Power transmission provider Pestech (Cambodia) Plc put on a roadshow on Monday in preparation for going public on the Cambodia Securities Exchange (CSX) on August 12.
Pestech Cambodia, a 100 per cent owned subsidiary of Malaysia-based Pestech International Bhd, hopes to raise approximately $3 million from the listing.
The infrastructure company was established in Cambodia in 2010 and manages, designs and installs high voltage (HV) and extra-high voltage (EHV) substations, transmission lines and power cable systems. Company chairman Lim “Paul” Pay Chuan said Cambodia’s energy consumption increased from 4,051GWh in 2013 to 12,015GWh last year at a compound annual growth rate of 19.9 per cent and demand is forecast to grow by 16 per cent to 13,981GWh this year.
He said Cambodia’s generation development plan is to increase domestic power production capacity from 1,657MW in 2015 to 4,498 MW in 2025, and the government plans to build an additional 1,750km of transmission lines by 2025, which will increase national grid coverage by 77.2 per cent to 4,017km.
“Pestech Cambodia is well positioned and primed to benefit from the growth of electricity consumption and from the government of Cambodia’s plan to develop the electricity infrastructure in the next five years,” Lim said during his roadshow presentation, which was via teleconference.
He said a CSX listing will provide an opportunity for the Cambodian public to invest in the power industry in tandem with the growth of demand in electricity in the Mekong region.
“It’s a platform to attract strategic long-term investors and partners to increase the product portfolio of Pestech Cambodia.
“[We] want to further develop Pestech Cambodia in terms of investment and asset buildup in Cambodia to serve the Indochina market,” Lim said.
CSX vice-chairman Ha Jong-weon told The Post that the Pestech IPO amounts to 5.26 per cent of total voting shares, which accounts for 3.9 million shares with an expected price of $0.76 per share. The total amount raised is expected to be approximately $3 million.
“The company has long-term plans and business strategies, including a greater market position in the power transmission and distribution segments, not only in Cambodia but also in neighbouring countries.
“Pestech is looking to expand power distribution activities by seeking strategic partners through a secondary listing on the Stock Exchange of Thailand. “Company visibility is important as it shows Pestech Cambodia has transparency and accountability to its investors,” Ha said.
CSX CEO Hong Sok Hour said Pestech Cambodia will become the 13th securities-listed company in Cambodia and the second this year to raise funds through an equity public offering. He said among the 12 securities-listed companies on the CSX, six are stock-listed and the 12 total raised around $240 million.
CSX’s market capitalisation rose to $2.57 billion at the end of June, 4.5 times higher than last year while the index also rose 12 per cent over the same period.
“This trend shows that CSX is growing even though the economy is suffering from the impact of Covid19. I encourage businesses to diversify their financing sources and not just rely on bank loans, which can become a burden or even a fatal blow to survival in times of crisis,” Sok Hour said.
Pestech opened for public subscription on July 27 and will close on August 4 while the allotment of IPO shares to successful applicants is on August 7. The company plans to officially list on CSX on August 12.