Tanzania’s first ETF IPO oversubscribed by 36pc

THE capital market has reached a new milestone after Vertex International Securities Limited (Vertex) announced that its maiden Exchange-Traded Fund (ETF) Initial Public Offer (IPO) was oversubscribed by 36 per cent.

An ETF works by pooling investor money to buy a basket of assets, like stocks or bonds that are then traded on a stock exchange throughout the day, similar to individual stocks.

The IPO, conducted under the supervision of the Capital Markets and Securities Authority (CMSA), targeted to raise 5bn/-. However, applications received totalled 6.8bn/-, equivalent to 136 per cent of the target.

The regulator approved the full amount, allowing all applications to be accepted.

Vertex’s Advisory and Capital Markets Manager, Ahmed Nganya, said the oversubscription of the VIS–ETF reflected growing investor confidence in Tanzania’s capital markets and strong appetite for innovative investment products.

“This achievement marks a milestone for both Vertex and the DSE as it demonstrates that Tanzanian investors are ready to embrace new, diversified investment vehicles,” he said. Nganya said several factors contributed to the success of the offer, including the fund’s design, which provides investors with diversified exposure to the market by investing in five top-performing stocks listed on the DSE.

He added that the fund offers an accessible entry point for retail investors, with a minimum investment of only 20,000/-, enabling broader participation in the capital market.

“Not every investor has the expertise or time to select individual stocks. Through the VIS–ETF, investors benefit from professional fund management and risk diversification,” Nganya said.

According to Vertex, the ETF allows investors to own a portion of a professionally managed portfolio that mirrors the performance of selected DSE-listed companies, giving them an opportunity to earn returns linked to the broader market’s performance rather than a single stock.

In a statement, the company said the fund’s listing on the DSE marks an important step toward promoting financial inclusion and expanding investment opportunities in the country.

The VIS–ETF will now proceed to its official listing on the DSE, opening a new chapter in Tanzania’s capital market history as the first locally managed exchangetraded fund.

“We are proud to pioneer this product in Tanzania,” Nganya said. “Our goal is to make investing simpler, safer, and more accessible to all Tanzanians.”

During the primary offer, an economics and financial analyst, Mr Kelvin Msangi said the country’s first equity Exchange-Traded Fund (ETF) deserved a supportive ‘yes’ at the IPO stage, noting that a measured subscription represents both an investment and a vote for a deeper market.

“For first-time investors, the ETF provides a cleaner entry point than stockpicking,” Mr Msangi said, adding the product allows households to own a diversified slice of listed companies through a single trade.