November weighed down the ZSE as the exchange lost 6.42% in the month. In what was an active month on the capital markets with the inaugural Financial Markets Indaba Capital market awards, the complexity of the share consolidation of Medtech, the introduction of Medtech B shares and the delay of Tanganda’s unbundling from Miekles, The oversubscription of the Caledonia offer on the Victoria Falls Stock Exchange and Masimba announcing further unbundling of Proplastics. The market was mainly weighed down by losses in heavyweights with small-cap stocks dominating the gainers.
Medtech lead the gainers after its complicated restructuring process. The B shares were introduced at ZWL$0.01 per share hence the unbelievable percentage gain. Medtech A, which are the direct descendants of Medtech shares as we knew them gained 42.63% in the month (after applying the 253.313739 to the shares at the start of the month). Finsec listed Old Mutual Zimbabwe Limited (OMZIL) made a surge in the last 2 trading days to just under ZWL$100 to record a 40.83% gain in November. In total there were 22 gainers (including Medtech B and OMZIL). The rest of the top ten gainers included Edgars (31.32%), a resurgent CFI gained 21.89%, Mashonaland Holdings (17.96%), Fidelity (17.94%), Zimplow (16.86%), (NTS 11.43%) and Getbucks (10.97%0 in the face of the looming capital requirements deadline for banks.
Meanwhile, the exchange registered 28 losers in November. Chief amongst them was African Sun (-36%) which will likely see further losses with concerns of new travel restrictions to combat the new Coronavirus variant and the sudden uptick in numbers in Zimbabwe. Heavyweights also featured prominently in the losers with Miekles (-22.81%) dropping after the delay on the unbundling of Tanganda as they negotiated over tax implications of the transaction, Econet she 18.69% and OK Zimbabwe losing 17.56% after a less than stellar half-year report. The rest of the bottom 10 comprised of First Mutual Properties (-34.92%), Axia (-25.03%), Star Africa continued its slide losing 22.98%, Willdale (-22.02%), Unifreight (-17.81%) and General Beltings Holdings (15.95%). 7 of the top 10 counters were in the negative with Simbisa (-11.68%), Innscor (-9.92%), CBZ (-5.55%), Delta (-1.92%) and BATZ (-1.46%). SeedCo International (VFEX) also registered losses of 0.14%. During the month there were 4 non-movers led by the usual suspect ZECO, Padenga (VFEX), CAFCA and Zimpapers.
The Indices show us that the top 10 and medium cap counters weighed down the exchange most. Small Caps actually rallied impressively but to no avail. The market has only recorded one other month of loss this year in August (-3.70%) with double the loss at 6.42% for November. The biggest loss of the year comes hot on the heels of the biggest gain of the year. The RBZ’s monetary policy direction gave a warning for this, as we expected the market to take a hit with the contractionary policy.
The ZSE is still in positive territory for the year. December looks to be an exciting month with the delayed unbundling of Tanganda from Miekles, the listing of Caledonia on the VFEX, the further unbundling of Proplastics by Masimba and the switch of Bindura Nickel from the ZSE to the VFEX.