Tanzania's stock brokers gain as DSE turnover increases

The Dar es Salaam Stock Exchange (DSE) turnover has increased by 2.5 per cent to push up stakeholders gains in this year’s second quarter.

The turnover increased from 278bn/- in quarter one to 285bn/- in quarter two, despite domestic market capitalisation drop of 3.0 per cent.

‘Daily News’ computation taking the lowest commission fee of 0.8per cent, times the total turnover of the quarter, shows that stock brokerage firms pocketed at least 2.28bn/- in transaction fees.

When the amount is divided equally to the ten licensed brokerage firms, each pockets 228m/- per quarter or some 76m/- per month.

However, the amount may not be exactly the same as share sale has three commissions depending on amount transacted.

According to DSE, commission for less than 10m/- is 1.7 per cent, next to 40m/- is 1.5 per cent and above 50m/- is 0.8 per cent. On the same note, DSE has made some 798m/- in the second quarter or 266m/- each month. DSE receives commission of 0.28 per cent.

The DSE Second Quarter report shows that domestic market capitalisation decreased by 3.0 per cent from 10.2tri/- at end of March to 9.9tri/- as of end of June.

“This is a reverse to a similar situation in quarter one of 2015 versus quarter four of 2014,” the bourse chief executive officer, Mr Moremi Marwa, said on the report yesterday. “DSE recorded a decent quarter two performance, albeit with mixed outcomes....,” he said.

The domestic market cap decline is partly attributed to the depreciation of shilling which had a negative impact on investors’ returns, as measured in greenback. 

As a result, the report shows, foreign investors’ activities fell from 91 per cent to 86 per cent on the buy-side and from 77 per cent to 41 per cent on the sell-side from previous quarter to this quarter respectively.

The DSE Index - measuring total market capitalisation - recorded a growth of 5.0 per cent, from 22.7tri/- at the close first quarter to 23.9trio/- at the end of second quarter.

The DSE top priorities during the coming quarter include introduction of mobile and internet trading in bourse platform and encourage more listings.

Others are public education and awareness, integrating and synchronising DSE Central Securities Depository (CSD) to that of Bank of Tanzania (BoT) for government bonds trading.

The bourse demutualisation processes is now at the advanced stage and expect IPO and self-listing by end of next year quarter one.

The demutualisation initiative aims at enhancing our governance structure, provide DSE with efficient financing options for its future growth and also increase DSE’s capability to respond effectively on current and future market needs.
Source: Daily News, reported from Dar es Salaam, Tanzania
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