Botswana Stock Exchange Limited (BSE) started the year on a lower note as a trading activity during the first month of the year was below the previous corresponding month.
As of the end of January 2021, a total equity turnover of P32.6 million was recorded from traded volumes of 27.4 million shares.
During the same period last year, a total equity turnover of P37.2 million and a total volume of 17.1 million shares traded were recorded.
The top three traded companies during the period under review were Letshego at P16.3 million followed by Sefalana at P5.6 million, and CA Sales with P2.1 million.
The total turnover from these three companies accounted for 73.8 percent of total equity turnover; with the leading counter Letshego accounting for 50.1 percent of total equity turnover.
In comparison with the same period last year, the top three traded companies accounted for 50.5 percent of total equity turnover with the leading counter Letshego accounting for 21.6 percent or P8 million of total equity turnover.
Speaking during the BSE Opening Bell Ceremony this week, BSE Chief Executive Officer (CEO)- Thapelo Tsheole, said listed companies experienced the challenges brought about by the pandemic particularly on the back of national lockdowns and restrictions in movement.
“Stock markets are usually regarded as a barometer of the economy and it is not surprising that the Domestic Company Index (DCI) declined by 8.2 percent in 2020,” said Tsheole.
Against this challenging backdrop, Tsheole said the BSE’s disposition has been to consistently explore ways of improving the resilience of the domestic capital market.
“While the year ended without any new equity listings, there was tremendous activity in the equity primary market, and in the fixed income market in terms of new bond listings,” he said.
Meanwhile, Tsheole stressed the BSE needs support from the government in several initiatives to grow the market.
One of those is to incentivize companies to list on the stock exchange and Tsheole says most developed, emerging markets and frontier economies have significantly made strides in incentivizing companies that have taken a deliberate decision to issue securities on a stock exchange to promote citizen economic empowerment.
“Such incentives extend to tax and preferential treatment on procurement of services by the government,” he said.
Another support the BSE needs from the government is to position Botswana as the destination for raising capital.
Tsheole said the government has to take deliberate action to position Botswana as a destination for raising capital.
“The model of companies being headquartered or operating in Botswana and expanding to the rest of the continent has been tested as the BSE has a good number of foreign companies listed.”
