DBD IPO boosts engineering activities in Cambodia

DBD Engineering’s public listing on the CSX took place in September of last year. PROVIDED

DBD Engineering Plc became the first small and medium-sized enterprise (SME) to be listed on the Growth Board of the Cambodia Stock Exchange (CSX) after listing in September this year.

The CSX Growth Board was created in 2015 to help SMEs raise capital to grow their businesses.

Founded in 1995 and one of the oldest engineering and construction companies in Cambodia, DBD provides design, construction, installation and maintenance services to national and international companies.

With around 700 employees and its track record, the company is also involved in the construction of reputable shopping malls in the Kingdom.

DBD was one of the companies that benefited from the first Excellence Program of the Cambodia Securities Regulator, held in 2017, followed by the second in 2020.

The program aims to provide professional consultation to budding business entities to help them achieve sustainable business growth.

The listing exercise has brought benefits to DBD – from the injection of additional capital to an increased ability to attract talent and contribute to the national economy.

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DBD Engineering is hosting an IPO tour ahead of its listing on CSX’s second board of directors this year. PROVIDED

Seven main advantages of an IPO

Large-scale, long-term capital financing

Local businesses can raise capital from investors through an Initial Public Offering (IPO), which is a better and safer source of finance than bank loans.

Bank loans require collateral, while in an IPO exercise, a company’s assets, reputation, and income generating capacity are critical.

In addition, the company must pay interest even if it is not making a profit.

When issuing securities, the company is only obligated to pay dividends when it makes a profit.

This does not mean that businesses should not resort to bank loans, both options are good if used effectively.

Tax incentives

The government offers tax incentives to a listed company, including exemption from tax payable and reduction of income tax.

Good governance with better management

The IPO ensures that companies – even family businesses – have a standardized governance framework, with clear committee structures, one of the most necessary elements for issuing shares.

Transparency

Public listing enables financial integrity, with disclosure of financial figures and statements made transparent to protect investors.

Even business owners who are reluctant to open their books or disclose their financial statements to the public and tax authorities are required by law to do so once they are listed on the stock exchange.

Companies can face penalties or even have to go out of business if they violate the laws.

Trust and reputation

A listed company can take advantage of its public listing status to bid on major projects, as it will have established a stronger reputation and built greater confidence among investors, which will give it an edge over its competitors.

Exploit potential investors

Compared to an unlisted company of similar size, a listed company may find it easier to seek out investment partners or strategic investors.

They are more transparent, have a clear management structure, practice good governance, make financial information available and ensure the proper payment of taxes.

These factors make it easier for investors to make an investment decision.

The shares of the issuer have more liquidity than those of the non-issuer because investors can buy shares of a company already listed on the CSX – such shares of DBD Engineering – or the shares that the company will issue in addition.

Promote the national economy

Raising capital through the issuance of equity securities can also fuel a country’s economic growth through revolving capital flows through the optimal use of unused capital.

In this regard, those with less capital can also invest in the stock market rather than keeping their unused money, thus creating more employment opportunities for locals.

These are the main advantages that took DBD Engineering to the next level after the IPO.

Prepared by: DBD Engineering Email:[email protected] Phone. : +855 78 700 598

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DBD Engineering is one of the oldest engineering and construction companies in the Kingdom. PROVIDED


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