CRDB shares make quick gains

CRDB shares which hit the lowest level this year, have made a  quick comeback after appreciating by almost 14 per cent in less than three weeks.

According to Dar es Salaam Stock Exchange data, CRDB, gained tremendously in the last three weeks to close Tuesday trading at 125/- per  share against 110/- that was registered at the opening of the month.

Zan Securities Chief Executive Officer, Mr Raphael Masumbuko said on Wednesday that the appreciation was purely based on demand and supply with no basic forces behind the trend.

"There are no fundamental issues behind the appreciation," Mr Masumbuko said yesterday. It is only that sellers have refused to dispose off when the price hit the rock bottom, thus creating a demand ", he said.

He said that the bourse experienced a huge supply and lowered prices again when the share hit 130/-.

"Prices have started to go down again due to high supply," the CEO said. According to DSE report yesterday, the bank share price dropped by 1.60 per cent to 123/- on the back of high supply. This was a result of stockbrokers who still have a number of shares in hand.

CRDB had to dilute its shares before listing them at DSE to give a relative big bonus to shareholders. In return, investors want to sell them at a go hence flooding the bourse and pushed the price down.

At the closing of the market yesterday, the bank counter had 11,425 shares traded at weighted average price of 122.50 ex dividend per share.

In this quarter, Dhow Financial made CRDB share price valuation that showed a fair value of the stock at 260/- a piece after a number of stimulation.

The Financial analyst said that despite investors  shunning CRDB stocks, its earnings per share (EPS) stands at 17/30 at the close of last year's calendar, while dividends offered had been on the rise from 2/- of 2008 to 9/- last year.
Source: The Daily News, http://www.dailynews.co.tz, reported by Abduel Elinaza
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