Trading volumes of Yangon Stock Exchange listed companies doubled last week

The Myanmar Stock Price Index closed last Friday at 462.41, down by more than 2 percent since trading resumed in the New Year. Nevertheless, trading volumes doubled during the week, with almost 22,000 shares exchanging hands on Friday compared to just over 11,000 at the start of the week. A total of 43,524 shares were traded over the three-day week.

Myanmar Thilawa SEZ Holdings (MTSH) accounted for the bulk of the trading last week, after the company released its results for the six months to September 30, 2017 on December 29, the last working day of 2017. 

MTSH announced revenues amounting to K8.1 billion, which is up 36 percent compared to the same period in the previous year, owing mainly to an increase in property and infrastructure development activities in Zone A of the Thilawa industrial zone by subsidiary Thilawa Property Development (TPD). During the period, TPD completed the construction of three workers’ quarters, which it is now leasing out to companies at Thilawa. It also completed two four-storey shop house blocks, some of which have been sold. 

Despite higher revenue, earnings were down 43pc year-on-year, to K6.2 billion, due to a lower share of profits from MTSH’s other investments. 

Investors are looking at more growth potential ahead, though. This will come from the development of Phase 1, Zone B of the Special Economic Zone. MTSH management said it is confident of achieving stronger growth from the sales of industrial plots across the 100 hectare area in the coming quarters. Meanwhile, additional revenues can be expected from TPD, which recently signed on a new contract to extend a factory in Thilawa, to be complete in March.

Shares of MTSH closed last Friday unchanged at K3,000 each, giving it a market value of K116 billion. Even though MTSH holds 41pc of Thilawa SEZ, Myanmar’s first fully functional SEZ the stock presents good value as it currently trades at just 5.8 times earnings and has a dividend yield of 8.3pc, Scott Osheroff, regional research analyst at Asia Frontier Capital, told The Myanmar Times last month. 

FMI extends agreement

First Myanmar Investments Co (FMI), the company controlled by Mr Serge Pun, closed Friday at K12,000 each after opening at K12,500. Last Thursday, Memories Group, the first Myanmar tourism play in which FMI has a 13.6pc stake, debuted on the Singapore Exchange at 25 Singapore cents each. The shares closed Friday at 37 Singapore cents, up 48pc within their first day of trading. 

The listing of Memories Group took place via the reverse takeover of SHC Capital Asia, a Singapore-listed investment holding company which acquired FMI’s 15.8pc stake in the tourism in November.

Separately, FMI recently said it is still working to obtain approvals to acquire a 30pc stake in Asia Golden Glory Development Co, which is involved in developing the Yeni Industrial Town Project. Finalisation of the agreement had originally been targeted for December 31, 2017. It will now take a few more months to complete.

The Yeni project, which will occupy around 1,900 acres in Yedashe township, in northern Bago Region, will involve the development of an industrial zone designed to accommodate industries such as textiles and garments, paper and pulp, printing and packaging, food and beverage and warehousing.

Banks trade sideways

However, shares of the other two YSX-listed companies were hardly traded even after the two banks announced their financial results on December 29. For the six months to September 30, 2017, Myanmar Citizens Bank (MCB) announced a 6.9pc drop in net interest income to K4 billion and a 34pc drop in fund and non-fund based fee income to K1.6 billion during the period. 

Meanwhile, the company also incurred higher operating expenses from branch renovations and as it embarked on a corporate rebranding exercise to enhance its visibility and identity in the country. As a result, profit before tax was down by more than 66pc during the period, to K1.4 billion. 

Following a Central Bank directive placing a cap on the non-performing loans of banks, growth in deposits and loans of K33.1 billion and K25 billion were substantially lower than the year before.

The other YSX-listed bank, First Private Bank (FPB), fared slightly better. FPB announced a 12.9pc increase in net interest income amounting to K3.8 billion. It also announced a rise in operating income due to a spike of 17.2pc in loans and overdrafts. As a whole, net income rose slightly to K4 billion during the period.

(The Myanmar Times: https://www.mmtimes.com/news/trading-ysx-listed-companies-gains-momentum.html )

​