DSE turnover drops 70pc in a week

DAR ES SALAAM: THE Dar es Salaam Stock Exchange (DSE) experienced a significant downturn in trading activity for the week of May 13th to 17th, 2024.

The turnover dropped drastically by 69 per cent to 2.36bn/- (USD 911,552) from 7.57bn/- (USD 2.92 million) recorded in the previous week. Correspondingly, trading volume plummeted by 92 per cent, indicating a subdued trading period.

The total market capitalisation decreased slightly by 0.38 per cent, settling at 14.84tri/- (USD 5.72 billion), while the domestic market capitalization fell by 0.48 per cent to 11.71tri/- (USD 4.52 billion). The market indices reflected this downturn, with the All-Share Index (DSEI) losing 6.85 points to close at 1,777.70.

Similarly, the Tanzania Share Index (TSI) declined by 21.56 points, ending the week at 4,422.77. Despite the overall market decline, some stocks showed significant movements.

NMB Bank Plc saw its share price surge by 5.5 per cent, reaching a new alltime high of 5,000/- following the announcement of a substantial dividend increase. NICOL’s stock also performed well, closing the week up by 3.9 per cent.

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However, Tanga Cement (TCCL) experienced a 5.0 per cent drop in its share price, and CRDB Bank Plc saw a significant decline of 12.5 per cent, attributed to the stock now trading ex-dividend. In terms of dividend announcements, NMB Bank Plc proposed a dividend of 361/18 per share for the financial year 2023, marking a 26 per cent increase from the 286/- per share distributed the previous year.

The dividend is scheduled to be paid on or before June 19, 2024, with the last trading day with the dividend (cum-dividend) on June 5, and the shares will trade ex-dividend starting June 6. At the current NMB share price, this yields 7.2 per cent. NMB’s interest income for 2023 exceeded 1.179tri/-, a 24 per cent increase from last year’s 954bn/-.

Interest expenses also rose by 47 per cent, reaching 242bn/-, resulting in a net interest income of 937bn/-, up 19 per cent. Non-interest income showed a strong 15 per cent year-on-year growth, amounting to 468bn/-.

This was primarily driven by a 20 per cent increase in foreign exchange dealings and a 13 per cent rise in fees and commissions. Non-interest expenses grew by 10 per cent to 546bn/-, with salaries and other operating expenses increasing by 11 per cent and 10 per cent, respectively. Fees and commission expenses, however, declined by 14 per cent.

Overall, operating income surged by 26 per cent to 775bn/- , while profit after tax reached 545bn/-, also reflecting a 26 per cent growth. In 2023, the bank opened over 1.2 million customer accounts, expanding its base to 7.1 million. It invested 6.2bn/- in education, health, and climate projects.

With Tanzania’s 61 million population, half unbanked, NMB has a unique opportunity for growth. Swissport also announced a dividend of 51/33 per share, offering a yield of 5.1 per cent at current prices, representing a 21 per cent increase from the 40/- per share paid last year.

Swissport released its audited financial statements for 2023, showing a 7 per cent increase in revenue to 40.9bn/-. Despite a 4 per cent rise in operating costs to 35bn/-, the company achieved a net profit of 3.7bn/-, a 42 per cent increase from the previous year.

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Twiga Cement released its Q1 2024 results, showing a 24 per cent decline in revenue to 103bn/- and a 34 per cent decrease in profit after tax to 16bn/- compared to the corresponding quarter in 2023. Investor participation showed a balanced interest from both local and international market participants, with 49 per cent of turnover from domestic investors and 51 per cent from foreign investors.

Looking ahead, a 15-year government bond with a coupon rate of 13.50 per cent is scheduled for auction on May 22, 2024. Current yields for Treasury Bills range from 5.93 per cent for 35-day T-Bills to 8.61 per cent for 364-day T-Bills.

Treasury Bonds yields for various tenors are as follows: 2-year at 11.64 per cent, 5-year at 10.09 per cent, 7-year at 9.71 per cent, 10-year at 12.30 per cent, 15-year at 13.66 per cent, 20-year at 15.24 per cent, and 25-year at 16.13 per cent.