JATU, an agri-industrial based start-up firm, shares appreciated by 24 per cent in the first trading week after listing on Dar es Salaam Stock Exchange (DSE).
The start-up, listed on DSE's alternative market last Monday, closed the week at 520/- after gaining 460/- minutes after being listed on the bourse. The listing price was 420/-.
Jatu, which hadn't gone through an IPO, its share demand is puzzling stock market analysts since they failed to pinpoint the source of demand.
Analysts, however, said it was too early to determine the share trading and price pattern since Jatu listing skipped the initial public offer.
Tanzania Securities said in its Weekly Blast Market report that Jatu was one of the active counters last week and the same was expected this week.
Zan Securities said Jatu, the newly listed company, boosted the performance of the domestic equity market last week as indices went up.
“We expect a return of block trades next week and, therefore, an increase in volume and turnover,” Zan said in its weekly market wrap-up. DSE weekly total turnover plunged by 83.8 per cent to 740.6m/-.
DSE Insight, unofficial bourse twitter account, said it was hard to really understand Jatu share patterns.
“They didn’t go through an IPO process and the value is so low, not a lot of money can move the price. We will just have to wait and see how the market responds,” DSE Insight tweeted.
The firm, which was listed on the bourse last Monday, saw its share rallying to 460/- on the first day of listing from 420/- when the bell was rung.
Orbit Securities Head of Research and Analytics Imani Muhingo said mid-last week share rallying on the first day was not an immediate indicator of the firm’s trading pattern.
“It’s tricky to analyse Jatu’s share pattern at the moment to establish if price prop-up is driven by demand. If the firm had gone through IPO and oversubscribed, we could have easily said those left behind were buying at the secondary market,” he said.
Orbit Securities said on Monday on its Weekly Market Synopsis that both indices painted green for the week to last Friday as a result of increased equity prices during the week.
“The domestic market cap was lifted by CRDB, Nicol and Jatu, which all experienced appreciated prices,” Orbit said.
The Tanzania Share Index (TSI) gained 6.55 points as a result of a 0.2 per cent increase in domestic market capitalisation. All Share Index (DSEI) increased by 0.20 per cent to close at 9,147.70 points.
The TSI and domestic market cap closed the week at 3,482.97 points and 9.147tri/-.
Both, CRDB Bank and Nicol’s, went up by 2.78 per cent to close the week at a price of 185/- for both counters.