Weekly Stock Market Report (3rd July to 5th July)
Economy, Opinion

The first week of July saw equities performance plunge in comparison to the final week of June trading in a 3 day run on the Lusaka Securities Exchange. The bond market equally slid in comparison to the June closing trade week.

Equities Market Performance

In the week ended 05th July 2019, a total of 106,929 shares were transacted in 13 trades, yielding a market turnover of K133,287. A share price gain of K0.04 was recorded in CEC while Zambeef recorded a loss of K0.69. Trading activity was also recoded in Lafarge and Puma. The LuSE All Share Index (LASI) closed at 4,530.54 points. The market closed on a capitalization of K57,663,620,434 including Shoprite Holdings and  K23,424,414,454 excluding Shoprite Holdings.

Bond Market Performance

During the week, bonds of total face value of K37,347,000 were transacted in 7 trades, yielding a market value sales of K20,071,000.

Wednesday 3rd

In 7 trades recorded yesterday, 6,059 shares were transacted, resulting in a market turnover of K7,520. A share price gain of K0.04 was recorded in Copperbelt Energy Corporation. Trading activity was also recorded in Lafarge and PUMA. The LuSE All Share Index (LASI) closed at 4,580.41 points up by 0.34% from its previous close of 4,564.78 points. The market closed on a capitalization of K57,871,020,365 including Shoprite Holdings and K23,631,814,385 excluding Shoprite Holdings.

Thursday 4th

In 1 trade recorded yesterday, 25 shares were transacted, resulting in a market turnover of K49. Trading activity was recorded in Lafarge. The LuSE All Share Index (LASI) maintained its previous close of 4,564.78 points as there were no price movements. The market remained on a capitalization of K57,806,020,341 including Shoprite Holdings and K23,566,814,361 excluding Shoprite Holdings.

Friday 5th

In 5 trades recorded yesterday, 100,070 shares were transacted, resulting in a market turnover of K124,775. A share price loss of K0.69 was recorded in Zambeef. Trading activity was also recorded in CEC Zambia. The LuSE All Share Index (LASI) closed at 4,530.54 points down by 1.09% from its previous close of 4,580.41 points. The market closed on a capitalization of K57,663,620,434 including Shoprite Holdings and K23,424,414,454 excluding Shoprite Holdings.

Financial Insight Analysis

With trading year at the half way mark, the first trading week of July saw the LuSI (local index) 22.80% weaker than its peak in February earlier this year.

Source: Bloomberg

Only four companies traded during the week with CEC Zambia dominating trading. The CEC security fell to its lowest price in June of K1 but quickly rebounded by the time July trading started.

With a PE ratio of 4.43, the CEC security was the most traded in the first half of 2019. This is partly because the security remained undervalued for the most part of 2019.  A company either is undervalued or in a declining business if the PE value of 1 or less. Interest around CEC was at an all-time high in February for the year. However, the security has lost more than 34% in share price since then.

Source: Bloomberg Terminal

With uncertainty around one of the key ingredients that was missing that led to the collapse of the CDC offer for acquisition in 2018, investors will be looking closely at the Owen Silavwe led management team and how they intend to preserve the value creation prospects post 2020.

Bond market activity continued to dominate albeit sales remaining flat at K20 million in a 3 day trading week. However, sales of week 1 July and Week 4 June showed that the former traded at 53.7% of the total face value while the latter traded at 65.5% of the total face value.

Important Announcement

Airtel lists in London

In accordance with the Lusaka Securities Exchange (“LuSE”) Listings Requirements and the Securities Act No. 41 of 2016, and with reference to the press release by Airtel Africa Plc (“Airtel Africa”), the Board of Directors of Airtel Networks Zambia Plc (“Airtel Zambia” or “the Company”) wishes to inform the shareholders of the Company and the general public that Airtel Africa has successfully undertaken an Initial Public Offering (“IPO”) on the London Stock Exchange (“LSE”) on 28 June 2019. Furthermore, Airtel Africa is conducting a secondary listing on the Nigerian Stock Exchange (“NSE”).

 

Investrust EPS 187% Weaker

In accordance with the Lusaka Securities Exchange (“LuSE”) Listings Requirements, the Board of Directors of Investrust Bank Zambia PLC (“the Bank” or “the Company”) hereby advises the Shareholders of the Company that the Earnings Per Share (EPS) for the twelve-month period ended 31 December 2018 is expected to be 185% worse than the twelve-month period ended 31 December 2017.

 

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