Online Reporter
Nelson Gahadza
Investment research firm IH Securities states that Econet Wireless Zimbabwe’s shares remain significantly undervalued despite the telecommunications giant’s strong earnings performance.
The firm projects a 91 percent upside in the stock’s value over the next 12 months.
This comes as Zimbabwe’s largest telecoms operator speeds up its AI-led transformation.
In its latest equity research update, IH Securities placed an undervalued recommendation on Econet, setting a 12-month target price of US$0,96 per share against the current over-the-counter reference price of US$0.50 following the company’s voluntary delisting from the Zimbabwe Stock Exchange.
The brokerage said the discount reflects frontier market risks and pricing inefficiencies in the over-the-counter market rather than weaknesses in the company’s underlying fundamentals.
“IH Securities has revised its valuation methodology to place greater emphasis on the company’s intrinsic cash flow generation, reflecting confidence in Econet’s long-term earnings potential,” the report said.
The bullish outlook follows a strong financial year in the full year ended 28 February 2026, in which Econet posted a 23 percent increase in revenue to US$1,1 billion, driven by growth across its core telecommunications, data and fintech businesses.
Net income attributable to shareholders surged 142 percent to US$229 million after exchange losses declined sharply, while earnings before interest, tax, depreciation and amortisation reached US$459 million, representing a healthy margin of 40,6 percent.
IH Securities said Econet’s strategic transition from a traditional telecommunications operator into an AI-enabled digital services company is expected to become an important growth driver over the coming years.
During the year, the company commissioned 200 new base stations, including 95 fifth-generation (5G) sites, significantly expanding network coverage and capacity.
Data traffic doubled during the period, while voice traffic increased by 35 percent, reflecting growing demand for digital connectivity.
The brokerage also highlighted continued momentum within EcoCash, where higher transaction volumes and a growing customer base supported the fintech division’s expansion.
The mobile money platform was further strengthened through technology upgrades and the rollout of new financial inclusion services.
Data and internet services remained Econet’s largest revenue contributor, accounting for 41,6 percent of total revenue, followed by airtime sales at 28,3 percent and mobile money services at 11,2 percent.
Looking ahead, IH Securities expects revenue to grow by a further 13,5 percent to US$1,28 billion in the current financial year, supported by continued expansion in data consumption, stronger mobile money activity and new revenues from AI-enabled services.
The research firm forecasts EBITDA of US$552 million, lifting margins to 43 percent, while net profit is projected to climb to US$329 million as operating efficiencies improve and exchange losses remain subdued.
IH Securities said Econet’s dominant position in Zimbabwe’s telecommunications sector provides a solid platform for sustained growth.
According to the latest Postal and Telecommunications Regulatory Authority of Zimbabwe statistics cited in the report, Econet commands about 73,75 percent of the country’s active mobile subscriptions, maintaining a commanding lead in the market.
