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17/06: Daily updates of the Lao Securities Exchange
1. Executive Summary
The Lao Securities Exchange: Most of the market’s liquidity was completely dissolved; the LSX quoted both stocks in parenthesis. In the second session, BCEL finally uprooted from the 8,150 Kip, but unfortunately for the worse; it is now priced at 8,100 Kip (-0.61%). The public bank got a stingy volume of 6K shares (-16%); its turnover had no choice but to accept the impoverishing LAK 48 million (-16%). EDL-Gen became exhaustive as the poor trades dragged on. Exactly 18K shares (-37%) were exchanged for the generation company. The declining volume also swept turnover down to LAK 94 million, equivalent to a 38% decline from yesterday.
Weekly changes: The ending index has dropped below 1,095 points, and compared to last Friday it has slid 1.51 percent. The accumulated market’s volume plunged vigorously to 164K shares (-46%), averaging at 33K shares per day. The combined market’s turnover has disintegrated quickly into a thin LAK 1,131 million (-38%) or US$ 141 thousand. Out of the two listed stocks, BCEL was the one contributed the most to total trades (57%) and turnover (67%).
ACLEDA bank sees customer numbers surge: The first Cambodia-based commercial bank to operate in Laos, ACLEDA Bank Lao Ltd, has exceeded its 2011 targets due to the increasing number of small, medium and large sized enterprises. It now has over 15,000 deposit accounts and over 12,900 families have taken out loans. The bank has disbursed loans worth over US$50.7 million since we opened for business in July 2008. ACLEDA Bank Lao had planned to start turning a profit in July this year - three years after opening. However, it started making a profit in February, five months ahead of schedule.
2. The Lao Securities Exchange
The Lao stock market
BCEL was still retaining the 8,150 Kip in the first session, but unexpected sell-offs has thrown the company off balance by the end of the second session. Two weeks of circling around would definitely drive any opportunist wild, the price alteration is an inevitable consequence. Demand almost doubled from 15K shares to 29K shares, especially those bidding for the 7,900 Kip. The supply side counteracted by subduing 6% to 29K shares; however the majority focused on the impatient 8,100 Kip. The bank’s liquidity was still low just as expected; its average volume since the beginning of June has been rounded off for 20K shares per day, meaning 100,000 shares of BCEL (approximately US$ 101 thousand) would take at least 5 days to dissolve completely. It is tough luck to attract the big traders with this kind of liquidity regardless of how good the company’s fundamentals are.
EDL-Gen was also in the struggling mode. The cheap demand has successfully provoked the weak-willed supply, which was the same situation that happened to the public bank. Demand scaled down to 62K shares (-29%) on a whim, otherwise not much has changed since yesterday because the buying forces from 5,100 Kip to 5,200 Kip were still the strongest. The supply side showed little inclination to wait; the yesterday’s 29K shares have extended to 49K shares (+72%). Subjectively, there is not yet real impetus beneath the listed stocks. It takes time to nurture an emerging market to maturity. Slow and careful developments would be necessary for the future market boom.
The LSX Index 1,094.95 -9.71 [-0.88%]
The brevity of stock gains has resulted in an index slump, from the yesterday’s 1,105 down to 1,095 (-88 bps). Total volume descended under 24K shares (-33%); market’s turnover also caught in the swirl and twisted into a mere LAK 143 million.
lanexang
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