Dar es Salaam Stock Exchange (DSE) self-list today and brokers are predicting shares to hit the bourse running due to oversubscription during its primary offer.
The bourse primary offer was oversubscribed by 377 per cent in a three-week IPO sold at 500/- a share and prediction points to likely price appreciation at listing day. Orbit Securities General Manager, Juventus Simon, said share price rallying of DSE at day one of listing is imminent due to the huge amount of oversubscription.
"Definitely price will appreciate," Mr Simon, whose firm was sponsoring broker of the IPO, said. He said those who failed to secure the amount they applied for would come back on secondary market to buy the lot they wanted earlier.
"We have some orders for buying at hand... and I believe the same is for other brokers," Mr Simon told 'Daily News' yesterday. Zan Securities Chief Executive Officer (CEO) Raphael Masumbuko said they see share appreciation on listing day as many investors want to buy the bourse based on its business fundamentals.
"I predict share price appreciation... to what degree I can't tell on day one, but price will continue to pick thereafter since investors' appetite is high," Mr Masumbuko said. Also prediction of share price appreciation was pegged behind the fact that investors had been refunded their money since last week.
The refund came after the share allotment. DSE wanted to raise 7.5bn/- with a green shoe option of 10 per cent to equal 8.25bn/- , however, ended getting 35.77bn/- representing an oversubscription of 377 per cent.
The Capital Markets and Securities Authority (CMSA) later approved DSE's green shoe elevation to 35per cent from 10 per cent. The move means DSE initial offer was extended to 10.125bn/- from 8.25bn/- with green shoe.
The listing pave way for the Dar bourse to self-list or demutualisation to now become the third such bourse to do so in Africa--after Johannesburg and Nairobi exchanges. The DSE intends to selflist its shares on the secondary market in the Main Investment Market (MIMS) segment under the ticker "DSE" and make its shares tradable.
Also CMSA has agreed on the DSE request to grant in full all investors who applied for 10,000 shares or placed 5.0m/-and less and above that to enter into pro-rata process.
The planned self-listing is in line with the global trend and practice for Exchanges and is aimed at achieving good corporate governance practices, efficiency and effectiveness of the DSE and further strengthens its strategic and operational practices.
