[2008-01-07]  Sluggish trade at BSE over festive season
Business was quiet at the Botswana Stock Exchange (BSE) over the festive season as compared to other seasons, a market analyst has said.
“But the dull mood was to be expected because companies had closed for Christmas and New Year holidays and investors had also gone on recess,” said Leutlwetse Tumelo, head of client services at Capital Securities.
There is usually some activity just before the festive season, said Tumelo, as some investors cash-in their shares to spend on holidaying with their families.
“But some see that as a good buying opportunity when there are many sellers because share prices are often reasonable due to competition,” he said.
In share trading, Tumelo said, there is never an opportune or bad time to buy or sell shares as the market is controlled by varying factors.
The BSE, which started with only five listed companies in 2003, has so far listed 31 companies 11 are foreign 20 local.
For a company to list on the main board (domestic equity market) it must have a share capital of at least P1 million and maintain a minimal initial price of P1 per share.
It must also have registered 300 public shareholders plus a satisfactory profit over three years, having recorded P1 million before tax on its last audited results.
A prospective listed company should also submit its latest three financial years’ statements together with a prospectus or a memorandum.
The BSE also caters for start up small and medium enterprises through a listing on the venture capital board where the requirements are less stringent than those of the main board.
They must present a share capital of at least P500 000 and have issued at least one million shares at a minimal share price of 50 thebe per share.
Small companies are not mandated to present a profit history but they should be able to project above average credible returns, while a minimum of five per cent of each class of shares should be held by the public.
Botswana share market started operations in 1989 and was then managed by a broking firm-Stock Brokers Botswana initially as an informal market.
An independent BSE secretariat started operations in 2003 nine years after government had passed the BSE Act.
Source: Copyright © MCST 2006