eBusiness Weekly
Trading on the Zimbabwe Stock Exchange in the month of July was largely positive although the second half of the month was characterised by share price volatility as investors took a cautious approach ahead of the 2018 harmonised elections which took place on Monday, July 30, 2018.
By the close of trading in July, the ZSE main industrials index was up 12,1 percent to 384.25 points while the ZSE All Share index was up 11,95 percent.
The ZSE top 10 up 15,33 percent to 103.04 was, however, the biggest mover among indices as investors sort to hedge in quality stocks including dual listed Old Mutual and PPC Limited.
The Mining Index slightly changes after it recorded marginal gains up 1,68 percent to 163,99 percent.
Stocks that found favour with investors in terms of share price gains were Seed Co up 27,7 percent as the company is working on listing its operations on the Botswana Stock Exchange.
The proposed partial unbundling of Seed Co Limited and the subsequent separate listing of its regional operations on the Botswana Stock Exchange (BSE) will provide the group with a vehicle for offshore fund raising.
At an annual general meeting to be held this month, Seed Co will seek shareholder approval to raise $19 million through a partial unbundling.
The seed making company has expansion projects that require immediate funding to the tune of $31 million. On the 26th of July, shares worth $2,07 million changed hands in the agricultural concern.
First Mutual Properties up 26,8 percent, Turnall up 22,7 percent, Innscor up 20,3 percent and Delta up 19,4 percent were the other top movers.
Delta also came out with a trading update during the month showing double digit growth in volumes despite foreign currency shortages that led to product supply shortages.
Despite the foreign currency challenges, Delta’s revenue for the quarter jumped 40 percent compared to same period last year on volumes growth.
Management said all beverage categories recorded increases in revenue which positively impacted on the bottom-line.
Penny stock Medtech, with a market capitalisation of just $300 000 was, however, the month’s biggest loser after it dropped 60 percent and 50 percent in two consecutive weeks to take its year-to-date loss up to the end of July to 80 percent. Other stocks that weakened were sister companies Fidelity Life down 15 percent, ZHL down 13,04 percent and ZPI down 10,99 percent.
Financial services company GetBucks completed the famous five loser after its share price weakened by 10,99 percent to 3,33 cents. July saw the exit of founding parent company Brainworks as a major shareholder.
Brainworks founders George Manyere and Walter Kambwanji were reportedly on the other side of the deals that saw shares worth approximately $12 million trading on the ZSE.
The month’s biggest deal was however conducted in telecoms company Econet Wireless Zimbabwe after shares worth $31 321 300, approximately 1,5 percent of the company’s market capitalisation changed hands. The 25 million ordinary shares traded at a negotiated price of 125 cents. Econet is now the biggest company on the ZSE by market capitalisation at $3,2 billion overtaking Delta at $2,7 billion. This comes after class A shares were for the first time included on the ZSE but only for the purpose of calculating market capitalisation.
Econet spokesperson Fungayi Mandiveyi said the Class A shares will not be trading on the Zimbabwe Stock Exchange but will now be included in the company’s market capitalization “but that it is not the same as having them listed.”
4 000 register on C-Trade
Meanwhile, the introduction of C-Trade has seen more than 4 400 people registering to participate in the trading of shares on the country’s equities and debt markets, the ZSE and FinSec.
According to Escrow Group chief executive officer Collen Tapfumaneyi about 800 retail clients have placed buy orders through the system.
“However most buy orders have been rather small and could not be executed as there were no sellers for some of the small amounts,” he noted.
Tapfumaneyi said the uptake of the product was in line with “our expectations”
“C-Trade was designed with financial inclusion in mind and despite the dominance of politics and elections in the past two weeks, the response levels from first time investors have been remarkable. Once we are beyond elections and roll out investor education and marketing campaigns the numbers can only improve,” said Tapfumaneyi.
