HomeBusinessBargain hunters prey on Zim Stock Exchange

Bargain hunters prey on Zim Stock Exchange

An analyst attributed this development to latecomers beginning to buy Zimbabwe assets from companies that are realising profits.
Since January, ZSE has witnessed six special bargains with buyers on the stock market purchasing huge chunks of shares at a special price agreed by the seller.

In most cases, the prices were at a premium of the prevailing trading price.

The special bargains come at a time analysts have forecasted rich pickings in the first quarter buoyed by the expected continued general economic recovery despite the threats of indigenisation implementation.

In January, 120 million Meikles Limited shares were bought at 17,5 cents in a deal worth US$21 million.

It came after two special bargains on January 10 when 394 369 Hippo Valley shares were bought at 110 cents each while Padenga’s eight million shares were bought at 5,6 cents each.

Last Wednesday 370 000 Econet shares were bought at 360 cents each by MMC Capital while 2 516,243 Delta shares were sold at 70 cents each.
On Monday, there was a special bargain of 42 798,497 Afre shares at 18,42 cents each as the National Social Security Authority (NSSA) completed its deal to acquire a significant stake in Afre.

A foreign buyer bought 24 686 561 Delta shares valued at about US$17 million in a “book over” deal.

A book over is when the broker has both the buyer and the seller in his/her book.

Since the beginning of the year, the stock market has witnessed six special bargains which analysts attribute to a host of issues such as investors rationalising their portfolios and foreclosing when loans have gone bad.

In 2011, ZSE recorded 75 special bargain deals valued at about US$101 million, the highest since dollarisation and analysts predict at this current rate, it will be surpassed.


Analysts predict improved first quarter gains


Analysts have predicted an improved first quarter compared to last year.

Kingdom Financial Holdings Limited (KFHL) said ZSE will record some gains in the first quarter of 2012 as most companies will release their results during the period.

KFHL said the environment “will be more favourable politically given that electioneering will likely be delayed to the second half of the year”.

It recommended that investors target growth stocks with positive earnings expectations and manageable debt levels. “Better financial performance by listed counters on the back of improved turnovers due to higher capacity utilisation, improved liquidity (diamond and other mineral exports) and continued support by foreign investors are some of the fundamentals that will support stock market prices,” KFHL said.

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