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27/06: Daily updates of the Lao Securities Exchange
1. Executive Summary
The Lao Securities Exchange
Stock trading emanated as slowly as it has been lately, until BCEL cascaded 310K shares onto the leisurely market. Who would have thought that the LSX would be overwhelmed with such a bargaining thrill right at the dawn of a new week? The public bank paced quickly to the 8,400 Kip by the end of first session, but encountered a critical resistance right after. By the end of the second session, the bank receded to 8,000 Kip (-0.62%) with a searing turnover of LAK 2,598 million. On the other side, EDL-Gen kept nailing down its 5,200 Kip with an extra 51K shares; roughly LAK 263 million was generated for the electricity company today.
284km transmission line powers up the central of Laos
Electricite du Laos (EDL) has commenced operation of the Pakxon-Pakbo 155 kV transmission project after two and half years of construction. EDL is the owner of the US$45 million project, while the contractors are Consortium of Corporation and J-Power System Corporation. Almost US$40 million of the project was funded by a Japanese Official Development Assistance loan with an annual interest rate of 0.9% and a period of 30 years, including a grace period of 10 years. EDL's contribution was US$5 million.
Telecom giant makes beeline for Lao market
VimpelCom Ltd, a leading international provider of telecommunications services, officially enters the Lao telecom market by investing in Millicom Lao Co Ltd. The company holds 78 percent of the 361 billion kip investment, and the Lao government owns the remaining 22 percent. Millicom Lao Co Ltd has officially changed its name to VimpelCom Lao Co Ltd since last Wednesday. The company will maintain its current structure under its popular TIGO brand.
The Lao Securities Exchange
The Lao stock market BCEL was thrown into a trading spiral made of foreign buying, and got wound up almost to its ceiling price. Skeptics might have considered those large transactions a predetermined placement between private entities due to the massive amount and perfect timing. The inexplicable burst of demand should not be seen as a price manipulating attempt, because the bank fell miserably right after the soar. Whether it was a one-time deal or a long-lasting offer, there are willing buyers out there for the public bank should the suppliers jump the gun. The electricity company grew more attached to the 5,200 Kip as the foreign investors hoard in its shares. Today was the fifth time EDL-Gen closed unchanged. However, demand is stabilizing and supply is responding accordingly. The most important aspect of the Lao securities market is maintaining liquidity, and the aridity problem seemed to have solved itself.
The LSX Index 1,083.92 -1.32 [-0.12%]
The liquidity drawdown has finally reached the reinforcement from the public bank, charging up to 360K shares from the last Friday’s 25K shares. Market’s turnover pierced through the LAK 2,861 million from the previous LAK 136 million. Nevertheless, the Lao index still had to endure a 12 bps loss and is now residing at the 1,084.
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