(AFRICAN MARKETS) -- As the entire country is at the edge of their seat, awaiting further news from the listing of Telecom companies, a rather silent prospectus attempts to solicit the pockets of Dar investors. TCCIA Investment Company limited, now TCCIA Investment PLC has finally completed all its paper work and is soon to begin its odyssey towards public trading. TICL will be conducting its Initial Public offering next week on February 1st 2017.

TCCIA Investments aims to raise TZS 45 billion and double its asset value from the selling of 112,500,000 shares valued at 400/- each. The company is poised to be the first investment company to list on the Tanzanian exchange. The IPO is scheduled to last 45 days running from the 1st February to 14th March 2017. The company is expected to be fully publicly tradeable after the 24th April 2017, with a Market Capitalization of 73bn/-.

The TCCIA Investment PLC (“TICL”) was incorporated on 9 November 1999 under the sponsorship of the Tanzania Chamber of Commerce, Industry and Agriculture [TCCIA] in an effort to expand its financing sources. The Chamber floated the Company as an internal IPO and in the early days restricted the buying of shares to the Chamber and its Regional branches.

The company started off small with relatively low capital and got its first major break, when the government shortlisted the company to participate in the privatisation of the National Microfinance Bank (NMB). The company has since diversified its assets and is operating as a Closed-ended investment Company which currently exclusively trades on the Dar-es-salaam stock exchange.

They company really gained traction in 2005 almost 6 years after incorporation, when the firm attempted to raise capital and seeked to self list, however, due lack of experience and its limited track record, the company did not qualify. Nonetheless, the company conducted a private IPO and the journey has still been adventurous. Twelve years ago, the company had capital base of just 2bn/- which today has grown to approximately 32bn/-. The company has continued to push through and has come a long way considering it is still only being managed by 4 individuals.

The company does exclusively depend on listed securities and its performance is directly linked to the economy’s performance. Though the company has provided almost a 139% cumulative average growth return since 2011, there are skeptics that fear that the company share value will not be as strong post IPO. The company’s profitability is not as high as many local investors want and the low earnings may give some investors cold feet come the day of the IPO.

In 2015 the company raked in a revenue of 1.369bn/- slightly down from 1.393bn/- in 2014. The company’s profit before tax stood at 564m/- in 2015, down from 784m/- in 2014. The low profit value does raise an eyebrow towards a bearish outlook, however, once listed, the company believes it will be able to quadruple its revenue and profit. TCCIA uses its own index to gauge its performance and at the end of March 2011, rebased the TICL index to 1,000/-. Since then the value has soared vastly outperforming the Dar-es-salaam All Share index and is currently valued well over 422% than it was 6 years ago.  

I am very bullish on the stock as the capital injection will help curb inefficiencies in their operation and more importantly allow them to potentially participate in the Telecom IPOs. Irrespective of the IPOs, the 50bn/- cash injection could most importantly allow them to diversify their operations. Large capital will allow them to bid on treasury bills and also obtain better fixed deposit rates to create a stronger safety net for their investors.