Leading brokerage firm, Motswedi Securities announced that Botswana Telecommunications Corporation Limited (BTCL)’s share price was stable in March, as it closed the month firm on its opening price of 90 thebe per share.
According to data compiled by Motswedi’s Head of Research Garry Juma and analyst Salome Makgatlhe, for the month of March, 1.48 million shares changed hands with a value of P1.33 million made as turnover. According to the duo, the trade was a decrease from the previous months, where 2 million shares were traded worth P1.84 million.
As the quarter ended on the 31st March, BTCL registered its third consecutive quarter on quarter loss – the latest quarter amounting to 5.3 percent in losses. “However, it is encouraging to note that since listing, this is the smallest quarterly loss BTCL has endured and most of these losses were incurred in February 2019 alone,” said Motswedi researchers.
For the month, the total market’s turnover increased from P86.84 million to P108.56 million. However, BTCL’s contribution to the market liquidity fell to 1.2 percent from 2.1 percent in the previous month. In terms of quarterly participation, Motswedi Securities said BTCL was less liquid for the just ended quarter, with a total of 4.8 million shares with a value of P3.10million having been traded. The entire market traded P318.69 million worth of shares during the same period.
Motswedi analysts said this was a slight step back from the previous quarter’s 4 million shares that traded with a value of P4.29 million.
BTCL’s share price has kept at 90 thebe for the month under review. Part of the reason according to the brokerage firm is an active demand for BTCL shares. They further noted that the influx of sellers that had put pressure on the price in the previous month was abated by an increase in buyers in the market.
“The trend that has established itself in the market in the history of BTCL’s listing, is that investors find the share price of BTCL desirable when it falls to 90 thebe or below. As such the share price has held at its 12 month low price.”
Juma and Makgatlhe also said BTCL has a history of declaring a large dividend payout with its full year financial results. In 2017, the company declared 11.09 thebe to its investors, in 2018 the company declared 9.70 thebe, and investors are now looking forward to a similar outcome, according to the duo. BTCL is on a closed period, which in simpler terms means that the Board members of BTCL, the staff members of BTCL and their immediate families are not allowed to transact in the company’s shares, up until the full year financials of the company are released. The results are expected before the 30th June 2019.
Motswedi analysts said the company has a good dividend payout policy which states that the telecommunications giant will payout between 50 percent- 65 percent of earnings subject to the financial position of the company.
Given this, they said investors will be holding out on selling in anticipation of the dividend payment expected with the release of the full year financial results. “Against this background we expect some continued stability in the share price of BTCL pending the release of the financial results.”