Dar Es Salaam — Trading at the Dar es Salaam Stock Exchange (DSE) has continued to record low performance for the past one week amid high share demand but poor supply.
Trading index has remained glued at 1176.86 points and signs for improvement look bleak, at least for now. Financial experts argue that the negative trend has been contributed by a decision by big investors especially the pension scheme funds, corporate and banks not to sell their stocks as there is no guarantee to secure other products.
But employees, who have steady income have been spending their loans to buy goods like furniture, build residential houses and buy cars. This, according to the experts weakens their saving for future investments.
Rasilimali Limited Chief Executive Officer, Mr Arphaxad Masumbu, said that most investors who depend entirely on salary as their main source of income, show up during Initial Public Offer (IPO) to make quick profit rather than analyzing the bourse trend to make a long term gain.
"Most employees are spenders and they don't save money for investment. This could also be attributed by the fact that they end up in debts as a result of extravagant spending," Mr Masumbu told the 'Daily News' on Monday.
He said that workers are an important segment that could stimulate the bourse trading as business people do not want to invest through a third person. "In most cases, they invest on DSE once in a while", he said.
He said failure to analyze the market is another hindrance for local investors as at the moment. Latest reports from the bourse show that CRDB Bank shares which are at 12 per cent at the moment and sells at 110/-.
The share is expected to gain in the coming months as supply looks dwindling. The Dar es Salaam Community Bank (DCB) is another product with a high yield in near-term.
Its dividend is projected to double this year from 28/- as the bank's net profit is also estimated to improve tremendously. Last year DCB's dividend yield was 20 per cent.
"No other assets can give an investor such a yield and expect to rise in this year," Mr Masumbu said.
Orbit Securities Head of Operations and Dealing, Mr Juventus Simon said there is high demand of shares of CRDB, National Microfinance Bank (NMB), Swissport and cement factories but the supply is short.
A number of shares were not sold last week as there was no supply. "This signifies the share prices increment in near-term", Mr Simon said.
He said that the bourse yield is about 10 per cent per year compared to 7.04 per cent of one-year treasury bills auctioned mid this month.
For quite a long time now, investors have been buying when the share price drops but after analyzing the performance of the share-holding company. Yesterday, all shares index at DSE dropped slightly to 1176.69 points.
No comments:
Post a Comment