per share, leaving only 40% of the yesterday turnover: 117 million Kip. A total of 1.11 million shares were traded during the 9th week of the LSX, of which 93% of the transactions belonged to EDL-Gen. Total market turnover over the week reached 7.73 billion Kip (~0.96 mil. US$), equivalent to a 39% downswing compared to last week.
- Laos exceeds five-year ODA target: The Lao government has been the recipient of official development assistance (ODA) worth US$2.442 billion over the past five years (2006-2010), exceeding the five-year target set at US$1.75 billion. The ODA was provided by some 52 different donors. The achievement in mobilizing aid was attributed to several reasons including the fact that the government has attached great importance to aid mobilization and effectiveness while continuing to improve coordination mechanisms among stakeholders.
- Government considers fuel subsidy: The Lao government may provide fuel subsidies if the price of oil in world markets continues to rise. The ministry had already issued a proposal to the cabinet considering fuel subsidies as one way to stabilize the price of fuel. Rising fuel prices have the government considering a subsidy. The government would expect to lose more than 70 billion kip a month through fuel subsidies.
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2. The Lao Securities Exchange
The Lao stock market
BCEL was just drowning in the anxiety of investors. This stock has lost 13% of its market value since the beginning of the week. There were simply so demands to power up the BCEL ‘submarine.’ Traders just want to get out before the ship sinks too deep. However, BCEL is getting back to the level of the first trading day, presenting a golden opportunity for those who did not participate in the IPO auction. Apparently, investors prefer to invest in EDL-Gen for its better liquidity, signaling a good chance that this stock should be able to sustain its current market price. EDL-Gen enjoyed 93% increase in demands despite of the unchanged price. However, large supplies are still waiting EDL-Gen at the 6,750 and 6,800 Kip per share.
The LSX Index 1,368.68 -11.88 [-0.86%]
The tottery Lao Composite Index inclined toward the BCEL side as this leg can no longer support even its own weight. The current benchmark is now hinging around the 1,368 index points, equivalent to a loss of 86 basis points compared to yesterday. The market was 53% more liquid as total trades reached 260 thousand shares, pulling the market turnover up by 45% to 1.7 billion Kip.
lanexang securities
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