mbulelo smpofu
Judith Phiri, Business Reporter
THE Victoria Falls Stock Exchange (VFEX) has achieved a significant milestone, with its market capitalisation soaring to a record high of US$1,3 billion last month.
This represents a 9,3 percent increase compared to the same period last year, driven primarily by introducing new counters and enhanced liquidity of the United States Dollar (USD).
In a VFEX webinar on Market Overview, Portfolio Evaluation and Investment Resolutions 2024/25 last Wednesday, VFEX Business Development specialist, Ms Sandra Munyoro said the number of trades also increased in the period under review.
“The number of trades averaged 1 061 trades per month. The number of trades from January 2024 is 11 670. The VFEX All share index was rebased to 100 basis points on 1 January 2024 and the All Share index increased by 2,19 points to close at 102.19 as at the end November 2024,” she said.
Among the key highlights this year, she said Edgars Stores Limited, a manufacturer and retailer of clothing was listed on VFEX in the second quarter.
The currently listed securities on the exchange are 16 with 12 equity, three depository receipts and one fixed income.
Ms Munyoro said the Contract for Differences (CFDs) were officially launched and started trading on the VFEX effective in May 2024.
“VFEX on boarded its 16th listing on the bourse, Invictus Energy Depository Receipts listed in August 2024. Commodity trading rules were gazette through Statutory Instrument (SI) 148 and 149 of 2024. VFEX issued an expression of interest for commodity trading participants, while trading of Bindura Nickel Mine shares was suspended in May 2024 after its major asset, Trojan Mine, was placed under reconstruction,” she said.
Ms Munyoro said VFEX also collaborated with other market players to establish the Bond Market Association of Zimbabwe (BMAZ) which was launched in the second quarter.
She said following the launch of the BMAZ on 9 April 2024, the BMAZ and the Botswana Bond Market Association (BBMA) signed a memorandum of understanding (MoU) to strengthen the bond markets between Zimbabwe and Botswana.
A bond market is a trading place where various debt instruments are sold by corporations and governments.
These debt instruments, known as bonds, are issued to raise debt capital to fund operations or seek growth opportunities and bond issuers promise to repay the original investment amount plus interest to those who subscribe to the debt instrument.
EFE Securities Equities trader and researcher, Mr George Chirwa said the VFEX was a growing market and new products are likely to increase options for investors.
“Most listed counters on the VFEX have strong cash-generating capacity in USD and good USD dividend payouts. We are also witnessing resilient business models demonstrating sustainable growth prospects, while we are optimistic about ongoing new listings that offer potential for growth and revitalisation for the VFEX,” he said.
He, however, said macroeconomic policy inconsistencies have dampened trading activity on the VFEX, as investors adopt a cautious stance amid uncertainty as well as limited USD liquidity in the economy has led to persistent undervaluation across most listed securities on the exchange.
Launched in October 2020, VFEX, a USD-denominated bourse, is a subsidiary of the Zimbabwe Stock Exchange (ZSE). It was established to kick-start the Offshore Financial Services Centre (OFSC) earmarked for the special economic zone in Victoria Falls.
Online Reporter
