Yangon Stock Exchange needs more time to succeed, experts say

THERE IS a long way to go for the Yangon Stock Exchange (YSX), which opened for trading late March, to achieve success and sustainability, capital market experts said at a panel discussion during the Myanmar Business Leaders’ Inaugural Summit last week,

Aung Htun, managing director of Myanmar Investments International, an investment holding company listed on the London Stock Exchange that mainly focuses on making long-term investments in Myanmar, said it usually takes a long time to build a successful stock market.

“In most economies, there is a shortage of venture capital which is crucial to building an entrepreneurial culture and increasing employment. A stock exchange needs both institutional and retail investors … We need a wide range of investors,” he said.

According to Aung Htun, the government should develop a holistic master plan that identifies what Myanmar needs to build. He said the authorities needed to recognise that all the components could not start at the same time, though YSX helped a great deal to generate capital.

Myanmar was the last of the Southeast Asian countries, except for Brunei, to establish a stock exchange. Only two companies are listed – First Myanmar Investment (FMI) Co and Myanmar Thilawa SEZ Holdings. Myanmar Citizens Bank hopes to become the third listed company soon.

On the first trading day on March 25, daily transactions for FMI shares hit 42 billion kyats (Bt1.2 billion). The daily transactions exceeded 1 billion after the listing of Thilawa on May 20. On May 23, transactions hit 2.6 billion.

However, trading has slowed since May 30: the number of shares transacted daily fell to 4,000-5,000 shares for each stock, from the normal five-digit figure.

Ye Min Aung, managing director of Myanmar Agribusiness, which will list its shares later this year, said YSX was still at an early stage of development. He revealed that a lot of Singaporean companies were interested in listing on the YSX, but the regulatory framework is not yet ready.

 

Source: Myanmar Eleven

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