BSE in fast take-off

SHARE   |   Sunday, 18 January 2015   |   By Kabelo Adamson
BSE DEPUTY CEO: Tsheole BSE DEPUTY CEO: Tsheole

… 15.7 m shares valued P83 m exchange hands in first week

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The first days of the year saw the market kick-off with a bang as most domestic counters cruised in black. This is according to Motswedi Securities’ weekly financial highlight, which observed that as the first half of the financial reporting period approaches, most of the blue chips would be expected on the podium with their financial results.

It is anticipated that sectors such as retail and property will fare well while the banking sector, which appears to have been left behind due to the lower interest rates are expected to return to the glory days.  Two commercial banks quoted on the Botswana Stock Exchange, FNB Botswana and Barclays Botswana closed 2014 with lackluster performance, weighing down the market at the BSE as the main index went down by 1.0 percent in USD terms.

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It, however, remains to be seen how they will perform after the release of the financial results and whether they would reclaim their spots in the market.

As of last week, about 15.7 million shares worth of P83 million exchanged hands. Micro lender Letshego Holdings Limited dominated the trades leading by 54.6 percent while wholesale and retail giant Sefalana Holding Company traded 38.8 percent of the total volumes.

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The report suggests that the Domestic Company Index looks set to maintain its upward momentum as during the early days of 2015 it accumulated 16 basis points while the Foreign Company Index seems not to move out of the negative territory, giving up 13 basis points.

Property counters Letlole and PrimeTime in these early days have spearheaded the domestic index as they gained 2.3 and 1.9 percent respectively, having started the year trading at 220 Thebe and 265 Thebe respectively.

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On the banking sector, Barclays bank gained 1.4 during the early days. For the past three reporting periods the bank has been posting disappointing results, which the management blamed on implementing the ‘Go-To’ bank strategy, which increased its operating costs.

Sefalana, one of the best performers as far as the share price is concerned for the last few years, took off with a positive charge, taking off where it ended last year. With its financial report for the six month period ending 31 October 2014 expected by the end of this month, the group has already issued a series of press statements confirming that its anticipated results will be better than the previous corresponding period. The group led by the former Vice President Ponatshego Kedikilwe as the chairman is expecting profitability following the acquisition of stores in Namibia as well as attractive tenders.

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Other major movers at the dawn of 2015 are Turnstar Holdings Limited, Chobe Holdings, Botswana Insurance Holdings Limited (BIHL) and Stanchart, which performed well last year.

On the losers’ end were Letshego as it retreated by 0.4 percent to trade at 265 Thebe while Sechaba – the holding company for Kgalagadi Breweries Limited following the increase of the alcohol levy late last year – also lost the same percentage to trade at 2810 Thebe. 

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Despite the early setback, Sechaba was one of the best performers of 2014 notwithstanding the hostile operating environment, which includes the alcohol levy that currently stands at 55 percent after the recent increase as well as Traditional Beer Regulations.



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