Myanmar 2016: Yangon bourse sees 3 listings, more in pipeline

Photo: Juliet Shwe Gaung.

December 2015 marked the launch of the Yangon Stock Exchange, a landmark and historic event in Myanmar, and a year from then, the bourse has seen the listing of three companies with plans lined up for more in 2017.

The number of listings at YSX are the lowest in the south-east Asian region, even compared to Cambodia Securities Exchange which sports four listed entities while Laos Stock Exchange has five. Meanwhile, the Stock Exchange of Thailand has 50 listed companies, just a fraction of the Vietnam Stock Exchange that has 663 listings.

Thet Htun Oo, executive senior manager of the Yangon Stock Exchange, is, however, enthusiastic about catching up with the neighbours.

With three companies trading currently, and three more to be allowed soon, YSX can expect the total number of listed companies to be 10 in 2017, said Oo. With the government working on amending the Company Act, it is expected that foreign investors as well as institutional investors would be allowed to trade on YSX by 2017.

“Our major aim is to expand customer base and have more listed companies as well as brokers,” said Oo.

In Myanmar, the common investment options are property, gold, dollar and bank deposits as opposed to stocks and bonds, which are not mainstream yet.

In fact, the exchange has not yet seen a single initial public offering yet as that would require a lot of capacity building and investor education exercises.

YSX has three listed companies, First Myanmar Investment Co Ltd (FMI), Myanmar Thilawa SEZ Holdings Public Ltd (MTSH) and Myanmar Citizens Bank Ltd (MCB).

 

Myanmar Stock Price Index chart. Source: YSX

Myanmar Stock Price Index chart. Source: YSX

The listed companies witnessed a spike in activity in the initial days following listing before tapering off. Consider these numbers: As of December 23, nearly 21,668 shares have been traded on the exchange, down from 210,752 shares traded on March 29. Market capitalization was K626 billion ($458 million) on December 23 compared to K962 billion ($705 million) on March 29, 2016, the week it commenced trading.

Closing price of FMI on December 23 was K15,000 which on March 29 reached a closing price at K41,000. The trading volume also saw a fall to 2,418 shares from 210,752 for the same period compared. For MCB, there has been no trading activity since December 12 on its closing price of K9500 per share. MCB reached a peak went at K12000 per share in September, the same month it got listed.

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Source: YSX

“We are optimistic about the trading volume and the customer base we have,” said Oo.

As of December 6, 2016, FMI had 1,456,000 shares traded on YSX which had a total value of K44.23 billion since the day of listing on March 25. For MTSH, the numbers of shares reached 765,000 with a total value of K24.14 billion since listing on May 20. MCB had 124,000 shares traded valued at K1.18 since the start of its listing on August 26.

YSX, a joint venture between Myanma Economic Bank, Japan Exchange Group and Daiwa Institute of Research currently allows six securities companies as underwriters. In the one year period, the number of investors has increased from 3,000 to about 24,000.

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