Fresh investor appetite rallies BSE northwards
Brian Benza | Tuesday October 14, 2014 08:00
In yesterday’s trading, the DCI registered lukewarm trading adding to last week’s momentum in which the benchmark index’s bull run propelled the market to a fresh record high of 9572.55 points.
According to Motswedi Securities, investors returned to the market place after the Independence holiday, with an aggressive appetite for the local stocks as over 30 million shares worth of P163.5 million exchanged hands; the highest weekly trades in more than three months.
“The huge spread between the volumes and the turnover reflected the trades from the highly priced weighted stocks such as Sechaba, Stanchart and BIHL among others which traded large volumes during the week.
“The usual large caps were among the most traded with Choppies topping the volumes by 35.7 percent while Turnstar and Letshego came in with 20.2 percent and 17.4 percent in that respective order,” said Motswedi in a commentary.
In the week, most movers closed at new 12-month highs with the exception of Choppies and Wilderness. On the gainers front, Sefalana led the upside as it surged by 5.5 percent to trade at 900 thebe, as investors remain sanguine about its outlook at the back of the 12 stores in Namibia and lucrative tenders secured by the group.
On the banking space, Stanchart edged up by 4.2 percent to trade at 1250 thebe. Meanwhile, Wilderness recent trading statement was well embraced by investors, as it soared by 3.4 percent to end the week trading at 300thebe. According to the statement, the group’s interim results for the six months ended 31 August 2014 are likely to be significantly higher than those achieved in the six months ended 31 August 2013.
Choppies leaped 2.4 percent to trade at 419 thebe on optimism about its expansion strategy beyond Botswana. The retail giant has managed to increase its footprint as it has opened 27 stores in SA and 13 in Zimbabwe.
On the other hand, Letshego put in a third straight week of gains advancing by 1.9 percent, as investors remain bullish about the group as it was recently granted a provisional banking license in Namibia. The rally, driven by both individual and institutional investors, is expected to be the ultimate of the year before the market enters its usually festive season profit taking period. While institutional investors dominate most of the trading on the bourse, the BSE 2013 annual report states that shares trading by individuals has jumped nearly 200 percent in the past five years. According to the Report released last week, local individual contribution to turnover in 2013 was 8.7 percent rising by nearly threefold over the past five years from three percent in 2008.
The BSE registered a record turnover of P2.3 billion in 2013; meaning retail investors traded shares worth P200 million on the bourse in the year.
“Over the past three years, local individual investor contribution to turnover has averaged 8.4 percent. The growth in retail investor participation is a welcome indication of financial inclusion of citizens in the economy of the country.
“In 2013, local individual investments in the BSE more than doubled and totalled P201.7 million as measured by their contribution to turnover, an increase of 111.4 percent in comparison to 2012,” read the report.