[2008-04-16]  KMAL Leads Zimbabwe Stock Exchange Top Ten
The idea of buying blue chips on the Zimbabwe Stock Exchange is regularly exploited by the fast money crowd and that is not because the companies are fast growers or the most glamourous, but it is because they just keep going up.

On the stock market, blue chip stocks by definition are those large companies who have the resources to survive the setbacks, such as management missteps and economic downturns, which sooner or later strike almost all companies. Sure, blue chips must be large companies, but they must also have additional qualities that ensure they will still be considered blue chips five years down the road.

Analysts use market capitalisation - recent share price multiplied by the number of shares outstanding -- to define company size. The market cap is how much an investor would have to pay to buy all of a firm's shares. If blue chips were ranked based on value or capitalisation, the top ten companies would total 66,6 percent of the $256, 322 quadrillion industrial index worth, using the last prices on April 14.

KMAL led the pack with a market value of $28,486 quadrillion making up 11,11 percent of the index. The group's talks with the RBZ over the potential fungibility of KMAL's share price and quoting it in US dollars are yet to bear fruit. But under the submissions potential investors could "choose" the exchange rate they wanted to value the shares locally. Delta with 11,03 percent of the index and a market cap of $28,297 quadrillion is second and to most analysts is a "screaming buy" and Barclays at $21,484 quadrillion comes in at third. The banking group has always been one of the most consistent performers on the index regardless of how the company could be doing.

Most of the companies have managed to hold their places in the top ten although notably missing is cement maker PPC with a market cap of $6,012 quadrillion but is still the most expensive share on the industrial index at $220 million.

RioZim is the most expensive on the whole at $300 million.


Source: Copyright © 2008 The Herald.