Th e a n t i c i p a t e d l i s t i n g o f M o b i l e Telecommunications Limited (MTC) on 19 November will increase the market capitalisation of the Namibia Stock Exchange (NSX) from some N$29 billion to about N$35 billion. This is because MTC is offering over 367 million ordinary shares at prices of N$8.50 each.
The listing Prospectus, released on Monday, also shows selected Namibian institutional investors already provided pre-commitments to subscribe for a minimum of 282 million shares, totalling some N$2.4 billion, ahead of the Initial Public Offering (IOP). This is because MTC aims to raise over N$3.1 billion from the total company, valued at N$6.4 billion.
Brain van Rensburg from PSG Namibia, who formed part of the pre-listing team that determined the much-anticipated share price of the country’s first public enterprise to be listed, yesterday said the eagerly awaited move by MTC will have a significant impact on the NSX. “Shares and equities should be seen as long-term investments,” said Van Rensburg.
“He added that the MTC listing will broaden Namibia’s capital markets as an additional asset has been added,” he told New Era. Also weighing in on the listing, IJG Group MD Mark Spath said “the nature and size of this listing will probably never again be seen in Namibia”. The MD added the equities are a proven investment over the long term.
Spath also advised individual investors to speak to a financial advisor before making major investment decisions. Another local stock brokerage Simonis Storm stated in a communication that it believes evident by pre-commitments, institutional investors will take up the bulk of the share volume. This, Simonis Storm stated, would be a definite boost for the stock – at least in the short-run – and typical for successful IPOs.
“The longer-term view, a bit murky, as we, for starters, would like to know where tangible growth would originate – unfortunately, we do not see it all the way through as per the prospectus e.g., Paratus Namibia remaining a strong competitor within the internet/ fibre (ICT) space locally and the threat of other international competitors (MTN),” the Simonis Storm statement read. Members of the public waiting to become part owners of the country’s oldest and biggest telecommunications company through its IPO, scheduled between 20 September and 01 November 2021, should visit the MTC website, visit their nearest Mobilehome or selected Nampost outlet to purchase their shares.
When MTC board chairman Theo Mberirua recently confirmed the IPO, he assured the public there will be more than enough shares available and encouraged all Namibians to apply and become part owners of MTC. Preference will be given to Namibian retail or individual investors, including customers and staff, during the share allocation process, above institutional and foreign investors.
Recently, MTC stated they have dedicated and trained staff members in all Mobile Homes and selected NamPost outlets countrywide to assist applicants with the completion of application forms. “We encourage prospective applicants to submit their applications as soon as possible when the public offer opens to prevent any potential rush towards the end of the public offer,” said Mberirua. Public Enterprises minister Leon Jooste recently said the first objective of the MTC listing was to develop the country’s financial sector, which is critical for economic development. Jooste added a significant portion of domestic savings leaves the country for international investment outlets.
The second objective, Jooste said, was to unlock maximum value for government as an MTC shareholder and consequently liquidity for the Fiscus. This, said Jooste, demonstrated government’s commitment towards public enterprise reforms – and it is aimed at creating a new mindset as a listed company adhering to international best practices of corporate governance.
“The third objective was to broaden economic participation through ownership by ordinary Namibians in a profitable public entity. The government is encouraging a culture of shared ownership by historically disadvantaged individuals and ensuring broad-based economic empowerment in the retail offer,” said Jooste. What is the stock market? The stock market is made up of exchanges, such as the Namibia Stock Exchange or the Johannesburg Stock Exchange. Stocks are listed on a specific exchange, which brings buyers and sellers together and acts as a market for the shares of those stocks.
The exchange tracks the supply and demand, and directly related the price of each stock. Individual traders in the stock market are typically represented by brokers, including, these days, an online broker. Investors order stock trades through these brokers, who then deal with the exchange on the investor’s behalf. Most investors build a diversified portfolio of stocks or stock index funds and hold on to them for the long run. However, investors like to more actively engage in stock trading, which involves buying and selling stocks frequently in an attempt to time market movements.
These stock traders aim to capitalise on short-term market events to sell stocks for a profit or buy stocks at a low. Some stock traders are day traders, which means they buy and sell several times throughout the day. Others are simply active traders, placing a dozen or more trades per month. Investors who trade stocks do extensive research, often devoting hours a day to following the market. They rely on technical stock analysis, using specific tools to chart a stock’s movements in an attempt to find trading opportunities and trends.
- ebrandt@nepc.com.na