Main steps under process for foreigner YSX participation

Foreign visitors seen at Yangon Stock Exchange in downtown Yangon. Photo: Phoe Khwar
Foreign visitors seen at Yangon Stock Exchange in downtown Yangon. Photo: Phoe Khwar

According to Myanmar Companies Law 2017, foreigners are allowed to invest up to 35% of stocks in local companies. There are three main steps needed in order to implement the foreigner participation scheme, said U Thet Htun Oo, executive senior manager of YSX.
“First, Securities Exchange Commission will release regulations and guidelines for foreigner participation in Yangon Stock Exchange (YSX) stocks, in accordance with the new companies law, which will come out soon. Second, YSX and Securities Companies will draw
up procedures and systems how to control daily foreigners abiding the rules and regulations. These procedures are being developed. Third, all YSX-listed companies are needed to register again at the DICA office and extraordinary meetings are conducted to get approval of foreigners in their respective companies. Those three steps are still under process”, he maintained.
Those stages are likely to be finished in two months, he continued.
U Myo Min, Director of the Directorate of Investment and Company Administration (DICA) said that under Myanmar Companies Law 2017, foreigners can hold 35 per cent of stock in domestic companies. They are also able to establish foreign, owned companies controlling above 35 per cent of stock. Foreign-listed companies can also register as overseas corporations and enter the stock market. However, those businesses will be allowed only under the supervision of respective regulators of the stock market.
At present, two-year-old YSX has not seen a remarkable increase in trading. The public companies — First Myanmar Investment Co., Ltd (FMI), Myanmar Thilawa SEZ Holdings Public Ltd (MTSH), Myanmar Citizens Bank Ltd (MCB), First Private Bank Ltd (FPB) and TMH Telecom Public Co., Ltd (TMH) are currently trading shares.
Last March, YSX increased trading matching time from two to four per day. Nevertheless, there is no significant increase in trade value.
“The stock trading volume slightly increased after the event of a double stock matching time and launch of online trading, up by 10 to 20 per cent”, said U Thet Htun Oo.
According to monthly trading data of the YSX, stock trading value has declined this year, compared to the previous years. This year, June’s trading value hit all-time record low in its history. However, July trading value reached the highest record this year, as the stock trading remarkably rose after five listed companies announced their share dividends, annual reports and closing date (record date) for trading to receive dividends.
The value of traded stocks on the YSX last month hit a record-high in 2018 at Ks1.23 billion, with trading volume of 286,328 shares.
Investors in the Yangon Stock Exchange mainly concentrate on share dividends payment of the companies, rather than earn capital gains from stock market trading.

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