Cambodia Weekly Market Insights – 30 June 2022

Cambodia Weekly Market Insights – 30 June 2022

Digital payment transactions rose 34.5% in 2021.

▪ The Cambodia Securities Exchange Index (“CSX-Index”) slightly decreased by 1.6% week-over-week (“W/W”) in USD-terms for the trading week ending on 24 June 2022, closing at the 492 level. The average daily trading value is about USD579,000 vs. USD461,000 for the previously reported week.

▪ The top performer was the monopoly water utility company in the capital, Phnom Penh Water Supply Authority (PWSA: 0.0% W/W). Meanwhile, the top laggards were the largest deep seaport in Cambodia, Sihanoukville Autonomous Port (PAS: -4.3% W/W), and the largest commercial bank in Cambodia by total assets, Acleda Bank (ABC: -3.7% W/W).

▪ Cambodia’s stock market capitalization is about USD1.8 billion, accounting for 7.0% of total GDP in 2021. The current market cap-to-GDP is relatively low compared to its peer countries, which implies that the Cambodian stock market is in the under-development stage and has lots of room to grow. However, the lack of supply-side, in terms of the number of listed companies and the limited liquidity in the market, continues to be the main barrier for investors domestically and internationally.

JS Land recorded net loss of USD423,000 in Q1/2022. JS Land (CSX:JSL), the latest growth board-listed real estate developer, released its Q1/2022 financial results with negative earnings of USD423,000. The net loss was mainly caused by the lack of revenue recognition despite the company managed to sell units of its flagship Garden Residence 2 development. The current sales were reflected in the increase in net assets, to which the total assets rose 20.9% to USD12.3 million. During the quarter, JSL’s contract liabilities went up 21.4% to USD1.9 million. Furthermore, the company’s profitability was also affected by the fluctuations in construction costs, the increase in professional fees for feasibility studies, and market research.

Hattha Bank accredited with BBB+ rating. Thai Tris Rating has given Cambodia-based Hattha Bank, a subsidiary of the Bank of Ayudhya Plc’s (Krungsri), a BBB+ credit rating with a stable outlook. This credit rating reflects Hattha Bank’s leading market position in Cambodia’s retail credit market, with a sufficient capital position and sound risk management. If Cambodia’s sovereign risk is not taken into account, Tris Rating noted that Hattha Bank’s credit profile would have an A- credit rating due to the bank’s strengths and its strategic positioning for Krungsri. Currently, Hattha bank has a non-performing loan ratio of 1.5% (vs. 2.4% industry average) and a capital adequacy ratio of 18.7%.

Hoa Phat Group’s market cap declines by half in the past 9 months. Vietnam’s leading steel manufacturer Hoa Phat Group (HOSE:HPG) has suffered a USD5.6 billion loss from its market capitalization since last October because of a bearish market, increasing costs, and plummeting demand in China. During the same period, HPG’s market cap decreased by more than half to around USD5.2 billion. Coking coal, which contributes to 40–45% of steel production costs, has seen prices increase by four times since the RussiaUkraine conflict. Generally, steelmakers’ profits have been affected by rising logistical costs and supply chain disruption due to the conflict. Given that China accounts for roughly 60% of global steel output, the lockdown led to declining global steel prices, along with a 5% decrease in demand in the first quarter of this year. Following the sales decrease of 16% Y/Y in April 2022, Vietnamese steel prices have dropped by six times over the past five weeks.

Hoa Phat Group to invest in two (2) infrastructure projects. Hoa Phat Group (HOSE:HPG) has proposed a development plan for two (2) large-scale infrastructure projects in Phu Yen Province (i.e., Bai Goc Seaport and Hoa Tam Industrial Park). The investment cost is estimated to be approximately USD5.2 billion, in which the projects are expected to be executed within 36 months. Upon successful completion, the two (2) projects are forecasted to contribute about USD258 million per annum to the local budget and employ at least 12,000 workers.

Digital payment transactions rose 34.5% in 2021. According to the National Bank of Cambodia (“NBC”), electronic transactions nationwide went up over a third to approximately USD102 billion in 2021, from which the number of e-wallet accounts reached more than 80% of the total population. The drastic improvement in Cambodia’s payment systems was attributable to several factors: (i) the large proportion of the young generation; (ii) access to mobile devices and the internet; (iii) the introduction of innovative digital payment services by the banks and financial institutions; and (iv) adoption of contactless payments during the pandemic. During the year, NBC’s Bakong payment system also provides convenience for interbank transactions.

Cambodia established 25 investment sub-committees nationwide. Under the sub-decree released on 20 June 2022, 25 CapitalProvincial Investment Sub-Committees (“CPISCs”) have been established to expedite the approval process of private investments. Within respective administrations, each CPISC will be able to review and approve registrations, incentives, guarantees, M&A, sales purchases, and cancellations, as well as resolve disputes related to investment projects with registered capital of less than USD5 million. The USD5- million mark was an upward adjustment from the previous limitation, where provincial sub-committees were only able to approve projects with investment capital less than USD2 million.

NBC sold nearly USD600 million in 2021. The central bank reported its sales of USD600 million to credit institutions and currency exchange through auctions in 2021 to maintain the stability of Khmer Riel. The exchange rates have been under pressure due to the decline in tourist arrivals and remittances. Through NBC’s intervention, exchange rates have been steady at around KHR4,099 per USD. By the end of 2021, Cambodia’s international reserves remained strong at around USD20.3 billion despite a slight decrease of 5.0% Y/Y. The reserves cover 8.3 months of average imports, which is higher than a three-month minimum benchmark for developing countries.


  1. Khmer Times – JS Land Q1 net loss at $423,000
  2. Khmer Times – Krungsri’s Cambodian bank given BBB+ rating
  3. VnExpress – Hoa Phat market cap halves in last 9 months
  4. The Saigon Times – Hoa Phat wants to invest big in two infrastructure projects
  5. The Phnom Penh Post – E-payment transactions up by over a third in 2021
  6. The Phnom Penh Post – 25 investment subcommittees set up
  7. The Phnom Penh Post – NBC’s USD sales $600M in 2021

Source: Forte Capital


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