Logo of Phnom Penh Post newspaper Phnom Penh Post - Sustain business longevity through launching an initial public offering

Sustain business longevity through launching an initial public offering

Content image - Phnom Penh Post
The official listing of JS Land Plc on CSX’s secondary board on February 10. SUPPLIED

Sustain business longevity through launching an initial public offering

There can be many reasons for the shortened life of a company.

Some collapse when they can no longer source enough funding to expand or support their business.

Some can be overly dependent on the owner – even one with a great business mind – and lack new ideas and strategies from other experienced businesspeople, while others can struggle to attract high quality human resources.

Such problems get harder to deal with when a business expands to compete in a tough environment.

To cope with such challenges, one viable option is to go for an initial public offering (IPO).

Exposure to new funding sources

Companies can access new sources of funding through an IPO.

Funds are normally raised through relatives, friends, banks, private investors or private equity funds. However, this may only provide just enough funds for the early expansion of the business.

To grow more and compete in a competitive market as the company gets bigger, getting money from the public may be the only possible way.

That’s where IPOs come into play.

Companies that have been through an IPO and listed on the stock exchange can have the option of raising money from the public not only once.

They can do this many times through additional offerings as long as their business continues to show great results and can convince investors.

Strong corporate governance

Strong corporate governance is one of the qualities of a listed company.

By having a proper board of directors and relevant committees, companies can decide on issues in a more sophisticated way, rather than by making decisions based on one person’s opinion.

Content image - Phnom Penh Post

Strong corporate governance will also help the company attract more investors, promote accountability and mitigate risks, as well as ensure the compliance and corporate efficiency of the business.

By listing on the stock exchange, companies are required to have effective corporate governance that is compliant with a strong set of rules and regulations from the authorities.

With this, every move the company makes will be based on the firm’s best interests to ensure its longevity.

Woo strategic investors

In addition to having a reliable structure and trusted corporate governance, a listed company will be more attractive to strategic shareholders than one that is private.

Having an edge by being transparent and financially sound, strategic investors, usually other companies with greater experience in a comparable sector, will be likely to invest in the business.

These investors will use their experience and expertise to improve the company so it will be able to keep pace with the competition, as well as be able to dominate the market resulting from this expertise and improved technology.

Attract quality human resources

High quality human resources are crucial to a company moving forward.

A successful company is one that not only has strong management and strategies in place, but is also able to attract more highly qualified employees.

While some private companies aren’t attractive enough to do that, listed companies don’t usually struggle to get strong human resources.

A listed company is usually more financially stable and equipped with a strong structure making it a very attractive environment for employees.

Listed companies can potentially retain staff longer than non-listed companies with an employee share scheme allowing the employee to be part of the firm they work for.

With this ability to attract and retain highly qualified staff, a company will become more stable and operate in more effective and innovative ways.

Establishing and growing a company shouldn’t be based only on short-term financial benefits.

Business owners should also pay greater attention to the longevity of the company – and by going for IPOs, companies will be better equipped with improved management structure, strategic partners and highly qualified human resources, as well as access to funding.

Launching an IPO isn’t just a choice, but a necessity for a company should it aim to exist and dominate the market for a long period of time.

Contributed by: The Cambodia Securities Exchange, Listing and Disclosure Department.
Email: [email protected]
Tel: 023 95 88 88 023 95 88 85

The Cambodia Securities Exchange is the first securities market in the Kingdom.

Disclaimer: This article has been compiled solely for informative and educational purposes. It is not intended to offer any recommendations or act as investment advice. The Cambodia Securities Exchange is not liable for any losses or damages caused by using it in such a way.


  • Ice cream, noodles flagged over carcinogen

    The General Department of Customs and Excise of Cambodia (GDCE) has identified three types of instant noodles and ice cream trademarks originating from Thailand, Vietnam and France that are suspected to contain ethylene oxide, which poses a cancer risk to consumers. The general department has

  • Angkor lifetime pass, special Siem Reap travel offers planned

    The Ministry of Tourism plans to introduce a convenient, single lifetime pass for foreign travellers to visit Angkor Archaeological Park and potentially other areas. The move is designed to stimulate tourism to the culturally rich province of Siem Reap as the start of the “Visit

  • Exclusive interview with Josep Borrell Fontelles, High Representative of the EU

    CAMBODIA is hosting the 55th ASEAN Foreign Ministers’ Meeting (AMM) and Related Meetings this week with top officials from the US, China, and Russia and other countries in the region slated to attend and to meet with face-to-face with their counterparts on the sidelines. In

  • Rise in Thai air routes to Siem Reap fuels travel hopes

    Local tourism industry players are eager for regional airline Bangkok Airways Pcl’s resumption of direct flight services between the Thai capital and Siem Reap town on August 1 – home of Cambodia’s awe-inspiring Angkor Archaeological Park – which is expected to boost the growth rate of

  • ASEAN Foreign Ministers’ meet commences, Taiwan issue possibly on table

    The 55th ASEAN Foreign Ministers’ Meeting (AMM) and related meetings hosted by Cambodia kicks off in Phnom Penh on August 3, with progress, challenges, and the way forward for the ASEAN Community-building on the table. Issues on Taiwan, sparked by the visit of US House Speaker

  • Recap of this year’s ASEAN FM meet and look ahead

    This year’s edition of the ASEAN Foreign Ministers’ Meeting (AMM) hosted by Cambodia comes against the backdrop of heightened global tensions and increasing rivalry between major powers that have been compared to the animosity of the Cold War era. The following is The Post’