On June 5, 2024, the Securities and Exchange Regulator of Cambodia (SERC), in collaboration with APM (Cambodia) Securities Co., Ltd and Asset Pro Management Co,. Ltd, co-organised a seminar on sharing the experiences of how small and medium enterprises (SMEs) in Thailand access the securities market.
Held with the support of the Cambodian Ministry of Industry, Science, Technology and Innovation (MISTI) and the Young Entrepreneurs Association of Cambodia (YEAC), the seminar was presided over by H.E. Sou Socheat, Director General of the SERC, and H.E. Hort Pheng, Under Secretary of State at MISTI.
The main purpose of the seminar was to share the experiences of how SMEs in Thailand prepare and get ready to obtain long-term financing from the securities market to expand their business and ensure its sustainable development. This seminar also highlighted the benefits of raising funds through the securities market and the requirements for SMEs to raise fund through Cambodia securities market.
“Raising funds through the securities market will enhance the excellence, prestige and sustainability of SMEs in Cambodia," remarked H.E. Sou Socheat.
He called on SMEs who are interested in raising funds through the securities market, including those who have a vision of instilling good governance standards in their companies, to contact the SERC or ask for support through MISTI or YEAC.
“We are ready for this mission to support you,” he affirmed.
“Accessing the securities market is an opportunity for SMEs to expand their business and connectivity to regional and global supply chain networks, “added H.E. Hort Pheng. "In this regard, I would like to suggest all SMEs to seize this opportunity to be more proactive in expanding production, business and services and strengthening competitiveness with efficiency, sustainability and inclusion."
Watch a short snippet from B2B Cambodia's interview with H.E. Sou Socheat on the benefits of SMEs accessing the securities market in Cambodia:
What Lessons Can Cambodian SMEs Learn From Thai SMEs On Accessing Financing On The Securities Market?
The seminar featured guest speakers from Asset Pro Management Co., Ltd. – an independent licensed financial advisor regulated under the Securities and Exchange Commission (SEC) of Thailand – who gave a short explainer on the Thai securities market and shared experiences of Thai SMEs that have been able to successfully access financing through listing.
While speaking with B2B Cambodia, Sirivipa Supantanet, Advisor to the Board of Directors of Asset Pro Management Co., Ltd., said that she believes this seminar sharing experiences from Thailand will give Cambodian SMEs a clearer picture of how they can take advantage of the opportunities available through the securities market.
“SMEs can do fundraising in terms of equities and bonds, and the capital market can also help them diversify the source of their financing,” she added.
Financing from the capital market can help them re-adjust their capital structure, and sometimes they can lower their financial costs if they can balance their financial sources from both the money market and the capital market.
What Types Of Securities Instruments Are Best Fit For SMEs In Cambodia?
In terms of what securities instruments are most relevant for SMEs, Supantanet pointed to debt instruments and convertible debenture (CD).
For SMEs, since ownership [is often] an important thing… they are normally very concerned about dilution, [so in that case] debt instruments can kick in first. After that, if the company has a very rapid growth, if the debt can be converted into equity, it will help reduce their interest payment expenses, and their debt to equity ratio might be improved.
“Besides debt, there is Convertible Debenture (CD), which is a feature of debt that has an equity feature embedded. This will be a very flexible tool that VC (venture capitalist) funders, who are major investors in startups or SMEs, can use. And the owner of SMEs can also be very happy [with this tool] because at the first stage, they still won't lose their ownership…. At the end, when the company grows, they can let the issuer convert the debt installments into the equity form, and they can adjust their debt to equity ratio as well. Their total financial costs will be reduced," she added.
This seminar was attended by senior management and technical officials of the SERC, MISTI, YEAC, SMEs, the Securities Investor Association of Cambodia, influencers in the securities sector, and other media, with a total of 80 participants.
This article was partially adapted from a supplied press release.