Sub-Saharan Africa Stock Markets 2010 Review & 2011 ... - Imara

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EQUITY RESEARCH BOTSWANA FEBRUARY 2011 2010 REVIEW AND 2011 OUTLOOK The economy recovered and grew by about 10.7% in real terms over the four quarters ending September 2010 after contracting by 3.7% in 2009, but despite this the stock exchange ended the year with a negative return. This good economic performance was due to the global economic recovery, which led to the improvement of diamond and copper sales in the world market. As a result the mining sector experienced a 21.7% increase albeit from a low base. The rest of the economy grew by 6.3% during the same period. Total revenues and grants amounted to BWP 30.0bn in 2009/10 representing a net increase of BWP 2.24bn or 8.07% more than the revised estimates. The additional revenue can be attributed to the recovery of the diamond markets, with mineral revenue accounting for the highest increase of BWP 2.25bn or 33.0%. Total expenditure and net lending in 2009/10 amounted to BWP 39.49bn compared to BWP 41.27bn in the revised budget, representing under expenditure of BWP 1.78bn or about 4.3%. As at end of November 2010, foreign exchange reserves stood at BWP 54.9bn, a decrease of 5.2% from BWP 57.9bn as at December 2009. The BWP 54.9bn represents about 17 months of import cover. On an annual basis the Pula depreciated against the rand (-6.79%) while it appreciated against the euro (+10.67%), the pound (+6.58%), and the US dollar (+2.31%), respectively. It is anticipated that inflation will, in the short term, continue to be higher than the upper bound of the medium term 3%–6% objective range. In addition to the continuing effect of the increase in value added tax and administered prices and the December 2010 increase in the alcohol levy, the short term inflation forecast also factors in the expected upward adjustment of private school fees and electricity tariffs and fuel prices. In the absence of these factors, inflation would be within the Bank’s 3%–6% inflation objective range. It is, therefore, expected that inflation will fall within the objective range in the second quarter of 2011, as the impact of these transient factors dissipates. Top 5 Gainers and Losers- 2010 Opening Closing % Change % Change Company Price Price (LC) (USD) ABCH 1.29 2.45 89.92% 94.30% Engen 3.80 6.40 68.42% 72.30% RDCP 4.20 6.30 50.00% 53.46% G4S 23.60 31.90 35.17% 38.29% Chobe 2.10 2.60 23.81% 26.66% Imara 6.80 3.25 -52.21% -51.10% StanChart 14.25 8.06 -43.44% -42.13% Barclays 6.67 5.50 -17.54% -15.64% Sefalana 3.21 2.70 -15.89% -13.95% Sechaba 12.85 10.87 -15.41% -13.46% Source: BSE Top Ten Shares by market Cap. Company (BWP Mn) USD Mn) % of Total FNBB 5511.96 836.72 21.00 Barclays 4712.45 715.35 17.96 Letshego 3406.63 517.13 12.98 BIHL 2956.86 448.85 11.27 Standard Chartered 2386.76 362.31 9.09 Sechaba 1429.91 217.06 5.45 Engen 1022.22 155.17 3.89 Wilderness 1009.47 153.24 3.85 Furniture Mart 667.6 101.34 2.54 Turnstar 547.85 83.16 2.09 Source: BSE DCI relative to the S & P Africa Frontier Index 1.30 1.20 1.10 1.00 0.90 0.80 The Bank Rate was maintained at 10% during most of 2010, with a bank rate cut of 50 basis points coming in mid-December 2010. The average prime lending rate of commercial banks was constant at 11.50% between December 2009 and mid December 2010. The yield on the 14-day BoBC decreased from 7.10% at the end of December 2009 to 6.56% in December 2010, while the 3- month BoBC yield also eased to 7.15% in the same period from 8.20%. Jan-10 Feb-10 Aug-10 Jul-10 Jun-10 May-10 Apr-10 Mar-10 S&P African Frontier Index Sep-10 Oct-10 DCI Nov-10 Dec-10 3
During the year the market had 2 new listings while 3 companies delisted. Cresta and Wilderness Safaris listed Market Review for 2010 on the domestic board during the first quarter, while Sefcash delisted during the third quarter. On the foreign board DiamonEx was delisted after having been put under judicial management while African Diamonds delisted towards the end of the year after a successful takeover by Lucara Diamonds. A NewGold ETF was listed during the second quarter, making in it the 1 st EFT to be listed on the Botswana Stock Exchange. The DCI started the year on a positive note climbing to 7,702.04 points in February 2010 after having begun the year at 7,241.56 points. The index experienced some volatility during the Q2 2010 and Q3 2010 before taking a nose dive to levels last seen in July 2009 (6,400 points) driven mainly by the financial stocks. Stanchart, Barclays, and FNBB ended the year down 43.44%, 17.54% and 11.60% respectively. It was however not until December 2010 that the domestic index reached its lowest levels for the year at 6,368.95 points. The net result was that the DCI ended the year down 11.45% at 6,412.94 points, or -8.26% in USD terms. The FCI started the year relatively flat, hovering around the 1,400 point mark. During June 2010 the foreign index jumped 206.13 points to close at 1,616.25 points on the back of a 5.16% gain by Discovery Metals. A total of 308.66m shares exchanged hands during the year generating a turnover of USD 149.52m. The last quarter experienced the highest level of activity with 137.95m shares having been traded, generating a turnover of USD 49.85m. Letshego dominated the year’s volume and turnover with a 68.94% and 54.88% contribution respectively. 10 Most Active Stocks by Volume Company Vol. (Mn) % of Total Letshego 212.80 70.26 FNBB 18.91 6.24 Barclays 13.14 4.34 Turnstar 10.63 3.51 Sechaba 10.09 3.33 PrimeTime 9.58 3.16 FSG 8.22 2.71 BIHL 6.36 2.10 ABCH 4.27 1.41 Sefalana 2.96 0.98 10 Most Active Stocks by Value Company Val. (USD) % of Total Letshego 80,201,630 55.61 Sechaba 17,039,531 11.81 Barclays 13,564,273 9.41 BIHL 9,436,564 6.54 FNBB 7,492,331 5.19 Turnstar 2,792,749 1.94 FSG 2,580,806 1.79 PrimeTime 2,532,883 1.76 Standard Chartered 1,972,724 1.37 Sefalana 1,495,945 1.04 Market Cap Composition 24% 10% 50% Banking Property Hotel 6% 6% 4% Brewery Financials Other 4
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Page 3: EQUITY RESEARCH AFRICA FEBRUARY 201
Page 7 and 8: EQUITY RESEARCH BRVM FEBRUARY 2011
Page 9 and 10: EQUITY RESEARCH GHANA FEBRUARY 2011
Page 11 and 12: Market Outlook for 2011 Top Picks f
Page 13 and 14: Market Review for 2010 The Nairobi
Page 15 and 16: Market Outlook for 2011 No surprise
Page 17 and 18: Market Review for 2010 The Stock Ex
Page 21 and 22: Market Review for 2010 In the midst
Page 23 and 24: EQUITY RESEARCH UGANDA FEBRUARY 201
Page 25 and 26: EQUITY RESEARCH ZAMBIA FEBRUARY 201

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