PPWSA stock to list today

Investors, along with the next two companies expected to list on the Cambodia Securities Exchange, will watch carefully this morning the action on the country’s first initial public offering, nine months after the CSX officially opened.

After a book-building process that was 17 times over-subscribed, Phnom Penh Water Supply Authority shares will sell at about a penny below the maximum bidding price originally set by the Securities and Exchange Commission of Cambodia. 

PPWSA was valued at 6,300 riel, or US$1.57, a share in late March, and 514 investors bought 474,143 shares during book-building.

Investor behaviour today would have a significant impact on the listing of Telecom Cambodiaand Sihanoukville Autonomous Port, the two state-owned companies also expected to list this year, Tong Yang Securities (Cambodia) managing director Han Kyung-tae said.

Tong Yang is the underwriter for PPWSA and Telecom Cambodia.

“Everybody is excited to see the movement of the price, and it will definitely have an impact on the other companies,” Han Kyung-tae said. 

The price today will be allowed to fluctuate upward by as much as 50 per cent, and downward by 10 per cent, although some analysts have said the price is already high for a public utility.

From tomorrow, prices will be allowed to rise or drop by five per cent in a given trading day.

Despite shares being valued at the high end of the spectrum, strong annual growth at the water monopoly and a diversified base of retail and institutional investors would allow for price increases, Han Kyung-tae said.

The Lao Securities Exchange, which launched in January last year, saw an 86 per cent increase during the first three weeks of operation, but shares in its two listed companies have since fallen by about 50 per cent.

“If the market has many speculators, the price will boom for a while, then drop sharply,”ACLEDA Securities president and managing director Svay Hay said, pointing to the Lao and Vietnamese exchanges as an example. 

“Cambodia learned a lot from those two markets and other markets in the region.”

But high demand for PPWSA shares would contribute to stable trading and reasonable price fluctuations, Svay Hay said. 

With a $1.57 share price and expec-ted 2012 earnings of $0.08 a share, the stock would trade at an 18.7 price-to-earnings ratio – a sizeable jump over comparable companies researched by SBI Royal Securities in March.

A trial run incorporating all elements of the CSX system had not yet been carried out, a source close to the bourse, who did not have authority to talk to the media, said yesterday. 

Although no technical errors are anticipated, the lack of testing has generated some unease among brokers. 

“There’s a lot of things that haven’t been tried out yet. When trading starts tomorrow, the system has not been completely tested. Anything could happen.”

A previous version of this story incorrectly stated that Electricite du Cambodge was slated for an IPO this year. In fact, it was Sihanoukville Autonomous Port.

Cambodia’s Song Saa Islands: An Isolated Eden

A few nautical miles from the scabrous Cambodian port of Sihanoukville lies a little pair of islands known in Khmer as Song Saa, “the sweethearts.” Among the 60 islands of Cambodia’s secretive coastline, they are, as brochures put it, lost. No one would know they were there were it not for the motor launch that leaves in the afternoons from the Sihanoukville port laden with the odd solitary millionaire in a linen hat and Prada espadrilles.

The sweethearts are uninhabited. They are Koh Ouen and Koh Bong, now occupied by a single “resort”—though the word seems over-hustled for a place that remains quietly separated from a coast that war and civil war have preserved in a state of beautiful ruin. A place made beautiful, if you like, by failure.

When I was living in Phnom Penh, I used to come to Kep, the old French provincial capital further along the same coast. The islands have much the same aesthetic: the French houses standing in isolate and magnificent desperation, the mangroves and narrow beaches and slopes of rainforest bristling with cashew trees. Ravaged by the Khmer Rouge, Kep had not yet recovered. But its charm was invested in a slow-burning decay, which expressed its isolation from an outside world that could never—in its imagination—separate Cambodia from her genocide and her unwilling role in the Vietnam War. While Thailand rushed to despoil her islands, Cambodia was left to abandon hers.

Pol Pot had the Cambodian islands evacuated in 1977. For a time they were home to Khmer Rouge fighters and no one else. On Koh Rong, a larger island next to Song Saa, with its rainforests the size of Hong Kong, they set up their base camps and gun emplacements. (In an obscure incident of that time, 25 American Marines were killed in an ill-timed island fire-fight.) But history moved on. The fishing families returned, and 30 years later an Australian couple, Melita and Rory Hunter, stumbled upon the sweethearts, like a vision—if you’ll forgive the cliché—from the movie Castaway.

