The Dar es Salaam Stock Exchange witnessed a remarkable surge in stocks last week, led by Swissport, a leading cargo handling company, which recorded a 13% increase in its share price.
The stock concluded the week trading at TZS 1,420 per share, marking the first time the stock had reached this range since November 2022. Tanga Cement also put in a strong performance, closing with a 7% rise in its share price. Investors have been active in trading the counter for the past week, speculating on the possibility of its acquisition by Heidelberg Cement, which already owns a majority stake in Twiga Cement.
CRDB, the most liquid counter in the exchange, also saw its share price surge to a new high of TZS 470 per share, representing a 3.3% increase. The impressive fundamentals consistently reported by the bank over time are a testament to its growth and stability.
Twiga Cement gained 3.1% as the stock closed the week at TZS 4,040. The stock has consistently delivered robust financial results and a generous dividend, making it a favourite among investors. NMB’s share price also surged to TZS 3,600 per share (+2.86%), setting yet another new high for the counter.
Year-to-date, NMB remains the top-performing stock at the Dar es Salaam Stock Exchange, having recorded an impressive 80% increase.
The strong performances of these stocks boosted the Tanzania Share Index (TSI) by 46 points, propelling the domestic market to TZS 10.8 trillion.
Despite political unrest in Kenya, cross-listed stocks also performed well last week. KCB stood out with a remarkable 13% increase, recouping some of its previous losses.
National Media Group (NMG) closed 4% higher, while East African Breweries made marginal gains of 0.3%. Unfortunately, Jubilee Holdings was the only stock that closed on a negative note, plummeting by 4%.
Supplemented by robust domestic stocks, the All Share Index (DSEI) gained an impressive 39.85 points, pushing the total equity market cap to TZS 15.8 trillion.
Although stocks performed well, turnover in the equity market dropped by 49% to TZS 675.3 million. The volume of shares traded also fell by 60%, with only 987 thousand shares traded.
This drop can be attributed to the lack of foreign investor participation in the market. Our statistics indicated strong domestic investor participation, with domestic investors accounting for 100% of all share purchases and 90% of all selling activities.
Foreign investors are still reluctant to invest in frontier markets due to elevated risk levels in global financial markets.
However, this situation presents a rare opportunity for domestic retail and institutional investors to aggressively buy high-performing stocks and hold onto them, waiting for market conditions to stabilize before selling them at a profit when foreign participation returns to normal.
GOVERNMENT TREASURY SECURITIES
Last Wednesday, the Bank of Tanzania held a treasury bill auction for tenors of 35, 91, 182, and 364 days.
The 364-day tenor garnered significant demand and interest due to its attractive yields and short tenure, making it a preferred investment instrument for entities such as insurance companies that value liquidity and satisfactory returns.
The Bank of Tanzania aimed to raise TZS 77.2 billion for the 364-day tenor, but investor bids exceeded expectations, totalling TZS 156 billion – resulting in a 102% oversubscription.
The Bank of Tanzania secured all available funds, as all 31 bids for the 364- day tenor were successful. The weighted average yield for the 364-day tenor settled at 6.56%, which is 9 basis points lower than the previous yield of 6.65%.
