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Local businessman and one of the directors of the country’s only listed teleco – BTCL, Maclean Letshwiti has bought 100 000 ordinary shares of the company. The announcement was made by the company mid this week.
In compliance with the Botswana Stock Exchange Limited listing requirements, the telecommunications company revealed that Letshwiti’s ordinary shares which were bought on 31 July 2019 are valued at P88, 000.00. The shares were sold to Letshwiti at P0.88 per share.
Letshwiti joins another director - Thari Pheko who also purchased 110 000 ordinary shares in mid July 2019. The former Chief Executive Officer of the Botswana Telecommunications Authority (BOCRA), Thari made an on market purchase of ordinary shares valued at P97, 900. 00 on 10 July 2019.
Meanwhile the BTCL stock is expected to continue changing hands amongst Batswana only excluding foreigners at the local capital market. This follows a decision that was taken by the majority shareholder – the Botswana government at the time of listing the company to impose a trade restriction on the stock.
In mid July 2019 BTCL board chairperson - Boakgomo-Ntakhwana said it will take a little while before the current set up is changed.
The comment follows numerous calls to the main shareholder to consider opening the share trading to other market participants including foreigners.
“The major shareholder is warm to the idea, but not yet hot”, Ntakhwana told capital markets community who gathered for the BTCL financial year results this past week.
She however said that the negotiations are likely to take a while before they come to fruition due to an anticipated split at the parent ministry if BTCL – Ministry of Transport and Telecommunications.
During 2018, BTCL – which is the only listed teleco, had its performance becoming the subject of speculation amongst the market players including ordinary shareholders. The company’s stock price went on a rollercoaster plummeting to 0.84 thebe earlier that year and staying below its IPO price of P1.00 for most part of that year and even to date.
At one point during 2018, Garry Juma - a stock analyst at Motswedi Securities broking firm cautioned that the BTCL stock performance going forward will remain volatile due to retail investors who hold bulk of the shares. Retail investors tend not to generally follow any fundamentals.
BTCL’s top six shareholders include the government with its 54.16 percent, Botswana Public Officers Pension Fund with 7.37 percent, Farouk Ismail (0.69%), Debswana Pension Fund (0.63%), Botswana Police Savings and Loan Guarantee Scheme (0.52%) and Motor Vehicle Accident Fund (0.40%).
Other than Juma, local stock analysts have long warned that the trading restriction that was imposed on the BTCL stock will have an adverse effect on the liquidity and price discovery of the company.
Thatayaone Motsomi of Stockbrokers Botswana asserted in 2018 that BTCL is largely traded by retail investors who are primarily concerned with meeting their own liquidity needs hence they believe that selling will continue to outweigh demand.
“We have gotten enquiries from both foreign retail and institutional investors about whether or not the shares will be opened up to foreigners, indicating interest in the stock. If the restriction was to be lifted we believe we would see significant demand for the stock which could drive it towards its intrinsic value,” Motsomi said last year.