Friday, September 25, 2020

Imara Holdings’ strong results supported by commodities, fund management

Imara Holdings brightened the faces of its shareholders as its half year results shot up 76 percent year-on-year, thanks to a bull run in the commodity markets and an increase in assets managed by its fund management division.
According to the financial results to October 31, revenue jerked up to P 47.7 million against the same period last year, when it was at P 27 million. And at the same time, profits before tax stood at P 16.8 million from P 6 million.

“The group’s strong performance recorded last year has continued during the first six months of the current year. The growth of the African markets has been a major contributing factor and it is gratifying to observe the relatively low correlation between African markets (except Egypt and South Africa), and world markets which helped to dampen short term volatility,” the company said on Friday.
It said Imara SP Reid registered an exceptional period of growth due to strong performance of commodity markets and it was supported by the fund management division, which won a number of mandates of the six months period.

“Our asset management business continues to expand on a solid growth trajectory as it acquires new assets under management from institutional and private investors, helped by the inflows into African Opportunities Fund,” the company said.
The Africa Opportunities Fund, which was listed on the Botswana Stock Exchange late this year, is aimed at luring funds from all over the world into regional economic activities, especially mining.
The fund, which got the Bank of Botswana’s approval recently, is looking at medium term investments within the region, with low risk and an estimated return of about 15 percent per annum.
The fund is looking for investment in low risk African countries and it is projected to register a growth rate of four-to-five percent in the past five years which is supported by a single digit inflationary ratesÔÇöin exception of Zimbabwe ÔÇö and strong performances by their stock exchanges.
It is also supported by the changing political and economic climate in the region.

Some of the most interesting developments are in the mining sector, which is supported by strong demand in the commodity market largely helped by the demands from Asian countries, especially China and India. The moves have resuscitated economies of countries such as Zambia, where a number of mining houses are now looking at the stock exchanges to raise capital.

However, Imara said earnings from its corporate finance division were lower and were affected by the timing of certain mandates.

“The highlight of the period was the listing of Imara on the venture capital board of the Botswana Stock Exchange by way of introduction on October 4. This has not only contributed significantly to Imara’s profile, but has also provided a market and efficient pricing mechanism for Imara shares,” it said.

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