Business
Corporate deals to stir dull market
Publish Date: Nov 07, 2012
Corporate deals to stir dull market
UMEME MD Charles Chapman shares a moment with Charles Mbiire of Uganda Securities Exchange during launch of UMEME IPO at Serena Hotel last month
  • mail
  • img
newvision

By David Mugabe

The stock market should see better days ahead with anticipated major corporate activities  expected towards year end and beginning of new year.

The biggest is the Umeme initial public offer (IPO) and listing scheduled for November 30, 2012. Umeme’s offer at sh275 should stir up the market that is devoid of activity even though analysts viewed the price offer as being high for an IPO.

The other is Kenya supermarket chain Uchumi which has indicated it will cross-list in Uganda and also do the same in Tanzania and Rwanda in December. 

According to reports quoting Uchumi chief executive Jonathan Ciano , once they receive a go ahead from the regulator, they will register and cross-list on Uganda, Tanzania and Rwanda stock exchanges over the counter market. Should this be achieved, this will give the market a major push.

The other corporate action is the National Insurance Corporation (NIC) rights issue that the insurer wants to undertake to shore up its working capital as required by the Central Bank. NIC is also awaiting regulatory approvals following the resolution passed by the shareholders last week.

The above three activities should light up a market that on Tuesday recorded no single trade.

“There should be some upturn and activity towards year-end, but we wait to see whether this can be sustained,” said one market analyst.

On the market, despite a whooping offer of more than 3m Stanbic shares, this was not marched by the 2.9m shares bidding shares citing a price mismatch. Stanbic is trading at an attractive sh20 per share.

There were also other offers of over 100,000 shares on the NIC counter and another 122,000 on the Uganda Clays (UCL)counter that were not taken up. The rest of the companiescounters remained mute with neither demand nor supply. 

There are currently 14 local and cross-listed companies on the stock exchange and should Umeme and Uchumi enter the 14 year old bourse would be a more diverse market but still struggling with liquidity and a failure to attract the mid-level companies especially the small and medium sized enterprises.

The statements, comments, or opinions expressed through the use of New Vision Online are those of their respective authors, who are solely responsible for them, and do not necessarily represent the views held by the staff and management of New Vision Online.

New Vision Online reserves the right to moderate, publish or delete a post without warning or consultation with the author.Find out why we moderate comments. For any questions please contact digital@newvision.co.ug

  • mail
  • img
blog comments powered by Disqus
Also In This Section
Dr Maggie Kigozi: Obstacles in businesses are jewels
Dr Maggie Kigozi, director Crown Beverages Ltd has challenged the youth to consider obstacles in starting and running businesses as opportunities to create better lives....
How to widen Uganda’s tax base in a large subsistence economy
Uganda’s tax base remains small and the country is grappling with measures on how to widen the tax base in light of decreasing donor funds and pressures to finance the national budget....
UAE Exchange Uganda observed World Food Day
UAE Exchange, the leading global remittance, foreign exchange and payment solutions brand observed World Food Day on 16th October. This year the theme was Family Farming: “Feeding the world, caring for the earth”...
Nigerian cleric warns Uganda over oil curse
Rev Father Edward Obi, a leading civil society activists fighting against the effects of the oil curse in Nigeria has warned Uganda that since oil has been discovered Ugandans are not safe from the negative effects the resource brings....
Oil to spur capital markets – Nsamba
This year marks 18 years since the Capital Markets Authority (CMA) was formed....
UBOS releases Producer Price Index
THE indices for hotels and restaurants indicate that annual prices for hotel services fell by 2.5 percent during the period of April, May and June 2014, compared to the same period in 2013...
Should the absence of bride price prevent couples from wedding?
Yes
No
Can't Say
follow us
subscribe to our news letter