MSE 2019 PERFORMANCE REPORT
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MSE 2019 PERFORMANCE
REPORT
OPERATIONAL HIGHLIGHTS New listing During the reporting period, MSE received 3 new listing applications – InvescoreNBFI, Most Fintec and Bodi Insurance and listed 773.7 million shares. However,Most Fintec’s shares were delisted before the IPO based on the issuer’s request.In 2019, Tumen shuvuut’JSC, ‘Ard credit NBFI’ JSC, ‘Monos khuns’ JSC and‘Invescore NBFI’ JSC successfully raised proceeds of MNT 42.4 billion frompublic.
Listing amendment-Stock split"Mandal Insurance" JSC implemented a stock split of 1:100 which results insplitting 6,243,016 common shares into total of 624,301,600 shares.Also, MSE examined the stock split requests of "Bayan-Albar" JSC and ‘DarkhanGuril Tejeel’ JSC and delivered the decision to FRC.
Other listing amendment -FPO
“Darkhan Guril Tejeel" JSC and ‘Sharyn gol’ JSC’s requests related to FPO anddebt-for-share swap were examined. “Darkhan Guril tejeel" JSC’s requestwere rejected while ‘Sharyn gol’ JSC cancelled its request.During the reporting period, MSE resolved name change requests from 3companies.
Delisting
21 issuers who failed to perform its obligations and 2 issuers - BayalagNalaikh’JSC and ‘Most Fintech’ JSC who voluntarily requested delisting weredelisted from MSE.
OPERATIONAL HIGHLIGHTSListing amendment –Reverse takeover The reverse takeover involving “Khorgo khairkhan" JSC and “Mongoldaatgal” JSC, was approved by the Financial Regulatory Commission inDecember 16, 2019.
Members of MSE
“Mongol khuvitsaa securities firm” LLC and "Domix securities firm" LLC became a member of MSE, while, “Frontier SC” LLC and “MWTS SC” LLC were removed from the MSE membership. As of the end of 2019, the number of member companies were 59.
During the reporting period, the Ministry of Finance did not issue new Government securities due to its fiscal and budget policy. However, due to repayment of MNT 56.8 billion for matured bonds, 568,515 units of Government securities were delisted.
Government securities
OPERATIONAL HIGHLIGHTS
Capital Market Open Day
In order to improve capital market knowledge of rural citizens, MSEorganized ‘Capital Markets Open Day’ event since 2017. During the reportingperiod MSE organized ‘Capital market open day’ event in 12 provinces -Uvurkhangai, Bayankhongor, Gobisumber, Dornogobi and Selenge and 30soums. Overall, around 15,000 citizens were involved in the event.
During the event, the training covered the following concepts:
• basic capital markets concepts;• participating in the stock and bond trades;• capital raising opportunities from the capital market;
In addition, the event organizers provided the most recent news andinformation about ‘Erdenes Tavan Tolgoi’ JSC’s 1072 shares and checked thebalance of the shares granted by pink and blue vouchers given during thestate privatization programs in 1991.
ACTIVITY OVERVIEW
Closed-End Funds Listing Rules
In recent years, Mongolian capital market is currently going through a rapidtransformation and an IPO boom and in 2018, we reached our historicalrecord in our equity trading turnover, the number of IPOs as well as admittedthe first securities dual-listing. In order to improve the market liquidity andexpand the stock market, we need to increase the participation ofprofessional investors in the market, and thus, we adopted the Closed-EndFunds Listing Rules on June 28, 2019. It was approved by the FRC onNovember 13, 2019.These Rules will enable investors to get provided with sound investmentmanagement
NEW RULES
MNT 859.1
2017 2018
No governmentsecurities wereissued on theprimary marketand thesecondarymarket trades ofgovernmentsecuritiesamounted to13.7% of totaltrades
IPOSecondary market trades of government securities
Secondary market trades of equity
IPO, secondary
market
TOTAL
Government
Stock
2019
As compared to thesame period of 2018,total volume of tradeincreased by 35.1% orMNT 11.5 billion.Government securitiesequates to 6.77% oftotal trades
TRADE SUMMARY
billion
MNT 244.1
IPO
TOTAL
MNT143.2TOTALTOTAL
200
400
600
800
1000
60
100
140
180
20
Government securities equates to 90.0% of total
trades
billion
billion
MNT12.2BILLION
IPO Secondary market trade
STOCK TRADES
0
50
100
150
200
250
2017 он 2018 он
TOTAL
MNT 76.4billion
TOTAL
MNT 210billion
MNT 31.4
billion
MNT 178.5billion
MNT 75.1billion
TOTAL
MNT 133.5billion
MNT 42.5
billion
MNT 91billion
2019 он
MNT 1.3billion
MNT 10 billion
MNT 5.3 billion
MNT 8.5 billion
MNT 17.2 billion
9.1%
3х
21%
15.9%
1 2 3 4
In 2019, the IPOs of “Tumen shuvuut” JSC, “Monos Foods” JSC, “Invescore NBFI” JSC and“Ard credit NBFI” JSC were oversubscribed by 9.1%, 21%, 15.9% and three times,respectively, which shows a strong market appetite.
