BTCL share price up 34 percent Owing to“Stampade”

Newly listed Botswana Telecommunications Corporation Limited (BTCL) share price rallied 34 percent year-to-date (YTD), thanks to the good investor reception. By close of trading bells on Wednesday evening, the Paul Taylor-led company traded at 134 Thebe each, a significant jump from the 100 Thebe which the company traded when it commenced on Botswana Stock Exchange (BSE) last week Friday.

Botswana Telecommunications Corporation (BTC) was established in 1980 as a body corporate by an Act of Parliament ( BTC Act) to provide, develop , operate and manage Botswana's national and international telecommunications services.

In 1996, an amendment of the Telecommunications Act repealed the monopoly of BTC and introduced other service providers in the telecommunications arena. 

A Privatization Policy was born in 2000, through which the Government intended to implement a reform programme to improve the efficiency, productivity and competiveness of the public sector.

Following the Government’s decision to privatize BTC, in 2008, the BTC (Transition) Act was passed by parliament to assist the privatization process. Following further liberalization of the telecommunications industry and establishment of a regulatory authority, BTC mobile network, beMOBILE was established in 2008.

The share price exceeded expectations by Motswedi Securities Head Researcher Garry Juma who said last week that within the first six months, he would not be surprised if the share price jumps up to trade at around 115 Thebe each.  In one week’s time, the share price is now at 134 Thebe each.

He said that demand for BTCL shares, as evidenced by a massive over-subscription, could lead to a jostle for its shares, which would consequently push up the share price. There was a “stampede”, for the BTCL shares after the company received 776 333 400 share offer applications against the available 462 000 000, leading to an over-subscription of 314 000 000 shares.

Meanwhile, local equities were subdued as they traded on paltry volumes without any notable counter trading. Share price of the blue-chip micro lender Letshego jumped by 1 Thebe to trade at 252 thebe by Wednesday. However, retail giant Choppies shed 2 Thebe to close the session at 408 Thebe as investors scrutinise the retail giant’s vigorous growth strategy against its relatively higher P/E ratio. Consequently the Domestic Companies Index (DCI) ended three basis points down closing with 10,292.58 points.

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