Local companies on the Botswana Stock Exchange took a beating on their share prices this week, with Standard Chartered Bank Botswana sinking to its lowest point in more than 11 years, over the course of a single day's trade.
By last week Friday, the BSE’s Domestic Companies Index had shed 1.3% for the year, a resilient performance when compared to the massive losses in other African and global stock exchanges due to the impact of the Coronavirus (COVID-19).
However, this week, the DCI, which is the Exchange’s main platform, moved its year-to-date losses to 2.1%, as the limited trades on the local exchange turned negative for several listed companies.
Standard Chartered spent the first three months of the year anchored at P1.67 before falling in early April to P1.58. Earlier today, the bank’s share price shed 19 thebe to P1.39, the lowest it has been since late 1998.
Minergy, the country’s newest coal producer, shed 25 thebe in today’s trading session, ending at 85 thebe, its lowest point since listing on the BSE in April 2017.
Motswedi Securities head of research, Gary Juma told MmegiOnline the share price downturn for Standard Chartered did not appear related to the bank’s performance or other internal factors.
“The market is really depressed and investors are looking for cash,” he said.
“StanChart released results recently which were quite fair. They made a profit and are now
Juma said it was possible the trades in the bank were the result of a bookover, where a fund manager sells from one account they manage and buys into another they manage.
Minergy, meanwhile, recently told investors it had lost a month’s worst of sales and was under financial pressure due to the impact of the Coronavirus on operations.
“Minergy has been liaising with its government-linked funders and has requested additional funding and assistance during this period,” the company said.
“Initial discussions reflect goodwill which is greatly appreciated and will be built and executed upon. Discussions are in progress with major suppliers, who are also battling the impact of COVID-19.”
The DCI’s performance this week was also impacted by a five thebe drop in First National Bank Botswana, the country’s largest bank by balance sheet.
For the end of the week, Letshego was still the highest performer on the DCI, with net gains of 14.1% for the year to date, followed by Letlole la Rona with 4.4%. Minergy is the worst performer on the DCI for the year having shed 22.7%, followed by StanChart with 16.8%.