MARKET ACTIVITY
5,000.00
6,000.00
7,000.00
8,000.00
9,000.00
10,000.00
19,500.00
20,000.00
20,500.00
21,000.00
21,500.00
22,000.00
TOP 20INDEX
MSE B
MSE A
In the reporting period, MSE Top 20 index was19978.13 points on average. Comparing tosame period of 2018, Top 20 index decreasedby 8.59% reaching 19621.86.
TOP-20 INDEX COMPOSITION IS RENEWED ONCE A EVERY YEAR AND ACCORDING TO THE RECENT REVIEW, 11 STOCKS
REMAINED AS A COMPONENT SECURITY, WHILE.“HB OIL” JSC, “JENCO TOUR BUREAU” JSC, “JINST UVS” JSC, “ITOOLS” JSC,
“LENDMN NBFI” JSC, “MONGOL BASALT” JSC, ”KHUVSGUL ALTAN DUULGA” JSC, “MANDAL INSURANCE” JSC AND“ARD
INSURANCE” JSC WERE NEWLY ADDED IN THE INDEX COMPOSITION.
HIGHEST POINT21888.16
MARKET INDICATORS
Comparing to the end of 2018, the market capitalization grew by 7.27% or MNT 182.2billion and reached MNT 2 trillion 690.0 billion.
MARKET CAPITALIZATION
1,262,497,502,634.80
1,474,173,296,528.22
2,436,324,451,611.78
2,508,040,934,966.89
2,690,320,550,985.47
2015
2016
2017
2018
2019
Marker capitalization 2015-2019
million
In 2019, MSE generated an operating income of MNT 1.6 billion and recorded an operatingexpenses of MNT 1.4, which resulted in net income of MNT 168.9 million. MSE recognized anexpense of MNT 1.2 billion for all expenses related to MIT system as the proposal to sharethe expense with other market operators has not been decided yet. This has resulted a lossof MNT 1.1 billion for the reporting period.
FINANCIAL HIGHLITHS
INCOME EXPENSES МIT system use
Trading fees and
commissions
Fees and commissions
Other income
Total operating income
Salary and taxes
Other operating expenses
Pre tax losses
-1,126.5
MIT usage expenses
-168.9
792
514.7
247.9 1,554.6
-809.1-576.6
Total operating income Trading commission
Service charges and fees Other income
million
million
In 2019, MSE generated an operating income of MNT 1.6 billion. Compared to theend of 2018, trading commissions decreased by 19.8% as a consequence of thedecline of secondary market trading.
TOTAL INCOME
0
200
400
600
800
1000
1200
1400
1600
1800MNT 1,793.3
289.1
517
987.2
TOTALTOTALMNT1,554.6
247.9
514.7
792
2018 2019
0
500
1000
1500
2000
2500
3000
Total operating expenses Salary, social insurance fee
Other expenses MIT amortization expenses
million
TOTAL
2019
million
TOTAL
TOTAL EXPENSES
MSE recognized an expense of MNT 1.2 billion for all expenses related to MIT system.This resulted a loss of MNT1.2 billion for the reporting period.A total of MNT 458.6 million of taxes and fees were paid to the State Budget.
MNT 2,598.4
1,273.8
530.8
793.8
MNT 2,681.1
1,295.4
576.6
809.1
2018
million
million million
million
million million
“Mongolian Stock Exchange”Sukhbaatar square 3, Ulaanbaatar, Mongolia
Fax: (976)-11-325 170
Web: www.mse.mn
THANK YOU FOR YOUR ATTENTION.
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