FBC Securities (FBCS) says Econet Wireless Zimbabwe’s (Econet) assessment that the Zimbabwe Stock Exchange (ZSE) no longer provided effective value discovery for the company is, in substance, well founded.
In December 2025, Econet announced its intention to delist from the ZSE owing to what it feels is an undervaluation of its worth.
Hence, the company dangled a premium exit offer for shareholders ahead of its planned delisting from the ZSE, an indivisible US$0,50 per share exit strategy, comprising US$0,17 in cash and US$0,33 in Econet Infrastructure Company Limited (InfraCo).
InfraCo houses all Econet’s real estate, tower, and power assets and is expected to make a US$1 billion listing on the Victoria Falls Stock Exchange on March 31 next month, the same day the latter will delist.
For years, several firms have complained that their values on the ZSE are being driven by speculation rather than operations and performance.
“The Econet board’s assessment that the ZSE no longer provides effective value discovery for the Company is, in substance, well founded. Over an extended period, Econet’s market capitalisation has remained persistently disconnected from its economic scale, infrastructure footprint and long-term cash generation capacity,” FBCS said in a recent analysis of Econet’s delisting.
“This misalignment has been driven less by company-specific underperformance and more by systemic factors, including sustained market illiquidity, reduced institutional depth, constrained foreign participation and chronic currency risk discounting.”
FBCS said as a result, Econet’s listed price increasingly reflects tradability limitations rather than enterprise fundamentals.
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Since its announcement, Econet’s market capitalisation has grown to US$1,05 billion, months after trading between US$700 million to US$800 million, higher than its asset base of US$957,32 million as of August 2025.
“In our view, Econet InfraCo represents a strategically attractive opportunity for long-duration infrastructure investment, offering hard-asset collateralisation, USD-linked revenues, and yield-oriented cash flows,” FBCS said.
“Prospective investors should engage in due diligence focused on tenancy concentration, cash-flow sustainability, dividend policy, and governance structures, while being cognisant of potential early trading discounts and liquidity limitations inherent to a listing by introduction.”
FBCS said investment allocation should be calibrated to risk appetite and long-term horizon, recognising that initial market pricing may adjust as liquidity and investor confidence evolve.
InfraCo’s valuation is set to be anchored by long-term, US dollar lease agreements with Econet, providing predictable and stable cash flow.
Infrastructure expansion is also expected to drive value if it increases sustainable earnings for InfraCo.
“The proposed separation of Econet’s passive infrastructure assets into a dedicated infrastructure company is strategically coherent and aligned with global telecom sector trends,” FBCS said.
“Passive infrastructure assets exhibit fundamentally different characteristics from operating telecom businesses, including longer asset lives, more predictable cash flows and lower operational volatility.”
FBCS explained that: “Segregating these assets allows for clearer alignment between asset risk profiles and valuation methodologies, improves transparency around returns on invested capital, and broadens the potential investor base to include long-term infrastructure and real asset investors.”
In addition, FBCS said the move enabled more disciplined capital allocation within the remaining operating company by reducing the tendency for infrastructure value to be subsumed within broader operational metrics.
“From a strategic finance standpoint, this restructuring has the potential to unlock clarity and optionality that were not achievable under the existing corporate structure,” FBCS said.
FBCS is a local financial services firm.
