Dar equities market plunges 34.2 pct to 49bn/- in H1, 2023

Tanzania’s stock market fell by 34.2% to 49.09bn/- during the first half of this year as compared to 74.5bn/- that was recorded during the same period last year.

According to data from the DSE, during the first half of 2022, the country witnessed an unprecedented scale of stock sell-offs by foreign investors along with minimal investment activity on the buying side.

However, local Tanzanian investors rose to the occasion with increased participation and dominated both sale and purchase activities in the market for an extended period until June, with May being an exception due to three foreign book transfer transactions.

Additionally, there was a substantial decline in traded share volumes within the market – plummeting by 43.07% to reach 53,044,797 shares compared to 93,175,415 shares traded during the corresponding period in 2022.

Among all traded counters, CRDB emerged as the most active counter, accounting for 77.17% of the total volume. It was followed by NMB (5.35%), TBL (4.14%), NICO (3.23%), and other counters (10.10%).

According to the Alpha Capital Market report for the first half of 2023, corporate earnings and dividend announcements significantly bolstered stock market prices performance, particularly the 4Q, 2022 earnings reports.

“The strong financial results from prominent banking institutions such as CRDB Bank and NMB Bank contributed to a substantial increase in domestic market capitalization, which soared from 10.3trn/-  to 1.05trn/- on April 21st, 2023,” the report shows

The report shows that however, the market subsequently experienced a correction and declined to 10.8tn/- by June 30th, 2023 as investor’s cash in after dividend payments.

During the first half of the year, the Tanzanian Stock Index (TSI) experienced a fair surge of 5.22%. This upswing can largely be attributed to the outstanding performance of banking and investment stocks (BI), which recorded a remarkable 16.11% increase during this period.

Industrial and allied stocks (IA) followed suit, albeit at a more modest pace, posting a gain of 1.68%. Commercial service stocks also faired reasonably well, registering a minimal gain of 0.35%. Upon examining these results from an annual perspective, domestic companies included in the TSI posted a4.2% increase, further emphasizing the ongoing strength of the banking and investment sector. This sector continued to fuel overall gains, climbing 12.3% on an annual basis.

This progress was largely attributed to the price appreciation of both NMB and CRDB stocks, two major components in the BI index.

In contrast, we observed a decline in the All Share Index (DSEI), which dropped by 4.35% during the first half of this year.

Various factors contributed to this decline, including numerous fluctuations within share prices for cross listed companies, KCB shares plummeted a staggering 32.39%; East Africa Breweries Limited (EABL) shares dipped by 19.50%; and Jubilee Holdings Limited (JHL) experienced a downfall of 19.46%.

However, amidst this downturn, Nation Media Group (NMG) – was the only cross-listed stock presenting an upward trajectory – gained 10.00% following the announcement of its share buyback program. When considering these figures within an annual context, we can see that DSEI has diminished by an overall rate of 4.0%, revealing a correlation with decreased cross-listed counter prices.