FEDERATION OF EURO-ASIAN STOCK EXCHANGES
ANNUAL REPORT JUNE 2012
“TOSHKENT” REPUBLICAN STOCK EXCHANGE
Year 2011 was the most productive for the
entire period of the Exchange.
Shahruh Hakimov
Chairman of the Executive Board
Main indicators of the activities of the
“Toshkent” Republican Stock Exchange for
2011
“Toshkent” Republican Stock Exchange is
the main marketplace on corporate securities
market in the Republic of Uzbekistan.
Analysis of the dynamics of stocks turnover
for the last five years shows that current year
securities market showed a very rapid growth.
Thus, in 2007-2008, the volume of securities’
transactions slightly exceeded the mark of UZS
100 bln., however, in the next two years there
was a decline in the stocks turnover.
Year 2011 was the most productive for the
entire period of the Exchange. As a result of
significant recovery of the stock market and
activation of its members in the current year,
turnover of securities amounted to UZS 213.1
bln., which is more than 3 times higher than
similar indicator in 2010.
One of the main indicators of the republic’s
securities market competitiveness is the degree
of the secondary stock market development.
Proof of this is the dominance of the securities
secondary circulation market in the structure of
the total stock market turnover for the past five
years.
Primary market share in 2011 accounts for
47.0% of total stock market turnover, or UZS
100.2 bln.
According to the results of 2011 share of issues
of banks’ securities in primary placement of
newly issued stocks and bonds of all joint-
stock companies accounts for the major part
of placements - 67.8% of total volumes of new
issues.
Second place among successfully allocated
new issues through the Stock Exchange
belongs to enterprises of industrial sector -
25.8%.
Securities of commercial banks also hold a
leading position in the secondary stock market
- 65.4% of secondary circulation volume.
Great interest of investors in the secondary
stock market comparatively to previous years
is aroused also by the securities of industrial
enterprises - 19.4%.
Analysis of indicators on the activities of the
Stock Exchange in 2011 throughout sectors of
economy shows that an increasing demand for
securities of enterprises of non-commodities
sectors with higher added value has had a
large impact on the stock market. Among them
the most investment attractive were securities
of companies engaged in the financial services
sector, particularly banks.
So, if in 2008 share of securities of commercial
banks constituted 39.1% of total stock market
turnover, then according to 2011 results this
indicator constituted 64.4%, i.e. increased by
1.6 times.
High indicators of the banking sector
are achieved largely through the actions
undertaken to implement the Program of
measures to further increase capitalization
and investment activity of commercial banks
for 2010-2012, approved by the Decree of the
President of the Republic of Uzbekistan of
April 6, 2010 No. PP-1317 “On measures to
further enhance financial stability and increase
investment activity of the banking system”.
Also, significant amount of operations has
been performed with securities of industrial
enterprises, which accounted for 21.6% (46.0
billion sums) of the total stock turnover.
In general, the structure of total primary and
secondary securities turnover on the Stock
Exchange in 2011 by major sectors is as
follows:
- share of financial sector enterprises accounts
for 67.7% of the turnover, or UZS 144.6
bln. (commercial banks - 64.4%, insurance
companies - 2.8% and leasing companies
- 0.5%). In comparison to previous year, the
turnover of securities of the financial sector
enterprises as a whole grew by 3.7 times;
- share of industrial sector enterprises - 21.6%
of the turnover or UZS 46.0 bln., (increase by
almost 3.5 times);
- share of agricultural sector enterprises – 2.0%
or UZS 4.2 bln. (increase by 1.4 times).
One of the main current priorities is to attract
well performing and the most financially stable
national companies as well as their stocks to be
listed on the Stock Exchange.
It should be noted that recently taken measures
to make listing procedures more attractive and
transparent have given positive effect.
So, if in 2006 number of listed companies was
only 4, then in 2011 official stock exchange
listing of the “Toshkent” RSE included shares
of 100 joint-stock companies. Among the listed
companies are commercial banks, insurance
companies, enterprises of oil and gas industry,
light industry, production of construction
materials, agriculture, energy, metallurgy
sectors, etc.
In recent years there has been a significant
increase in the share of turnover of stocks of
listed companies in the total turnover of the
Exchange. So, if in 2008 this indicator was
37.5%, then in 2011 it reached to 49.6%.
Important advantage of a joint-stock company
being listed in stock exchange is the regular
quotation of prices for its securities, resulting
in the formation of market mechanism of
determination of fair price of the securities,
which in turn promotes the growth of its
capitalization.
So, as of December 31, 2011 indicator of
market capitalization of joint stock companies
shares included in the official stock exchange
listing, amounted to UZS 5 282.8 bln. (increase
by 11.3% compared with that as of December
31, 2010).
The share of capitalization of listed companies
from the whole capitalization of the joint-stock
companies whose shares are traded on the
stock market is 58.1%.
One of the main factors that activate the stock
exchange functions is expansion of the number
of potential investors. At present, more than
ever before, opportunity to get “quick money”
by trading securities has increased. World
practice shows that these securities offer higher
returns and more reliable protection against
inflation than any other type of investment. It is
obvious that in our country a class of investors,
that activate their participation in the securities
market and understand that by acquiring
shares of joint-stock companies, they become
owners of tangible assets that have a real
prospect of growth, is gradually beginning to
shape.
There is no doubt that raising the level of
investor confidence in the stock market
instruments and expansion of the participation
of population and legal entities in the securities
market is one of the major objectives in the
future work of “Toshkent” Republican Stock
Exchange. Accordingly, the promotion of
investments in financial instruments, informing
the public and investors about advantages and
perspectives of the domestic stock market,
creating favorable conditions for securities
trading will ultimately allow more people
and corporate entities to participate in the
processes of attracting and investing financial
resources in order to both generating additional
incomes and realize investments projects vital
for the development of national economy.
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