Sefalana looks to Lesotho, Namibia, SA

SHARE   |   Wednesday, 10 October 2018   |   By Kabelo Adamson
Dr Ponatshego Kedikilwe [L] with Sefalana MD, Chandra Chauhan Dr Ponatshego Kedikilwe [L] with Sefalana MD, Chandra Chauhan

As Botswana slows down    

Sefalana Group says it is pinning its hopes on the Lesotho and Namibia businesses while the local economy recuperates from lower levels of spending and higher levels of unemployment.

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Writing in the company’s annual report, the group board chairperson, Dr Ponatshego Kedikilwe, says they are encouraged by these markets as the local economy operates below average, with the markets said to be providing augmentation towards the group’s overall results.

Kedikilwe says they are also pleased to announce that the South African market has generated a sizeable first-year return, contributing significantly to this year group results.

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Sefalana has grown its total number of stores to 73 and further invested in a South African consortium which owns 14 stores. Dr Kedikilwe, who is the former Vice President, says they are working on additional store openings in the coming year as the group works on strengthening its brand.

Sefalana group Managing Director, Chandra Chauhan, shares the same sentiments as the board, saying diversification into the region over the last four years has helped them to maintain the group’s overall performance.

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“Our most recent entry into the South African market has resulted in a sizeable contribution to the bottom line results for the current year,” Chauhan wrote in the report.

The aim of the consortium, Chauhan says is to acquire a number of existing chains and grow the store compliment such that it is a significant business within a 10-year period. He says they have been working on this transaction for 18 months and had to ensure that it is structured in a manner suitable for Sefalana.

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The structure allows Sefalana a five-year period to determine its appetite for the South African market and during that time provide it with a solid guaranteed return. During the past year, the consortium contributed P33m of income from this investment, which represents 10 months returns since beginning of July last year.

Currently Sefalana has a total of 16 stores across the border in Namibia. Chauhan says there are a number of potential stores in the pipeline to expand the presence further in the area.

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Lesotho despite a turmoil political landscape, Chauhan says, continues to show positive signs of growth. Chauhan says they are operating in a very low margin in Lesotho and therefore look to improve the profitability of this business through topline growth and by offering customers an excellent service.



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