Mongolian stock market in 2024

The Mongolian stock market is ending 2024 as a year of stable growth and active market trading. Throughout the year, a wide range of stocks, bonds, and asset-backed securities were traded on the Mongolian Stock Exchange (MSE), creating an active investment environment that is bringing positive results to the economy.

2024=GREEN YEAR

In 2024, the Mongolian Stock Exchange indices, MSE-A, MSE-B, and TOP-20, are all ending a green year with growth. The TOP 20 reached an all-time high of 49,252 in September 2021. It reached 50,741 in August this year, putting an end to the decline in the Mongolian stock market.

HIGHLIGHTS OF THE MARKET /NOVEMBER 2024/

• Total trading volume: 1.175 trillion tugriks
• Stock trading: 289.87 billion tugriks
• Bond trading: 743.58 billion tugriks
• ABS trading: 130.76 billion tugriks
  Investment fund trading: 7.55 billion tugriks
  OTC trading: 3.0 trillion tugriks /as of 12.17/

Stock trade:

As of November 2024, 25 percent of total trading was in shares. A total of 3 companies have made IPOs on the Mongolian Stock Exchange. These include:

Did the TOP-20 index companies increase or decrease?

The TOP-20 index, which had been declining since its historic high in 2021, reached an all-time high of 50,741 in 2024, and the average growth rate of the 20 companies in the index increased by 13.3 percent. In 2023, only 5 companies had growth, while this year 9 companies had growth. The company that showed the highest growth last year, “Tavantolgoi” JSC, also showed a 103 percent growth this year, and has shown a total growth of 213 percent in the last 2 years. However, the share price of “Mongolian Stock Exchange” JSC, which was the second-lowest in 2023, has shown a 168 percent growth this year and led the top 20 index.

BOND MARKET ACCOUNTS FOR 63 PERCENT OF TOTAL TRADING

2024 was a historic year in the bond market. Because in June 2024, Mongolia’s first municipal bond, the “Ulaanbaatar Bond”, successfully raised 500 billion tugriks. Also, a new product of the Mongolian capital market, green bonds, was successfully raised at the end of 2023. “Khaan Bank” JSC issued tranche 1 of its green bond, and in 2024, “Khaan Bank” JSC successfully raised tranche 2 of $25 million and “TJBT” LLC’s green bond. $11 million.

ABS MARKET SHOWS VERY HIGH GROWTH

In 2023, a total of 3 companies successfully launched IPOs in the market, with a total trading volume of 63.5 billion tugriks, while this year, 3 companies also launched IPOs, with a total trading volume of 130.8 billion tugriks, an increase of 105 percent. Also, the highest-value IPO in the market, an IPO of 50 billion tugriks, was launched by “Invescor BS TZK” LLC.

OTC MARKET

Since the inception of OTC until the third quarter of 2024, a total of 127 companies have successfully attracted investment. As of December 17, 2024, a total of 3.0 trillion tugriks were traded, of which 1.9 trillion tugriks constituted primary trading. Green bonds have even been issued on the BBZZ. For example, “State Bank” JSC issued a green bond worth 10 billion tugriks.

WILL NEW PRODUCTS ENTER THE MARKET? AND WILL TOP 100 COMPANIES DO IPO OR ISSUE BONDS?

One of the highlights of this year is the amendment to the “Law on Securities Market”. For example, the Mongolian Stock Exchange, the Financial Regulatory Commission and the Mongolian Securities Traders Association have the right to approve 12 new and revised regulations. This opens up opportunities for new products to enter the market and for TOP-100 companies to easily participate in the stock market.

New products entering CAPITAL MARKET:

• Crowd funding
• Issuance of bank certificates of deposit,
• Debt instruments of international financial institutions,
• Trading of shares of closed joint-stock companies on the stock exchange,
• Securities lending and borrowing

HOW WILL THE MARKET CHANGE IN 2025?

• With the amendments to the law, new products are likely to enter the market and the number of investors is likely to increase.
• TOP-100 companies and state-owned companies are expected to hold IPOs next year.
• The stock market decline has come to an end this year and is expected to continue next year.
• As global copper and gold prices are expected to rise, mining companies’ share prices are likely to grow steadily. Underground mining at the Oyu Tolgoi project will begin operating at full capacity.
• Debt instruments trading, which accounted for 63% of total trading in 2024, is likely to increase further in 2025. Banks and large enterprises will begin to actively use debt financing.
• The Central Bank’s monetary policy will continue to stabilize inflation, which is likely to have a positive impact on the investment climate.

Source: MSE, FRC,MASD