Wednesday, June 7, 2023

While BTCL IPO is stuttering, consider investing with Afinitas

The recent announcement by one local company, Afinitas that it will soon list its shares at the Botswana Stock Exchange is good news that cannot be celebrated once and be swept under the carpet. For a capital market such as ours which has for a very long time been characterised by comparatively low liquidity, the arrival of one or two companies at the bourse is worthy the noise. This is so because our people still drag their feet when it comes to investment or participation in the capital markets while the arrival of any company revives debate around stock investments.

Critics have often described the stock market as the ‘rich club’ with a number of Batswana in the countryside locked-out as institutional investors run the show by buying and keeping stocks and, as a result, drying liquidity. Although lack of financial education has often been another stumbling block with rich cattle owners deciding to keep the status quo, of late, we have seen slight change in locals expressing interest in learning one or two things on capital markets investments. As such when companies such as Afinitas decide to go public, it gives those in-the-know yet another opportunity to educate our people on this rather new concept of wealth creation (atleast to most Batswana).

Afinitas, as seen in one of the stories we published elsewhere in this edition is a green field investment company incorporated in Botswana, which opened its initial public offering (IPO) late last month in a bid to raise atleast P28.8 million from the local bourse. The ultimate aim is to raise the money and reinvest it across various markets in Africa ÔÇô atleast according to one of its directors, Leutlwetse Tumelo. Other directors of Afinitas according to the company prospectus include property magnate Lesang Magang, Dawn Pickering and managing director, Rupert McCammon.

The new pan African focused investment firm eyes to make various other investments in industries such as financial services, insurance companies, leasing companies, fund management companies, deposit taking companies and lending companies.

Clearly, as things are now, Afinitas will start trading its shares before the much anticipated arrival of BTCL at BSE. As we all might be aware, the privitisation of BTCL and subsequent listing on the local bourse has long been overdue. Sometime in February last year, the Public Enterprises Evaluation and Privatization Agency (PEEPA) which is tasked with the role of turning state companies into private entities went on record to say the opening of the BTCL IPO will be in August 2014. We are roughly two weeks away from August 2015 and there is no single hint of the BTCL IPO calendar being released any time soon.

Unlike BTCL, Afinitas, which recently concluded a P90 million private placement, has already been granted regulatory approval to list 240 million ordinary shares on the Venture Capital board of the BSE.

The anticipated listing of Afinitas at BSE comes at a time when household indebtedness is a big debate, and the BSE has previously has conceded that it is institutional investors, precisely Pension Funds, that crowd the tiny bourse. This, therefore, stifles small investors, a group that is normally blamed for lack of investment and savings culture.

For some time now we have witnessed an increased gap between borrowing and saving in the country, which was previously made worse by lack of investment avenues for individual investors. But the decision by companies such Afinitas, Choppies and all other who recently went public (or aspire to go public like BTCL) present Batswana with another alternative to be players at the stock exchange.

Our people should always remember that the BSE, although popular in Gaborone, an area populated with more literate people as compared to the rest of the nation, is open to all investors; large and small. As such when companies such Afinitas come and make their case, fellow citizens seek appropriate professional guidance and consider buying shares if the need be. At this stage, no one knows when those who are behind BTCL IPO will finally let go, so while waiting, here is another opportunity presented by a local company.

However, when all is said and done, the #Bottomline remains that the pending trading of both BTCL and Afinitas shares on the BSE presents a rare opportunity for Batswana to stop being economic spectators and become active players even on capital markets. So while the BTCL IPO stutters, our people should go out and buy the Afinitas shares or any that are available lest their money lose value.


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