Selestino Babungi (right), the Umeme managing director, speaks during the annual general meeting as Patrick Bitature, the chairperson of Umeme board of directors looks on.
Ali Twaha
Journalist @New Vision

Investors in Umeme booked about sh79b in paper wealth loss at the Uganda Securities Exchange (USE) as its stock price declined in July.

The listed utility firm started off the month with a stock price of sh239 per share.

By close of trading on July 29, the share price dipped to close the day at sh190 per share, representing a 20.5% or sh79b loss in share price valuation for investors.

The decline in stock price valuation came after the company paid shareholders dividends for the year ended December. Shareholders were paid sh54.1 per share.

Market experts say the reduction on stock price could be as a result of investors rebalancing their portfolios amid a tough economic environment.

The July Consumer Price Index released by the Uganda Bureau of Statistics on July 29, shows that annual headline inflation rose to 7.9% in July from 6.8% posted in June 2022.

The spike in global commodity prices at the back of supply-demand imbalances that were caused by the COVID-19 pandemic-related disruptions in global supply chains and heightened by the Ukraine conflict are the main underlying sources to the price pressures.

Umeme is the second most traded stock on the Uganda Securities Exchange after Bank of Baroda over the past three months leading to July.

MTN closed the July trading at a stock price of sh185 per share from an opening of sh178 per share, representing a 3.7% gain during the period under review.

Research from some licensed stock brokers recommended to investors a buy recommendation which has partly kept the stock price steady as relatively investors were trading their shares.

Stanbic Bank recorded a 4.5% loss in shareholders’ value to sh21.

Stanbic has 22,470 shareholders.

Some of the concerns among shareholders on the counter were largely about the slash in dividend payout for the period ended December 2021.

Stanbic paid sh50b as a final dividend for 2021 and sh50b as an interim dividend for 2022.

The bank said they were retaining more cash in order to prepare for a “new cycle of investment in oil and gas”.

By close of trading on Tuesday, nearly all local listed counters had shares on offer (or for sale) from investors, but with limited buyers or bids.

For instance, Umeme had shares worth about sh88m on offer, Stanbic sh6m, Uganda Clays Limited sh16.5m.


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