The Hunters had founded a company called Brocon, which pioneered the renovation of French colonial buildings in Phnom Penh. Brocon set out to create an island resort that would, like its developments in Phnom Penh, hold together the fragile texture of Khmer society. For one thing, they nobly decided to create a marine reserve inside which the locals were no longer permitted to fish by dropping cyanide into the water to stun their prey. But what did the Western rich really want when they ventured down to the seascapes of a country like Cambodia? What were they looking to escape from, and what did they want to intrude into?

The Perfect 100 Travel Spots

The oceanfront villas in splendid solitude., Sunya Thadathanawong

Americans know the Tom Hanks film version of Castaway, made by Robert Zemeckis in 2000 (alas, because the earlier, Nicolas Roeg version is far better). The original novel, however, was published by a young Englishwoman named Lucy Irvine in 1983. The 25-year-old Irvine had answered an ad in a London paper placed by a middle-aged adventurer named Gerald Kingsland asking for a “companion” to go live with him on a deserted island in East Asia. Kingsland and Irvine spent a difficult year together on the island of Tuin in New Guinea. It was the Crusoe fantasy with a sexual edge. The human couple forced together by their isolation, by the material magic of a tropical island from which there was no easy escape. It is, on rereading, a beautiful and haunting book, and it holds the clue to a peculiarly contemporary longing: a yearning for a temporary but primitive solitude defined by the sea. That, and a much-needed simplification of sex.

There have been so many versions of this myth—Swept Away is another—that one wonders if industrial society’s unhappiness is leading it to search further afield for a release that now has to be contrived with the aid of technology. The original title of Lina Wertmüller’s 1974 original was Swept Away by an Unusual Destiny in the Blue Sea of August. Here, the paradise island was a rougher place that stripped men and women down to their biological roots. Yet all the time I was on Song Saa I thought of those Wertmüller landscapes. The rocks, the deceptive waves, the somnolent forests, and a subtle strangeness—a kind of species memory—emanating from them. Islands represent something mysterious to us because they offer the hope that we can be human in our original Eden, but without other humans. We know that this is neither true nor possible but, wonderfully enough, we are poetically indifferent to our own realism.

Technology comes to the classroom

Tucked away behind a high wall on Mao Tse Tung Boulevard is a collection of brash red, white and blue buildings, home to one of the most recent additions to Phnom Penh’s English-language schools, the American Education Center. 

The Director of the AEC, the aptly named Janet English, says what the school offers its students is different from most schools. 

AEC DIRECTOR JANET ENGLISH

“The AEC was set up to do something different from the traditional language teaching. We’re computer based, using technology, and then the students go into the classroom and do activities based on what they’re learning on the computer, using the same language structures. So we have no textbooks, although some students wish they had them,” she says.  

Originally from Edmonton, in the west of Canada, English says the opportunity to work in Cambodia was too good to miss. “I spent nine years in China, all over, the last four years in Beijing. But I felt I’d been in China for a long time, and Cambodia presented a lot of opportunities. This school was opening and looking for someone experienced to run it, and I had the background as a director of studies. And I’m very much enjoying being here.” 

The focus of the school’s teaching is less on academic achievement, and more on communication. “We have different programs, hospitality English programs, and we do a writing program. Our basic set-up is that we try to teach listening and speaking first, the same way we all learn our first language.” However English stresses that the teaching is as rigorous as possible, and of an international standard: “If somebody goes through and gets through to the advanced level, they should have no problem passing their IELTS (International English Language Testing System), their test of English language proficiency.” 

All of AEC’s teachers are foreign, except for at a very basic level, where they use Khmer, and the school goes to a great deal of trouble to pick the right staff. “We like to find teachers that are fairly stable and set up here. We’re very selective about who we hire, so that can present difficulties, but we do have very good teachers.” 

While the school’s innovative use of technology is different from other establishments, it is proving popular in Cambodia. “We’ve been open about nine months. We now have about 300 students. It’s growing. It takes time. We take students from 10 years old all the way up: we’ve even got some students who are in their fifties.”

Is she optimistic about the educational future in Cambodia? “Oh yes,” she replies. “People are hungry to learn. We have students here who’ve just enrolled for their fourth term, they’re realising that they can speak easily now, and their listening is much better when they’re talking to foreigners, and they’re very enthused by that.” 

English would eventually love to roll out the AEC concept across the kingdom. “I’d love to see us do that, not least because I’d love to travel to places like Siem Reap and Battambang, and live there for a while, but I think it’ll probably take us a while to get a really firm base here. But we can do sessions using Skype, for students from around the country, which works out really well, and we’ve got some really enthusiastic students.”