The Sunday Mail
Enacy Mapakame
Business Reporter
Investors on the Zimbabwe Stock Exchange (ZSE) lost a cumulative RTGS$1,5 billion last week driven by a sell-off in big-cap counters.
Government is currently implementing sweeping reforms designed to improve production, exports, foreign currency inflows and foreign direct investment.
The Reserve Bank of Zimbabwe recently abandoned the currency peg and opted to float RTGS balances as it continues to push for currency reforms expected to stabilise the economy. During the week to Thursday, all counters that make up the ZSE Top 10 Index recorded losses as selling pressure persisted.
The top 10 counters account for three-quarters of the overall market value.
As a result, total market capitalisation retreated 8 percent to close at RTGS$17,3 billion from RTGS$18,9 billion recorded in the previous week.
The primary indicator, the ZSE All-Share Index, eased 7,5 percent to 134,14 points.
At 447,37 points, the Industrial Index was 7,2 percent below prior week level.
The market’s heavies — the ZSE Top 10 Index — were the heaviest casualties after letting off a hefty 7,2 percent to 128,99 points, extending its year-to-date losses by 11,4 percent.
The Mining Index, which is made up of two counters, lost 5,4 percent to 201,72 points.
The market’s three top counters by market capitalisation — Cassava, Delta and Econet — fell by 8,2 percent to RTGS$1,26; 7,93 percent to RTGS$2,39 and 7,9 percent to RTGS$1,24, respectively.
During the week under review, Cassava expanded its Vaya digital platform to offer ambulance services, which come a few months after the company unveiled the ride-hailing application.
Using cash, EcoCash and medical aid as forms of payment, the Vaya ambulance will assign a customer the nearest ambulance and enables one to track it.
Diversified industrial group Innscor backtracked by 9,5 percent to RTGS$1,44 after reporting a 100 percent growth in operating profit to RTGS$80, 5 million for the six months to December 30 2018.
Its revenue surged by 61 percent to RTGS$490 million as profit after tax improved 167 percent from RTGS$24 million to RTGS$64 million.
Cigarette manufacturer, BAT, which caps the market’s top-five counters, fell 2,9 percent to RTGS$32, remaining ZSE’s most expensive stock. Other market’s heavies, SeedCo Limited and SeedCo International lost 13,88 percent to TRGS$1,64 and 5,73 percent to RTGS$1,79 in that order. National Foods closed the week 2,2 percent to RTGS$7.
The agro-industrial giant reported profit for the half-year to December 31 2018 grew 78 percent to RTGS$16,8. It reported the central bank had assumed its legacy debt of US$54,9 million owed to its major grain supplier following an agreement late in 2018.
Industry has been battling foreign currency challenges, which had a knock-on effect on production, resulting in supply gaps.
Also on the downside were Old Mutual and Padenga that fell 2,7 percent to RTGS$7,30 and 6,8 percent to RTGS$90,59 cents, respectively.
On the resources side, the only active counters Bindura and RioZim recorded losses of 12 percent to RTGS$7,04 cents and 2,7 percent to RTGS$1,80 in that order.
Bandura recently reported its proposed sale by its holdings company ASA Resources had hit a snag after negotiations with the anticipated buyer were “terminated.”
Its parent company, currently under administration, announced it had entered into a sale and purchase agreement (“SPA”) with a third party in relation to the 74,7 percent shareholding in Bindura with a UK listed firm.
On the upside, Willdale put on 6,7 percent to RTGS$1,9 cents. African Sun, Dairibord, Ariston and Lafarge were flat at RTGS$15 cents, RTGS$14,9 cents, RTGS3 cents and RTGS$1,33 respectively.
