Mmegi Online :: Choppies sparkles on BSE debut
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Last Updated
Tuesday 16 October 2018, 17:21 pm.
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Choppies sparkles on BSE debut

Choppies sparkled on its debut on the Botswana Stock Exchange (BSE) on Thursday last week, firming from the P1.15 Initial Public Offer (IPO) price to end its first day of trade at P1.40 before adding another 15 thebe on Friday to close the week at P1.55.
By Staff Writer Wed 17 Oct 2018, 00:03 am (GMT +2)
Mmegi Online :: Choppies sparkles on BSE debut








The high demand was attributed to investors who did not get the full amount they applied for during the IPO and were looking to the market to accumulate more shares.

The company's IPO was over-subscribed by more than 400 percent, resulting in other prospective shareholders not getting their allocation.

In a bid to achieve a full and healthy spread of shareholders and in the interest of liquidity, the company said it allotted in full applications of 10,000 shares or less, while applications for any number greater than 10,000 will receive 10,000 shares plus 16.88 percent of the excess number above 10,000.

According to company officials, listing on the BSE will create a strategic reserve to allow the retail giant to take advantage of opportunities of acquisitions as and when they arise.

 Speaking at the listing ceremony, Choppies CEO, Ramachandran Otappath, said they were determined to take the company into a more profitable enterprise along with the public involved.

"Choppies started as a family business and later transformed into an enterprise and it is now a public company," he said. "Our aim is to grow this company into a multi-billion pula company."

 The retail group raised P350 million in both the IPO and the private placement.

With 49 stores in Botswana and plans to open seven more by June this year, Choppies is the largest supermarket

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chain in Botswana, raking in over P103 million after tax in 2011.

The public shareholders will have 25.5 percent, both individual and corporate. The directors, Farouk Essop Ismail and Ramachandran Ottappath, have been whittled down to 34,2 percent from 46 percent.

Other pre-IPO minorities, including former president Festus Mogae's 3.4 percent shareholding, hold 5.6 percent in the listed Choppies, while employees hold 0.4 percent.

The group says part of the P350 million will be used to spur Choppies' regional expansion, particularly in South Africa, where the company already has nine stores. It intends to increase its footprint in the SADC region to over 30 stores within the next two years.

Choppies also has its eyes set on the Mozambique, Zambia and Tanzania where the group believes there is still room for growth in the retail sector.

"The group intends to have 16 additional stores over the next two years with a vision to expand to 150 stores over the next five years," the company says. Revenue is forecast to grow by 40.5 percent during 2012 due to strong growth in Botswana and South African operations.Choppies Botswana operations are expected to expand by 18.3 percent for financial year 2012, driven by the opening of eight more stores in the current financial year which are expected to contribute 10 percent of such growth.

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