Dar bourse registers fastest growth in EAC

Mr Gupta
The Dar es Salaam Stock Exchange (DSE) is ahead of other East African bourses, securities experts say.

The DSE leads others by introducing second segment market that target start-up companies, especially Small and Medium Enterprises (SMEs), which have been left out from the main markets due to stringent conditions.

The Kenya’s Standard Investment Bank Director of Corporate Finance, Mr Amish Gupta, said the SMEs are one of the important segments for propelling the economic growth but they normally lack capital.

“DSE has a good platform for growing larger as the mining sector, telecoms can be tapped to (Enterprise Growth Market (EGM)),” Mr Gupta said on the sidelines of the investors briefing session on Kenya Airways (KQ) right issue.

The Director said EGM encourages SMEs to go to DSE for funding, a move that makes them benefit from experience of running and keeping books as per the bourse standards. He was speaking in Dar es Salaam on Tuesday.

“This will also push the bourse’s market capitalization and contribution to GDP,” Mr Gupta who flew from Nairobi to Dar es Salaam to present KQ’s “Project Mawingu” to investors, said.

Data shows that DSE’s market capitalisation as a percentage of GDP is 12 per cent compared to 41 per cent of Nairobi Stock Exchange (NSE).

This means DSE market capitalisation grows by one per cent yearly. It started operations 12 years ago.

Mr Shirima
Tanzania Securities Chief Executive Officer Moremi Marwa said the reason behind was limited supply as in the last 12 years only 10 companies were listed on the Dar bourse.

“Lack of liquidity also contributed to the small contribution to GDP as market turnover ratio is merely 2 per cent compared to 14 per cent of Kenya,” Mr Marwa told the ‘Daily News’ yesterday.

Kenya, the oldest stock exchange market in the bloc has no EGM segment and left most of the companies relying on the main markets thus blocking out the SMEs into tapping the market.

Uganda Securities Exchange and Rwanda Over the Counter also have only main market.

The Capital Markets and Securities Authority (CMSA) said last month that the operation of EGM will start after sensitizing the public and investors, later this year.

CMSA’s Manager for Public Relations Charles Shirima said: “Four applications were received and in the mean time the process of issuing licence to the potential advisers is on the final stage.”

Mr Shirima said the authority has received a number of inquiries from potential investors even before the alternative market has started to operate but hesitated
Source: The Daily News,

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