ZSE chief executive officer Alban Chirume
THE Zimbabwe Stock Exchange (ZSE) is forecasting annual turnover of US$250 million down from US$452,86 million recorded in 2014.
Speaking at the Institute of Chartered Accountants of Zimbabwe (ICAZ) CFO forum ZSE chief executive officer Alban Chirume said as at October turnover was US$203,3 million.
“This year we are forecasting turnover of US$250 million which will be the lowest since 2009. And since we are paid a percentage of that (0,1 percent) our budget for the coming year will be tight,” he said.
This comes after ZSE’s turnover plunged to its lowest in October since April 2009 as negative sentiment on the market continues to widen. Chirume said during the transition period of the ZSE to an automated trading platform, monthly turnover has dropped from between US$30 million and US$50 million to an average US$16 million.
The October figures were the lowest since April 2009’s US$11.62 million, a period which marked the early days of dollarisation. Since 2009 to 2014 monthly turnover has averaged above US$30 million.
Since 2013, Chirume said the bourse has shed off 35 percent of its value but with new processes in place the market is poised for the future growth. He said currently the trading engine is utilising between 2 to 3 percent of its capacity and presents opportunity for growth.
“We have many companies that have potential to list. If we look at the mining or even dairy industries, there are companies that have potential to come aboard,” he said.
Chirume said at least US$326,4 million has been raised on the ZSE through various capital raising options.
He cited the Seedco / Limagrain transaction as the biggest transaction in the last three years while saying companies such as Zimplow also managed to raise capital.
Chirume maintained that the ZSE will have three new listings this year, two of which had already listed: Proplastics and Simbisa Brands.
Chirume said the new listing requirements were now ready and were only awaiting approval adding however that once adopted it could result in some delistings.
“Some companies will not meet the new listing requirement. These we will eventually de-list and take on board new entrants where we are seeing there are opportunities,” he said.
On the Zimbabwe Emerging Enterprise Market, (ZEEM) Chirume said the ZSE is lobbying Government to remove capital gains tax which will make the trading platform efficient.
Commenting on the code of corporate governance Standards Association of Zimbabwe (SAZ) chief executive officer Eve Gadzikwa said acceptance of the code will change the future of Zimbabwe’s economy.
She said while over 3 000 copies of the code have been sold, it has not yet translated to real governance issues.
Gadzikwa said government should speed up the revision of the Companies Act and align it with the national code to allow for stability.
“We should lay out a strong foundation on corporate governance as the economy readies for take-off,” she said. FinX
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