Five counters account for 69% ZSE turnover

Justin Bgoni

Five out of 55 counters listed on the Zimbabwe Stock Exchange (ZSE) accounted for 69% of the bourse’s turnover as at December 9, 2022, according to chief executive officer (CEO), Justin Bgoni.

In email responses to questions from Standardbusiness, Bgoni said the ZSE’s turnover reached $126 billion during the period.

He said the top five counters during the period under consideration generated a total of $86,7 billion in total turnover.

Technology firm Econet generated $25 billion, followed by beverages bluchip, Delta, which turned over $23 billion, while Lafarge Cement Zimbabwe’s turnover was $19 billion, Bgoni noted.

He said Innscor and Simbisa Brands turned over $11 billion and $8,7 billion respectively.

The ZSE All Share Index has risen by 36% since the start of the year.

“Common with any market, the stock exchange can experience different cycles which we have also experienced this year,” the ZSE CEO said.

“The market peaked between January and April where it gained 162%.

“However, since the regulatory interventions to curb speculative trading, the market lost 48% from the end of April to date.”

In April, the ZSE market capitalisation peaked at $3,5 trillion before dropping to $1,82 trillion in May, representing a 48% drop.

At the end of the first half, Treasury increased capital gains tax on shares held for 270 days or less to 40% in order to bring them into line with the top marginal tax rate for Pay As You Earn and encourage long-term investments on the stock market.

The ZSE market capitalisation as of December 9, according to Bgoni, was $1,63 trillion, up 24% year-to-date.

In 2022, according to Bgoni, the ZSE witnessed the transfer of Simbisa Brands from the ZSE to the Victoria Falls Stock Exchange (VFEX), among major developments.

He also pointed to the upcoming listing of the US$50 million bond by Karo Mining Holdings this month as a highlight of the year

Bgoni stated that he was not concerned about the recent upsurge in companies delisting from the ZSE to join VFEX, which is a unit of the ZSE.

“VFEX was actually launched to complement ZSE, and the establishment of VFEX actually benefits both investors and issuers,” he said.

“Migration from ZSE to VFEX by issuers is purely a business decision for the issuers done with the approval of the company’s board of directors and its shareholders and we are not alarmed by the migrations since our issuers are diverse covering various sectors with different business needs.”

He also mentioned that Tigere, the first REIT in Zimbabwe, has recently listed on ZSE.

“We are bullish on further REIT listings on ZSE,” Bgoni said.

In response to the probe into claims of insider trading involving Willdale directors, Bgoni said the matter was being handled in the brick making firm.

Early this year, the Zimbabwe Securities and Exchange Commission asked the ZSE to look into claims of insider trading among Willdale directors.

The Securities  and Exchange Act forbids people from trading in securities when they have inside knowledge about those securities and stipulates both criminal and civil sanctions for such trading as well as other unethical behaviour.

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