adminABIDJAN. — African bourses from Côte d’Ivoire to Kenya are forecasting an increase in share sales next year as a rally in stock markets ends a drought in initial public offerings. The Abidjan-based Bourse Regionale des Valeurs Mobilieres, which trades securities from eight West African countries, is set for its first new listings since 2010 with two Senegalese companies, chairman Gabriel Fal has said.
The Stock Exchange of Mauritius may see 15 offerings, while the Nairobi Securities Exchange is predicting five.
“We have been through a very severe crisis since 2008, especially in the exchange industry,” Mr Fal said.
“It’s important that we get new companies, new names.”
The main indices of Kenya, Nigeria and Ghana are among the world’s 10 best performers this year, with investors seeking higher returns as the US Federal Reserve’s monetary stimulus programme pushed buyers into emerging markets, seen as riskier.
Kenya’s all-share gauge led the African rally, adding 47 percent this year to be the world’s fifth-best performer.
Trading volumes on the Mauritian Semdex index will probably jump 30 percent next year after the Port Louis-based bourse introduced lower trading fees last month, CEO Sunil Benimadhu said.
In Kenya, three firms may list on the main bourse, while two others will join the growth and enterprise market segment trading board, which was set up this year, said the board’s chief executive Mr Peter Mwangi.
Mauritius, Namibia, Nigeria and Kenya had new stocks this year.
Last year, Umeme listed in Uganda and Choppies Enterprises started trading in Botswana.
Bucking the trend, no new listings were recorded on the Zimbabwe Stock Exchange this year as anxiety over elections halted foreign investors ploughing into the local bourse.
Instead, a wave of de-industrialisation and lack of recapitalisation are attributed by economists as a factor in the delisting of several counters from the bourse.
Last month, the Zimbabwe Stock Exchange announced a new set of rules that it was set to implement in a bid to “modernise” the local bourse. Chief executive Mr Alban Chirume said the bourse was planning to implement shorter reporting periods of three months next year, instead of six months at present.
“It is no longer enough that investors only know about the performance of a company once every six months. Despite this being an additional cost to the concerned company, it is of immense benefit to other stakeholders,” said Mr Chirume.
African markets need “to have big, high-profile listings to really get this thing going,” African Alliance Securities head of research Randolph Oosthuizen said.
To get a large number of IPOs, the African exchanges “might well be successful in getting smaller companies to list”, he said.
Money Express, a Paris-listed funds transfer company based in Dakar, and Cie Sahelienne d’Industries, doing business as Matforce, which provides cooling systems and energy equipment, are set to list in Senegal in the first half of next year, Mr Fal said.
Côte d’Ivoire’s exchange may also get shares listed as the government sells stakes in state-owned firms, he said.
Mr Benimadhu said as much as US$1 billion has been raised in Mauritius since 2010 and local companies are “using the stock exchange platform to raise capital to fund their growth”.
In Kenya, officials are bringing in new products such as a bond market and derivatives trading to give investors more opportunities, said Mr Mwangi.
“The platform for derivatives is in place, what is outstanding is working with the regulator on the framework to bring those products to markets,” he said.
“For bonds, the expectation is that the new system will be going live in the month of December.” — Bloomberg.
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