Online Reporter
Nelson Gahadza
TSL Limited is poised for sustained earnings growth underpinned by a strong agricultural season, logistics business expansion and a planned migration to the Victoria Falls Stock Exchange, market watchers say.
The group said in its half-year financial statement that, in the outlook, it will continue to focus on its strategic priorities, improve operational efficiency, allocate capital efficiently and deliver sustainable returns to shareholders.
In its half-year earnings analysis for the six months ended April 30, 2026, FBC Securities said TSL’s strong operational performance and diversified earnings base positioned the company favourably for medium-term growth.
“TSL offers investors US dollar-denominated exposure to Zimbabwe’s agricultural recovery at a discount to intrinsic value,” the brokerage said.
The company recorded a 33 percent increase in revenue to US$26,23 million during the period, from US$19,67 million in the comparable period last year, while earnings before interest, tax, depreciation and amortisation (EBITDA) rose 29 percent to US$9,74 million.
Profit after tax climbed 45 percent to US$5,6 million, while earnings per share improved 47 percent to 1,50 US cents.
The improved profitability was attributed to lower finance costs, operational efficiencies and stronger demand across its agriculture-related businesses following favourable rainfall conditions.
Agriculture remained TSL’s dominant revenue contributor, accounting for 66 percent of total turnover, reinforcing the group’s exposure to Zimbabwe’s agricultural value chain.
FBC Securities said strong crop production had boosted demand for inputs and services across the business, with crop chemical volumes increasing by 47 percent and contract tobacco volumes surging 87 percent to 36 million kilogrammes.
The brokerage firm also highlighted several growth catalysts expected to support future earnings.
Among these is TSL’s proposed migration from the Zimbabwe Stock Exchange to the VFEX, which has already received board approval and remains subject to regulatory clearances.
According to FBC Securities, the move could unlock greater liquidity, provide investors with US dollar-denominated trading and potentially trigger a market re-rating of the stock.
The group is also preparing to unlock value from its 73-hectare Harare South land bank, with development expected to begin in the fourth quarter of 2026.
The project is expected to deliver about 1 900 residential stands alongside commercial space, creating an additional revenue stream outside TSL’s traditional agro-industrial operations.
In logistics, the brokerage said investments in the Rutenga multimodal inland port and the expansion of an electric forklift fleet would strengthen capacity and support volume growth.
Container handling volumes at the port have already risen by 76 percent, while cargo handling volumes increased by 33 percent.
FBC Securities projects revenue to rise to US$62,6 million in 2027 before increasing to US$84 million by 2030.
Normalised profit after tax is forecast to grow from US$8,97 million in 2026 to US$15,29 million by 2030, while earnings per share are forecast to increase from 3,43 US cents to 4,96 US cents over the same period.
Despite the optimistic outlook, the brokerage cautioned that several risks could affect performance.
These include the possibility of an El Niño-induced drought during the 2026/27 agricultural season, weaker tobacco prices, exchange rate volatility and higher operating costs linked to taxes and imported inputs.
FBC Securities also flagged liquidity constraints on the local bourse as a risk, although it said the planned VFEX migration was intended to ease institutional investors’ concerns over position sizing and exit opportunities.
The group is looking forward to executing several projects to drive earnings growth.
Following receipt of the necessary regulatory approvals in 2026, development of TSL’s 73-hectare Harare South land bank is expected to commence in the fourth quarter of 2026.
The project is estimated to deliver 1 900 residential stands, complemented by commercial stands and community amenities.
